mystery shopping tvs motors by hs brands

AN ANALYSIS OF MYSTERYAN ANALYSIS OF MYSTERY

SHOPPING IN TERMS OFSHOPPING IN TERMS OF CONDUCTING MARKET AUDITCONDUCTING MARKET AUDIT

((A STUDY CONDUCTED IN SPECIAL REFERENCE TOA STUDY CONDUCTED IN SPECIAL REFERENCE TO TVS MOTORS LTD. UNDER THE BRAND BANNER OFTVS MOTORS LTD. UNDER THE BRAND BANNER OF

HS BRANDS INTERNATIONAL, BANGALOREHS BRANDS INTERNATIONAL, BANGALORE))

(A report submitted in partial(A report submitted in partial fulfillment for the requirement offulfillment for the requirement of the award of Honours Degree inthe award of Honours Degree in

Business Administration)Business Administration)

UNDER THE GUIDANCE OF:UNDER THE GUIDANCE OF: MS. SWETA RANI MS. SWETA RANI(CO-ORDINATOR, BBA)(CO-ORDINATOR, BBA)

REPORT COMPILED REPORT COMPILED AND PREPARED BY:AND PREPARED BY:SWATI SINHASWATI SINHAROLL NO. 41ROLL NO. 41SESSION- (2007-10)SESSION- (2007-10)

DEPARTMENT OF BUSINESS ADMINISTRATIONDEPARTMENT OF BUSINESS ADMINISTRATIONPATNA WOMEN’S COLLEGEPATNA WOMEN’S COLLEGE

BAILEY ROAD, PATNA-800001BAILEY ROAD, PATNA-800001

Department of Business Administration

Patna Women’s College(NAAC Accredited-Grade A with CPE

Status)Bailey Road

Patna-800001, Bihar

Date: ……………......

Guide’s certificate

To whom it may concern

This is to certify that this Project Report titled-“A Study of Mystery Shopping in HS BRANDS International, Bangalore” (A Study conducted at HS Brands International, Bangalore; with special reference to TVS Motors Ltd.), has been compiled and prepared by Miss. Swati Sinha, Roll/41, BBA-II, Session: 2007-2010; under my guidance and supervision.

This entire Project Work is an outcome of her own creativity, concept and imaginative effort.

I recommend this Project for being accepted and evaluated.

………………………………..

Miss Sweta Rani (Guide & Coordinator)

ACKNOWLEDGEMENTsACKNOWLEDGEMENTsAny effort and activity always needs to be acknowledged by the person concerned in terms of thanksgiving. At the outset, I extend my deep gratitude to God Almighty without whose blessings and support, I could not have undertaken this Project Assignment at HS Brands International.

My Parents- Dr. Pradeep Kr. Sinha and Mrs. R.K. Sinha and my elder brother Mr. Mayank Sinha, have been very cooperative and supportive in every respect as far as managing this entire activity has been concerned. My Principal- Dr. Sister Doris D’Souza A.C. also needs to be thanked in this regard for her valuable consent which she provided for my Summer Training. My Faculty Members, consisting of my Co-ordinator Ms. Sweta Rani, and others deserve special thanks for giving me a positive guideline in every respect as far as preparing the complete report is concerned.

This Report of mine would not have been completed without the active support of my Guide-Ms. Sweta Rani, who was instrumental in deciding the Project Theme and has been responsible for structuring the total Report format including the Basic Project Protocol. This entire Report has been her brain child and I owe her a deep sense of gratitude in this context.

My Friend, Ms. Shruty Roy has been a great source of inspiration during this entire Project Study and I shall never forget her support and co-operation.

The sense of gratitude shall not be complete, unless and until I express my thanksgiving to Mr. Sanjeev Shenoy, Senior Executive in the Organization under whose guidance this entire Study was conducted and completed. Without his support and motivation, this entire compilation would not have been ready.

Finally I take this opportunity of extending my thanks giving to each and every individual, with whom I came across and who directly or indirectly helped me in undertaking the study.

Place- Ms. Swati sinhaDate-

CONTENTSCh. No. PAGE NO.

PREFACE

PROFILE OF THE STUDY

1. Hypothesis of the Study (i)

2. Objectives of the Study (ii)

3. Research Methodology (iii)

4. Limitations of the Study (iv)

Ch. 1 HS BRANDS INTERNATIONAL -An Introduction

HS Brands International

Services

Business Focus

Circle of Success

Why Service Sleuth?

TVS Motor Company Ltd.

