Those perceptions turn into realities that you tell your friends and family. Or maybe you tweet and Yelp! about your experience. You exaggerate the facts. You’re human. It happens.

This past weekend there were thousands of airline passengers who experienced this scenario with Hurricane Irene. And many recounted their perceived experience as fact to anyone who would listen.

Except one.

Jordy Leiser, the chief executive and co-founder of StellaService, a company that researches and ranks customer service, asked himself; “what is really happening?” and set about to find out. He devised a survey to evaluate performance that methodically queried the airlines over multiple media between 12 a.m. and 6:30 p.m. on Friday. The results were interesting, if not surprising.

The most significant thing I gleaned from the survey is that we are moving beyond perceptions, surveys and reviews from customers and into a realm of fact-based feedback. Twitterstorms and paid Yelp! reviews have made it easy for large companies to dismiss the relevance to these opinion-based reviews. But fact-based information, collected dispassionately, methodically and scientifically is harder to ignore and not easily explained away with a PR campaign or free beads.

The large companies are no longer in charge of the data and they are feeling the frustration as evidenced by the email sent by American Airlines spokesman Patrick Martelle in response. Yet many continue to fight a battle of facts with perceptions.

This is where mystery shopping can step in. Obviously customer perception remains something you want to manage, but when you change an operational procedure or a response as a result of knowing how customers factually experienced your product or service, the need for managing negative perceptions drops precipitously.

Manage what really happens — not anecdotes — and you also manage perceptions.

Maximization vs. Optimization is based on a very sound mystery shopping formula:

When budgets are limited, it is generally better to shop fewer stores on a more frequent basis than all stores less frequently. You may, for example, decide it is more important to shop your top 30 best-performing stores. Or you may want to establish different frequencies, or rotate your stores and districts. There are an infinite variety of ways to create the program that works best for you, but the bottom line is to remember that there are enough variations possible to allow you to get the most out of your program without sacrificing the crucial data you need to meet your program goals. When it comes down to whether you should conduct your program quarterly, monthly, weekly or daily, there are other factors to consider:

Quarterly
Great for compiling a snapshot of data but, with so much time elapsed in between shops, it is very difficult to use data to effectively make consistent changes or drive behaviors. Acceptable for monitoring and data collection.

Monthly
Monthly programs are the most popular and budget-friendly choice. A monthly program means a more consistent view of store/team performance, more dependable behavior reinforcement, and more effective identification of strengths and opportunities over the long term.

Weekly or Biweekly
For those wishing to implement a variable program based upon stores types (i.e. such as with high and low volume stores, loss prevention, etc.), a weekly or biweekly program is very effective in driving behavioral changes through constant reinforcement.

Daily
Unless your main goal is loss prevention, a daily program is most likely overkill. In fact, if your main goal really is loss prevention, you are probably more in need of hidden cameras than mystery shopping. Daily programs produce a lot of data that will prove to be useless, since the Manager will not have the time or opportunity to understand and use the data that is produced on a daily basis.

The second most popular question I am asked (especially by naysayers of mystery shopping or those who get low scores) is something along the lines of…Hey this is only one shop a month. How can this really demonstrate what is happening in my store?

Sadly, statistically it cannot. And therein lies the mystery shopping conundrum. Stores with a smaller budget perform fewer shops. Fewer shops lead to less credible data. Less credible data leads to less opportunity to change behaviors and delayed gratification in meeting overall program goals. It also translates into fewer opportunities for training for the entire store. This is exactly why we advocate the Maximization vs. Optimization formula we talked about earlier. Simply put, you are getting the biggest bang for your buck without compromising.

The truth is, anything can happen anytime. But if it happened once, it will happen again. When it does happen again, that is when it is time to become concerned. Can you imagine a sports game being played where no one announces the score? Sounds ridiculous? Well just imagine for a moment, what that would be like……those basketball teams are running up and down the court, throwing baskets on both sides, but since no one is keeping score, no one is leading! Soon, the players begin tiring out. They start walking off the court and sitting down. After all, who cares about working hard if no one is winning? Then, one by one, the fans begin to get up and go home. If the team does not care, why should they?