TVS Brands

Ch. 2 ORGANIZATIONAL FRAMEWORK

HS Brands’ Team

Board of Directors

Ch. 3 COMMERCIAL PARAMETERS

Financial Highlights

Balance Sheet as at 31st March, 2008

Profit and Loss Account for the year ended 31st March 2008

Ch. 4 CONCEPT OF MYSTERY SHOPPING

What is Mystery Shopping

Why use Mystery Shopping

Benefits of Mystery Shopping Program

History of Mystery Shopping

Who uses Mystery Shopping

Mystery Shopping Process

Mystery Shopping Methods

Steps involved in Mystery Shopping

Difference between Mystery Shopping & Marketing Research

Ch. 5 ANALYSIS & INTERPRETATION OF THE STUDY

Ch. 6 FINDINGS OF THE STUDY

Ch. 7 CONCLUSIONS & RECOMMENDATIONS

REFERENCES

ANNEXURE

PREFACE Summer Training Programme and Projects are an inevitable part of

a Professional Curriculum. On-the-job Training is “to learn by

doing itself”. The total concept of summer training rotates around a

system of protocols where the trainee/participant plan Study and

the orientations being derived from the Study Concerns can

exposure to a level of knowledge. Keeping all this in view, I was

placed with the HS Brands International, Bangalore. I was

assigned a task concerning a Study related to Mystery Shopping in

TVS Motors Ltd. and a hypothetical aspect of the standing of HS

Brands International in Bangalore. The Profile Protocol of a Report

generally is based upon a conceptual framework so as to provide

précised information about the entire Project Work. Keeping this

point it has been conceived, studied and analyzed.

ProfileProfile of theof the studystudy

Hypothesis of the

StudyThe principle hypothetical assumption of this study is based upon the fact

that every organization requires a mystery shopping technique, which gives

the feedback of the customers on different basis and what is primarily

important refers to the internal setup and the Intra-Mural atmosphere. The

element of mystery shopping is quiet prominent and apparent in every

organizational scenario and precisely speaking, it needs to be managed in a

planned way so as to carve out the best possible results. This study assumes

that even in an organization like TVS Motors Limited, the element of

mystery shopping needs to be practiced and analyzed.

Objectives of theObjectives of the

StudyStudy

This entire study has been designed and developed to undertake certain

specific Aims and Objectives, and the major ones in this regard are:-

To provide a level of service that attracts a greater flow of customers,

enhances loyalty and increases the likelihood of both purchases and

recommendations.

To improve the performance, attitudes and behavior of customer-facing

staff in either hospitality, retail or trade outlets, by providing tangible

feedback about each sales person’s customer handling technique.

To check that current promotions are being sold and ensure that special

offers are being honoured and adhered to in the way that you intended.

To ensure that the required standards in and around the outlet premises

are being met.

Methodology of theMethodology of the studystudy

The study is about the practice of mystery shopping of HS Brands

International in TVS Motors Limited. The study is done on the basis of both

primary and secondary data bases collected from the organization.

PRIMARY DATA SOURCES:

Help of the questionnaire from non-executives.

Informal talk with the executive personnel.

Informal talk with the employees of the organization.

Informal talk with the customers.

SECONDARY DATA SOURCES:

Information by visiting different TVS Motors Showrooms.

Information from the organization’s website.

LimitationsLimitationsIt is said there is limitation to everything. Though sufficient care was taken

to minimize the error as much as possible but still there were limitations of

the study. Few of these are as follows:

Mystery shopping relies on the subjective judgment of researchers, so

care must be taken in training them to approach each encounter

consistently and to rate experiences as objectively as possible.

Some of the responses given were not clear.

Mystery shopping is inappropriate for some industries, where it is

impossible to “create” a customer who is unknown to the customer

service organization.

Since some amount of deception is involved in “mystery shopping”, it

is important to explain to employees the reason for and the value of this

approach, otherwise there is the potential to damage employee morale

CHAPTER-1CHAPTER-1

HS BRANDSHS BRANDS INTERNATIONAINTERNATIONA

L- AnL- An IntroductionIntroduction

INTRODUCTIONINTRODUCTIONHS Brands International is a joint company of Service Sleuth and The

Mershimer Group. Both industry leaders have joined resources to keep

Client Company ahead of its losses and on top of its operations at all times,

any day of the week. Through its extensive network of services and

dedication for the top performance it offers customized programs adapted to

meet the needs.

The Mershimer Group is Industry leader in:

Royalty Assurance

Loss Prevention

Brand Protection

The Mershimer Group provides outsourced Royalty Assurance and Loss

Prevention solutions for franchised and company owned retail and restaurant

businesses. They “Protect America’s Favorite Brands” from financial loss

which can result from underreporting of sales, inventory shrinkage,

employee theft, and other fraudulent activities. This type of financial loss

drains bottom line profits.

Using proven strategies and tactics, The Mershimer Group creates proactive

programs which vary depending on the needs of the client. Programs may

include any combination of mystery shops, coordination of investigations,

compliances and financial audits, awareness materials, standards

evaluations, and employee hotline services.

They work with each client to build effective program to meet their needs. In

addition, it also works with its clients to create loss prevention and royalty

assurance policies and procedures, and other solutions for controlling

workplace loss.

Service Sleuth is Industry leader in:

Mystery Shopping

Data Collection

Surveying & Auditing

Service Sleuth will send an experienced auditor to your store, restaurant or

other business for an anonymous, unannounced site visit. Frequently, the

“shopper” will have a background in the same business or one very similar.

The shopper will observe and report on aspects of your business such as:

PROCEDURES - Policies, selling skills and merchandising.

OPERATIONS - Cleanliness, safety, security and staffing.

INTEGRITY - The handling of cash and customer receipts.

CUSTOMER SERVICE - Courtesy, customer interaction and problem

solving.

RETENTION ISSUES - Unsolved problems that would keep a

customer from returning or recommending the business.

GAMING EVALUATIONS - Slots, Table Games and Cage.

SERVICESThe main services include:

Mystery Shopping

Customer Data Collection

Surveying & Auditing

Customized Analysis and Consultation packages are available in many

different areas of operation, including but not limited to training programs,

marketing programs, sales promotions, incentive programs and store

operations. Experienced business consultants are available to review mystery

shop data and provide the following services:

Detailed &Customized Analysis Reports: Experienced business

professionals and certified trainers will prepare your customized report

containing analysis on opportunities and strengths recorded in the

Mystery Shoppers’ evaluations.

Survey Recommendations: Recommendations are provided in the

report on ways to improve the results obtained in the surveys through

question revisions, addition of new questions and addition of new

sections.

Consultation: Reports may contain consultation on operational

procedures, training needs, effectiveness of marketing, ideas and

suggestions on incentive programs and recommendation on sales

promotions to enhance your current corporate values and culture.

References: Report may contain references to publications, “canned”

training programs, best practice business methods and time-tested

business models that could be beneficial for your overall business results.

BENEFITS:

Save time by having experienced professionals review your data and

create your analysis.

Increase the effectiveness of your survey though recommendations

on questions and survey structure.

Increase sales and profit potential through consultative

recommendations.

Develop your workforce potential by utilizing the references which

will increase business knowledge, reinforce best practice methods and

enhance training.

BUSINESS FOCUSWith the above services, Service Sleuth helps with “Laying the Foundation” at client’s business. This step is very important to a successful business!

CIRCLE OF SUCCESS• Obtain a return on your investment with customized

analysis/consultation on all data received by the Mystery Shoppers.

• Consultation will advise on continued development plans and incentive

programs that reinforces core company values.

• Continued evaluations and feedback from Mystery Shoppers will

reinforce desired behavior.

BACKGROUND HISTORYService Sleuth is an independent division of Howard Services, which is co-owned

and operated by a Licensed Private Investigator that is one of only a few thousand

security professionals internationally that holds the Certified Protection

Professional (CPP) designation. This PI license is required for mystery shopping in

the state of Nevada. They have it! Many mystery shopping companies don't.

Mystery shopping companies that do not have a PI license must either perform

mystery shops illegally or hire a private investigator that most likely is not an

experienced mystery shopper. Because we have this license, it can protect you in

the event of litigation.

Statistics have shown that more than 90% of customers will not complain when

they are dissatisfied, and often you may not be aware of the 10% who do complain.

Most of these dissatisfied customers will defect to competition and will share their

negative experience with up to 15 of their friends and family members.

Considering that it costs six times more to attract a new customer than it does to

keep an existing one, retaining its current customers is not only essential, it is the

lifeblood of your business. In this highly competitive environment a business

cannot afford to lose any customers to its competition. These services will prevent

the loss of the most valuable asset, hard-earned customers. Since 1992, Service

Sleuth™ has been helping large and small service and product-oriented businesses

build customer loyalty and win new customers with a dramatic positive effect on

profitability. It assures consistent quality, personal service, a clean environment

and employee integrity. As any good businessperson knows, it takes years to gain a

customer, but just seconds to lose one.

As a division of Howard Services, we have advised hundreds of retail, industrial,

hospitality and distribution clients in crime prevention, security and shortage

control. Many of our Mystery Shopping Clients have found this link to be very

advantageous when their needs moved beyond Customer Services and procedural

issues. Our Total Loss Prevention Program goes far beyond Customer Service and

Security Equipment Design. Services we offer include (among others):

“Spotting” (procedural issues related to integrity among employees).

Competitive Shopping, to learn what your competition is doing right (and

wrong) and what they are saying about your products and services.

Customer Retention Analysis.

Incentive Programs.

Comment Cards.

Survey Kiosks.

Customized Services.

WHY SERVICE

SLEUTH?WHY THEY ARE DIFFERENT?

T he Sherlock Difference

Service Sleuth has its own customized and advanced version of the specialized

mystery shopping software, SASSIE called Sherlock.

Licensed Private Investigators

Why their Clients Switched to Service Sleuth?

There are over 500 Mystery Shopping firms, so why Service Sleuth? In the early

days of HS Brands, the owners performed many of the shops themselves. They

were familiar with the process; having been “shopped” themselves during their

early years in retail or, later, as managers, being in charge of securing mystery

shopping services. They have also worked in restaurants and retail and fully

understood what it feels like to be on the business side of the counter. Through this

background they became thoroughly familiar with the strengths and weaknesses of

the Mystery Shopping Industry. The main aim in creating Service Sleuth was to

offer a Mystery Shopping operation truly “above and beyond” the other providers.