Do you see the point? Just like in basketball, where the players play harder when they know the score, your frontline staff and store managers will be far more effective when they can see the results of their hard work. Regular, consistent data delivered as expected, in an easily digested format that can be used to direct and change staff behavior, is what wins the game.

“What gets measured gets done,” says Rich. And after years of observing many ineffective programs which resulted in frustration for agencies, brands and retailers and, in some cases, reluctance to start over without a structured process in place, ICC/Decision Services has created The Springboard Process to take the guess work out of launching critical customer experience programs such as shopper intercepts, secret shopping, retail audits, customer satisfaction and employee engagement surveys.

The process begins with an initial meeting where executives are introduced to their personal Customer Experience Team from ICC/DS Quality Assurance, IT and Account Management departments. The new team works together to establish goals, develop surveys and determine the proper frequency and sample sizes of tests to be conducted. The process continues as ICC/Decision Services runs test shops and reviews proposed programs before a full-scale launch. Customized Enterprise Reporting sites created for each client means data is delivered according to their needs and preferences.

“The Springboard Process assures that data gathered will lead to actionable results and provides real value,” says Rich. For more information about the Springboard Process and ICC/Decision Services visit www.iccds.com

About ICC/Decision Services
ICC/Decision Services was founded in 1979 to design and execute Customer Experience Management programs. ICC/Decision Services offers a wide range of qualitative and quantitative business tools, including mystery shopping, store audits, customer feedback and employee satisfaction surveys. Clients include Coach, 7-11, L.L. Bean, CVS, Foot Locker, Walmart and others. The company is headquartered at 561 7th Avenue New York, NY 10018, U.S.A. Phone: (800) 444-1717. E-mail: info@iccds.com.

Increase Sales By Improving the Customer Experience

Sales strategies and selling themes developed at the corporate level are often not executed at the store level. Most chain executives are so busy and immersed in their jobs that they fail to objectively audit the real customer experience delivered at the store. Sometimes headquarters personnel do not have enough time to conduct store visits and, if they do, it is rare that they actually experience a visit the same way customers do. It is astounding how little most retailers spend on measuring and managing how customers really feel while shopping in their stores.

How Does It Feel To Be Your Customer?
Customer satisfaction surveys provide an accurate view of the customer’s perspective. Satisfaction surveys are conducted by interviewing a sample of your customers to determine their perceptions of your stores and sales associates. Rather than compliance (mystery shopping’s realm) customer satisfaction identifies perceptions ““ how your customer feels.

The result of a properly conducted and implemented customer satisfaction program is a store-level action plan defining the key drivers of your business ““ what most needs to be improved to increase your sales.

And that’s how you define the true customer experience.

Consider the following two cases:

Case 1. A national retailer recently increased its budget for an audit of its customer experience, moving from quarterly to monthly measurements because it was able to see definitive ROI from the insights it gained. Spending just $35 per store per month on its mystery shopping program turned out to be “peanuts” when information gathered allowed associate performance and sales to be improved.

$420 a year per store to increase sales turned out to be a bargain. Compare the costs of new fixtures or carpeting. What payback do they offer in comparison? Consider the cost of the 82% of your customers who walk out without making a purchase.>
Unfortunately, too many CFOs look at expenditures from a direct-cost basis without considering the net cost. They fail to see that dollars spent to improve the customer experience drive their top and bottom lines. Expenditures on improving the customer experience are investment dollars, not expense dollars.

Case 2. Another national retailer is stepping up to the plate, even in these uncertain times, by implementing customer and employee feedback systems. The retailer’s objective is to improve their shoppers’ experiences by listening to reactions from actual customers and sales associates. The retailer has commissioned an IVR-driven customer satisfaction program and a web-based employee feedback program. The cost for both of these feedback systems is less than $800 per location annually.

Combining all programs from these two retailers (mystery shopping, customer satisfaction, and employee feedback) totals about $1,200 a year per store, and gives the retailer a 360° business view, providing dramatic payback potential in the toughest retail economic climate in 15 years.