Below are some of the common issues companies have with Mystery Shopping

companies, we designed every aspect of our services to overcome and eliminate

these weaknesses—right from our beginning:

Poorly qualified shoppersPoorly written reportsReports with few or no explanationsOld reports (of little use to clients)

Poor communication with the clientDisorganization

TVS MOTORTVS MOTOR COMPANY LTD.COMPANY LTD.

TVS Motor Company is one of the premiere automobile companies in India. The

word TVS stands for TV Sundaram Iyengar and Sons Limited which is the holding

company for the TVS Group of companies. The firm is engaged in the

manufacturing of almost all kinds of automotive components, two wheelers and a

few other industrial products. The company was founded by TV Sundaram Iyengar

in 1911. The company is headquartered in Chennai and its manufacturing and

R&D units are located at Mysore and Hosur, near Bangalore, and Baddi in

Himachal Pradesh. TVS Motor Company is the first two-wheeler manufacturer in

the world to be honored with Deming Prize for Total Quality Management.

About the CompanyAbout the CompanyTVS Motor Company Limited is the third largest two-wheeler manufacturer in

India and globally among the top ten. It is the flagship company of TVS Group, a

USD 2.2 billion conglomeration of companies. At present, the group is comprised

of more than 30 companies and employs more 40,000 people worldwide. Its dealer

and service network is widely spread in India.

TVS has enjoyed a steady growth since its inception. It has continuously expanded

and diversified, and brought in new verticals within its fold. Today it boasts a

strong presence in the manufacturing of two-wheelers, auto components and

computer peripherals. The company is also involved in the distribution of heavy

commercial vehicles, cars, finance and insurance. With such a portfolio, the

company contributes a lot to Indian economy.

The company launched the first of its two-wheeler product in 1980. It was a 50cc

moped, which was successful because of its capability to carry two people. It

collaborated with Suzuki Motor Corporation of Japan, for the manufacture of 100

cc motorcycles under the brand name of Ind-Suzuki Motorcycles. Subsequently,

the company changed its name to TVS Suzuki Ltd. However, the collaboration

with Suzuki was only for motorcycles. The collaboration with Suzuki ended in

2001 and thereafter, the name was changed to TVS Motor Company. The company

has set up an overseas manufacturing unit in Indonesia.

TVS BrandsTVS Brands

TVS Apache

TVS Apache is an exciting offer from TVS. A powerful

blend of contemporary design and engineering, TVS Apache

is superbly styled with fantastic finish. The mighty machine has sleek finish with

lines that flow smoothly and seamlessly.

TVS Apache RTR FI 160

This 160cc Apache launched in the growing premium

segment, was declared Performance Bike of the year 2008 by Auto Business

Standard Motoring, NDTV and Overdrive. It also bagged the NDTV Car & Bike

Award for Best Design of the year.

TVS Centra

TVS Centra is an efficient bike in the popular 100 cc segment in

India. Thanks to the VTI (Variable Timing Intelligent) engine

technology, it is one of the most fuel efficient bikes in India. Coming with a slew

of innovative technologies and superb design, the bike promises style, mileage and

riding comfort.

TVS Fiero FX 2

http://www.iloveindia.com/bikes/tvs/fiero-f2.html

http://www.iloveindia.com/bikes/tvs/centra.html

http://www.iloveindia.com/bikes/tvs/apache.html

TVS Fiero FX 2 is a dynamic looking body with lots of power packed features.

The all-new twin pod instrument cluster comprises the speedometer and trip

tachometer. Triple rated 5-step shock absorber at the rear and hydraulically

damped front suspension imparts stability and comfort.

TVS FLAME

TVS Flame is a 125 cc motorcycle developed by TVS Motors.

It was launched in the Indian market in January 2008. The

removal of spark plug was accompanied by retuning of the engine with changed

mapping and gear ratios.

TVS Star

The TVS Star is TVS' entry-level bike that challenges the

dominance of the Bajaj CT 100 in the economy-segment. TVS has launched

different kinds of motorcycles which are marketed with all customized

specifications.

TVS XL Super

TVS Super XL has been incorporated with all features a two-

wheeler needs to sell itself. The vehicle has been designed with rural vehicles in

mind. With proper safety, speed and easy-to-ride features, it has been able to taste

success in its target market.

TVS Victor

TVS Victor is an impressively styled powerful

motorcycle. The bike is available in new graphics and alloy wheels, which

http://www.iloveindia.com/bikes/tvs/victor.html

http://www.iloveindia.com/bikes/tvs/star.html

accentuate its sporty style. The fuel tank has rounded lines with an aircraft styled

fuel filler lid.

TVS SCOOTY ES

TVS Scooty ES comes with its 59.9 cc 2 stroke single-

cylinder air-cooled engine delivering maximum power of 3.5 bhp @ 5500 rpm. It

comes equipped with variomatic gear box. It has a fuel tank with the capacity 3.5

litres. Being sleek, trendy in structure its dry weight is only 79.5 kg which is really

very controllable.

TVS SCOOTY PEP

TVS Scooty Pep is spreading its success wings all over the

market due to its sleek dual tone body with complementary colored mirrors,

appealing body lining and 99 different colors.

TVS Scooty Pep+

TVS Scooty Pep+ is an addition on TVS Scooty Pep. The

two-wheeler has been successful all over the market due to its sleek dual tone body

with complementary colored mirrors, appealing body lining and 5 different types

of metallic colors.

http://www.iloveindia.com/bikes/tvs/scooty.html

CHAPTER-2CHAPTER-2

OrganizationalOrganizational frameworkframework

Hs brands’ teamHs brands’ team

Tom Mills, CEO and President

Mike Mershimer, COO and Vice President

Sanjeev Shenoy, Director of Business Development - Asia

Board of directors ofBoard of directors of tvs motors ltd.tvs motors ltd.VENU SRINIVASAN

Chairman & Managing

Director

K.N.

RADHAKRISHNAN

President

T. K. BALAJI

H. LAKSHMANAN

T. KANNAN

N. GANGA RAM

C. R. DUA

K. S. BAJPAI

T. R. PRASAD

GOPAL

SRINIVASAN

CHAPTER-3CHAPTER-3

CommercialCommercial parametersparameters

Financial HighlightsFinancial HighlightsFinancial parameters: In Crores (Rs.)

PARTICULARS 05-06 06-07 07-08

Sales and Other Income 3,306 3,921 3,310

Profit Before Interest, Dep. &

Tax

275 203 132

Profit Before Tax 168 91 35

Profit After Tax 117 67 32

Net Fixed Assets 794 1,003 1,043

Share Capital 24 24 24

Reserves & Surplus 742 786 798

Net Worth 673 751 769

Total Borrowings 385 634 666

Earnings Per Share (Rs.) 4.93 2.80 1.34

Dividend Per Share (Rs.) 1.30 0.85 0.70

Book Value Per Share (Rs.) 28.04 31.29 32.04

BALANCE SHEET AS AT 31 st MARCH,

2008

PARTICULARS SCHEDULE 2007(RS. IN CRORES)

2008(RS. IN CRORES)

SOURCES OF FUND

Shareholders’ Fund:

Share Capital I 23.75 23.75

Reserves & Surplus II 785.52 797.83

TOTAL 809.27 821.58

Secured Loans III 506.16 452.68

Unsecured Loans IV 213.66 127.40

Deferred tax liability (net of deferred tax asset) 159.01 154.90

TOTAL 1,601.84 1,642.82

APPLICATIONS OF FUNDS

Fixed Assets:

Gross Block 1483.01 1790.97

Less:-Accumulated Depreciation 685.93 774.49

Net Block V 797.08 1016.48

Capital Work-in-Progress VI 205.83 26.57

Investments VII 344.74 338.96

Current Assets:

Cash and Bank Balances VIII 86.56 3.73

Advances and Other Assets IX 735.84 771.06

TOTAL (A) 822.40 774.79

Current Liabilities & Provisions:

Current Liabilities X 577.02 505.76

Provisions XI 49.73 60.99

TOTAL(B) 626.75 566.75

Net Current Assets (C)=(A-B) 195.65 208.04

Miscellaneous Expenditure(to the extent not written off or adjusted)

XII 58.54 52.77

TOTAL 1,601.84 1,642.82

Profit and Loss Account for the year ended 31st March 2008

RS. IN CRORES

Year ended 31-03-2007

Year ended 31-03-2008

Gross sales 4,473.44 3,683.53Less: Excise duty 618.48 464.03Net sales 3,854.96 3,219.50Other income 65.93 90.85Total Revenue 3,920.89 3,310.35Raw materials and components consumed 2,903.37 2,445.51Salaries and wages, stores consumed and other expenses 812.41 730.74Miscellaneous expenditure 1.88 1.95Sub Total 3,717.66 3,178.20Profit before Interest, depreciation and tax (A – B) 203.23 132.15Interest and finance charges (net) 24.78 2.19Depreciation 87.60 94.59Profit before tax 90.85 35.37Provision for taxation 9.50 3.65Provision for fringe benefit tax 4.75 4.06Provision for deferred tax 10.00 (4.11)Profit for the year (after tax) 66.60 31.77Balance profit brought forward 35.50 29.09Profit for the year (after tax) 66.60 31.77Total 102.10 60.86Tax relating to earlier years 0.32 –Interim dividend paid 16.63 –Dividend tax paid 2.33 –Proposed dividend 3.56 16.63Provision for dividend tax 0.61 2.83Transfer to general reserve 49.56 10.00Balance surplus carried forward to Balance Sheet 29.09 31.40Total 102.10 60.86Nominal value of each share in rupees 1.00 1.00Earnings per share in rupees on 23,75,43,557 shares 2.80 1.34Diluted earnings per share in rupees 2.80 1.34

CHAPTER-4CHAPTER-4

Concept ofConcept of mysterymystery shoppingshopping

What is mysteryWhat is mystery shopping?shopping?