The message couldn’t be clearer. Reductions in programs and information systems leave today’s retailers vulnerable to competition and prevent an understanding of the more demanding mindset of customers. What’s needed is an aggressive commitment to continued information programs, along with complementary data services to fortify retailers for the long haul. Cutting auditing and feedback programs to shore up the bottom line will ultimately have the opposite effect. Partnering with an organization that assists you in communicating the information and in building action plans to foster system-wide improvements, as well as asking the right questions, will deliver the best experience for your customers.

Even in today’s marketplace, customers still have money, but they will become more selective ““ and will spend that money with retailers who offer them the better experience, no matter what.

1) Online mystery shopping will continue to grow as more customers access financial products and services via the Internet. A secure and easily navigatable web site is crucial. Comprehensive product and service descriptions, and ease of interacting with bank representatives is also vital to ensure the optimum online customer experience.

2) As use of mystery shopping programs grows, there may be some unexpected benefits. For example, professional mystery shoppers sent to evaluate a company’s regulatory compliance may uncover problems in employee behavior or store operations. This allows others departments, such as sales and marketing, to benefit from the mystery shopping program, even though that wasn’t the plan.

3) Expect the number and variety of organizations using mystery shopping programs to increase, as mystery shopping moves from the expected retail sector to financial institutions, health care, and other less traditional organizations.

Today’s savvy financial organizations use mystery shopping to gather competitive intelligence. Federal regulators, third-party suppliers and watchdogs use mystery shopping to verify bank branches are selling their financial products properly. As the pressure of competition increases globally for all kinds of companies, mystery shopping will continue to be the best way to find out what you really need to know to continue to compete.

Beyond these basics are three additional, service-oriented ways to improve sales:

1. Increasing Conversions
Typically, 82 out of 100 people who walk into a store leave without making a single purchase. That’s a retail conversion rate of only 18%. While this is a statistic begging for understanding, in harder economic times it makes even more sense to know why shoppers leave your stores without making a purchase.

ICC Decision Services offers a sales calculator that easily helps you determine the lift in sales you would receive from an incremental improvement in your conversion rate. As an example, increasing conversion from the benchmark 18% to 25% results in a yearly additional $115K in sales per store! Contact ICC Decision Services to obtain this valuable calculator.

2. Understanding Why Shoppers Leave Without Purchasing
Now we know 82 out of 100 people leave your store without purchasing. But do we know why? Consider conducting customer exit interviews in select locations to uncover the reasons. Exit interviews are conducted on premise, just as customers leave your stores. Trained interviewers intercept these customers, asking them a series of questions that explore exactly why they did not make a purchase. Exit interviews often dispel intuitive explanations. For example, one, big-box retailer discovered they were losing sales not because of inventory outages, but because shoppers could not find the merchandise they wanted.

3. Improve Suggestive Selling To Increase Sales
Our studies show that improving suggestive selling can increase the bottom-line by millions. To effectively increase suggestive selling, provide sales staff with real reasons customers should buy your merchandise, helping staff to reinforce the customer’s decision process.

Of course, you need assurance that sales associates are following through with each and every customer. You can further expand your suggestive sales programs by increasing sales through accessories and related products. Obviously, the more merchandise the customer is exposed to, the greater the likelihood that they will buy something. This means active selling, not passive assistance. Sales associates need to be reminded to actively sell and need motivation follow through.

Having 100 reports to choose from, and access to a big bank of data you can slice and dice a million ways, might seem like it would be helpful. But at the end of the day, is that really going to change staff behaviors and drive results at the store level?

My suggestion is to keep things simple. A few targeted reports with meaningful, useable data (like basic trending and top opportunities) is enough for most management levels. If market research needs multiple reports, it can certainly be accomplished. But be careful not to get so bogged down in gathering data that the rest of the organization is hindered.

“Less is More’ is the buzzword when it comes to reporting. Gathering lots of different data might seem useful, but in the end, things can get messy and the ability to use data to effect any real frontline staff change is minimized. If marketing wants reports, they can have them. Help managers do their very best on the floor by providing the targeted data they really need.