• Mystery Shopping is the practice of using trained shoppers to anonymously

evaluate customer service, operations, employee integrity, merchandising,

and product quality

• Mystery Shopping goes by many names:

Secret Shopping

Mystery Customers

Spotters

Anonymous Audits

Virtual Customers

Employee Evaluations

Performance Audits

Telephone Checks

ww hy Use Mysteryhy Use Mystery Shopping?Shopping?

• When location, pricing, and product assortment are no longer unique, service

is often the key to success or failure

• It costs 10x more to get a new customer than to keep an existing one

• One unhappy customer will tell 5 other people of their bad experience with

service

• Why customers leave:

69% poor customer service

13% poor product quality

9% competitive reasons

5% other

3% move away

1% die

• “What gets measured, gets done” Tom Peters.

Benefits of MysteryBenefits of Mystery Shopping ProgramShopping ProgramMonitors and measures service performance

Improves customer retention

Makes employees aware of what is important in serving customers

Reinforces positive employee/management actions with incentive-based reward systems

Provides feedback from front line operations

Monitors facility conditions - asset protection

Ensures product/service delivery quality

Supports promotional programs

Audits pricing & merchandising compliance

Allows for competitive analyses

Compliments marketing research data

Identifies training needs and sales opportunities

Educational tool for training & development

Ensures positive customer relationships on the front line

Enforces employee integrity.

The History ofThe History of Mystery ShoppingMystery Shopping

Initially, mystery shopping was a technique used by private investigators to

prevent employee theft - primarily at banks and retail stores.

In the 1940’s, Wilmark coined the term “mystery shopping” and began using

the method for evaluating customer service.

In the 1970’s and 80’s, Shop ‘n Chek popularized mystery shopping by gaining

extensive publicity.

In the 1990’s, fueled by the internet, the mystery shopping industry experienced

rapid growth and acceptance.

Into the 2000’s, the creation of software packages such as SASSIE and Prophet

have revolutionized the industry.

Mystery Shopping TodayMystery Shopping Today Worldwide growth of industry

– Nearing $1.5 Billion (USD) worldwide

More focused on improving customer service than on policing bad

employees

Clients becoming more sophisticated in use of mystery shopping

Faster reporting from field to client using the internet

More diverse and specialized services.

The Internet’s ImpactThe Internet’s Impact on the Mysteryon the Mystery

Shopping Industry Shopping Industry Wide-ranging impact - with shoppers, clients, and providers

Many shopper oriented web sites and ListServ’s exist to assist shoppers with

education and finding jobs

Internet provides more reach and exposure for mystery shopping services

Faster and less expensive shopper recruiting

Faster and less expensive data collection

Faster, automated reporting processes

Increased need for validation of data.

Who Uses MysteryWho Uses Mystery Shopping? Shopping?

Any business/organization that needs to monitor its operations, facilities, product

delivery, and service performance.

Banks

Retailers

Manufacturers

Call Centers

E-Commerce services

Government agencies

Hospitals

Associations

Franchise operations

Promotions agencies

Hotels

Restaurants

Movie Theatres

Recreation parks

Transportation systems

Fitness/health centers

Property management firms

Freight/courier services

And many more.

MYSTERY SHOPPING PROCESS

Mystery ShoppingMystery Shopping methodsmethods

Telephone shops

In person/on-site shops

Checklist shops (quantitative)

E-Commerce web site shops

Hidden video/audio recording

Purchase & return shops

Full narrative shops (qualitative)

How is MysteryHow is Mystery Shopping Done?Shopping Done?

Step 7: Review Findings and Repeat steps 3-7.

Step 6: Reporting

Step 5: Data Preperation

Step 4: Data Collection

Step 3: Defining & Recruiting Shoppers

Step 2: Program & Questionnaire Design

Step 1: Setting Objectives & Goals

Step 1: Setting Objectives &Step 1: Setting Objectives & GoalsGoals

Start by asking “What will we do if we knew the answers?”

o Make sure the answers are actionable.

Emphasis should be on reinforcing existing training, desired behaviors, and

standards compliance.

The key factor is to clearly establish where you are, where you want to be,

and how mystery shopping can help get you there.

Step 2: Program &Step 2: Program & Questionnaire DesignQuestionnaire Design

A mystery shopping program works best when it is not a mystery for

employees to know what is expected of them.

– announce & promote the program in a positive manner

The questionnaire, or evaluation form, should satisfy the objectives of the

program, yet be focused and concise for quality of information and accuracy

of shopper reporting.

Questionnaires must be designed to provide objective, observational

feedback with a system to allow for checks and balances.

Typical retail mystery shopping questionnaires cover: greeting, customer

service, facility cleanliness and orderliness, speed of service, product quality

and employee product knowledge.

Questionnaires should be easy for shoppers to complete and should include

specific examples where necessary to clarify the point of evaluation for the

shopper.

Ideally, only "yes" and "no" questions will be asked, and all "no" questions

will require a response from the shopper for clarification.

Multiple response questions are used to allow shoppers to check off the

features and benefits that are mentioned during the shop.

Include a "general comments" section that encourages shoppers to remark on

anything they find significant or interesting during the shop.

Some questions may be more important than others - a point/scoring system

for questions can emphasize the most important issues.

If using a scoring system, which is strongly recommended, appropriate,

weighting of questions is critical.

Some questions may not need to have points allocated to them at all, but

may be necessary for background of the shop report.

Step 3: Defining & RecruitingStep 3: Defining & Recruiting Shoppers Shoppers

Almost anyone can be a mystery shopper - however, shoppers should match

clients’ “real customer” profiles.

Most mystery shoppers are average consumers, typically working part-time

as either independent contractors or employees, who are given guidelines on

how to complete the assignments.

Shoppers are recruited through classified advertising, internet web sites,

email, or referrals.

Most shopping providers have candidates submit a detailed application, at

no cost, and match shoppers with assignments based on the demographic

profile of their client customers.

There may be special requirements for the shop.

Must wear glasses to complete an optical shop.

Shoppers may be qualified on the phone, via internet, or in person, and may

often be required to perform test shops to evaluate their skills before doing

an actual assignment.

Step 4: Data Collection Step 4: Data Collection

Shopping programs require a tremendous effort in recruiting, qualifying,

scheduling, training and managing shoppers.

Individual shopper reports must be distributed, collected, and reviewed in a

short time frame.

It is not uncommon for shoppers to drop assignments during a shop period.

Progress of each shopper in the field should be monitored to ensure timely

reports.

Hint: Establish early deadlines for completing reports.

Provide shoppers with specific shopping scenarios and clear written

guidelines.

Be consistent in shopping. Shoppers should ask for the same products and

ask the same questions at all stores.

Criteria to be evaluated must be objective rather than subjective.

Mystery shopper observations are limited to a choice of fixed alternatives.

Shoppers’ evaluations may be questioned and/or appealed once the facility

knows that a mystery shop has occurred.

Step 5: Data preparation Step 5: Data preparation

Every shopper report must be checked for validity, accuracy, consistency

and objectivity.

Run quality control checks on completed shopper reports before distribution

to the client.

Shoppers may need to be contacted to confirm or validate their reports.

Many providers will process data to provide a laser-print output of

individual shopper reports.

Quantitative data should be tracked using relational database software.

Step 6: reporting Step 6: reporting

A shopping report has a short shelf life.

Individual store reports must be tabulated and distributed to the stores within

30 days of the shop - much sooner if possible.

Summary reports for each district, region, division, department, etc., must be

easy to read and understand.

Make sure management can use the reports effectively.

The internet is making reporting faster and easier for providers, shoppers,

and clients.

Category summaries make reporting easier to analyze and understand.

Category scores are based on an accumulation of points from individual

questions within each category.

A summary page with all category scores and location, shopper and date

information is very useful for quick understanding of performance.

Step 7: Review Findings Step 7: Review Findings Then Repeat steps 3-7 Then Repeat steps 3-7

Once shopper reports are compiled, sharing those results with training and

other personnel is the important next step in a program’s success.

Make it a positive, motivating experience that rewards people for a job well

done while identifying areas where training may improve customer service

and sales.

An established, ongoing program, where employees know that any customer

may be the mystery shopper, is more effective and objective than sporadic

audits.

How to Make The Most ofHow to Make The Most of Mystery ShoppingMystery Shopping

Programs Programs

Let employees know the program is in place and what is expected of them

– This alone will often change behavior.

Promote extensively with signs, cards, etc.

Have a plan for publishing and using the findings.

Realize that shop scores are more reflective of the organization than the individual.

Always use reports in a positive manner to gain acceptance of the program.

Use the reports to target training and operational adjustments.

Provide rewards for excellent reports.

Share the evaluation form with employees and management before initiation - get their input on the questionnaire.

Evaluate only those things that can be changed.

Use binary questions (yes/no) as much as possible.

Use open ended questions to explain special circumstances.

Use category summaries to easily identify key areas.

– Phone, Greeting, Service, Demonstration, Facility, etc.

Use a point/scoring system for benchmarking and to track trends.

How is Mystery ShoppingHow is Mystery Shopping Different From MarketingDifferent From Marketing

Research? Research?

Mystery shopping is a “cousin” to marketing research (related, but not the

same).

Mystery shopping is typically more operational in nature than marketing

research and is most often used for training and incentive purposes.

Marketing research involves determining real customer and prospect

opinions, perceptions, needs, and wants.

Mystery shopping fills in a gap of information between operations and

marketing.

Mystery shoppers are not real customers - they know what to evaluate before

entering the store.

– They may not typically visit the store they are evaluating.

Mystery shopping should not be used alone to determine customer

satisfaction.

– It can compliment, but not replace, satisfaction research.

Mystery shopping is not predictive of every customer’s experience

– unless sufficient samples are taken and data analyzed in aggregate.

CHAPTER-5CHAPTER-5

ANALYSIS &ANALYSIS & INTERPRETATIONINTERPRETATION

OF THE STUDYOF THE STUDY

ANALYSIS &ANALYSIS & INTERPRETATION OFINTERPRETATION OF

THE STUDYTHE STUDY

Any project or research related issue concerns a prolific analysis in terms of

interpreting the total study in

detail. In this section of our

study, we shall access each

response individually and

shall try to come out with an

independent assessment in

support of the hypothetical

assumptions.

1. ANALYSIS OF QUESTION NO.5:1. ANALYSIS OF QUESTION NO.5:

Showroom Glow Sign.

YES NO

No. of visits 48 2

Total no. of visiting showrooms 50 50

Percentage 96% 4%

My first area of assessment concerned an exercise to find out the responses of the

respondents regarding their opinion on the visibility status of the glow sign. From

the above data, we observe the frequency distribution in terms of clear visibility of

the glow sign and we found that 96% it was taken care of properly and definitely

lead to great brand patronage. This could be depicted through the following visual

expression:-

96%

4%

YesNo


Exterior Appearance.

YES NO

No. of visits 50 0


Percentage 100% 0%

In the question no. 7, we have assessed about the appearance of the entrance

doorway and exterior lights lit. From the above frequency distribution table, we

observe that the exterior appearance was totally taken care of by all 10 showrooms.

This could be depicted through the following visual expression:-

100%

YesNo


Greeting & Acknowledgement.

Yes Yes, but took more than 2 min.

No attention paid

No. of visits 34 16 0

Total no. of visiting showrooms

50 50 50

Percentage 68% 32% 0%

My third area of assessment was related to the first impression, i.e. greeting and

acknowledgment. From the above frequency distribution table, we observe that

most of the times i.e. 68%, we were sincerely greeted and offered assistance by a

sales associate within 1-2 minutes of entering the store and rest 32% times we were

given attention but it took more than 2 minutes of entering the store. This could be

depicted through the following visual expression:-

68%

32%

YesMore than 2 min.No attention paid


Welcomed & made comfortable.

YES NO

No. of visits 50 0


Percentage 100% 0%

In this question, we have assessed about welcoming and making the customers

comfortable in the store. From the above frequency distribution table, we found

that the sales associates were very welcoming and this can be depicted by the

following visual expression:-

100%

YesNo


Uniformed Sales Associates.

YES NO

No. of visits 45 5


Percentage 90% 10%

In the thirteenth question, we have assessed about the sales associates being well

groomed and neatly dressed in uniform. There uniform is a light blue formal shirt

and dark blue trousers. From the above data we found that 90% times they were

well dresses and the rest 10% they were neatly dressed but were not in uniform.

This could be depicted by the following pie-chart:-

90%

10%

YesNo


Store badges wore by associates.

YES NO

No. of visits 49 1


Percentage 98% 2%

In the fourteenth question, we have assessed about the associates wearing store

badges with their names printed on them and from the above data it is very clear

that almost every one of the associates were wearing stores badges which shows

their genuinity and authenticity. This could be well depicted through the following

visual expression:-

98%

2%

YesNo


Understanding needs & requirements of customers.

YES NO

No. of visits 50 0


Percentage 100% 0%

In this question, we have assessed about understanding the customers’

requirements by the sales associates and leading him/her to the vehicle display

area. From the above frequency distribution table, it is clear that the customers’

requirement was well taken care of. The above configuration could be shown

through the following visual expression:-

100%

YesNo


Showroom appearance regarding display of vehicles.

YES NO

No. of visits 50 0


Percentage 100% 0%

In this question, we have assessed about the showroom appearance and from the

above data, we observe that all the vehicles on display were well maintained and

free from damages. This could be very clearly shown through the following visual

expression:-

100%

YesNo


Updated prices of vehicles on display.

YES NO

No. of visits 41 9


Percentage 82% 18%

In the eighteenth question, we have assessed about the vehicles on display with

updated price boards with ex-showroom and on road prices. From the above data,

we observe that in 41 visits, prices of the vehicles on display were updated. This

could be depicted by the following visual expression:-

82%

18%

YesNo


Product Presentation.

YES NO

No. of visits 42 8


Percentage 84% 16%

My tenth area of assessment is related to the product presentation and reinforcing

customers’ decision. From the above frequency distribution table, we observe that

most of the times(84%) the sales associate explained all the key features and

benefits of the vehicle with the help of product brochure or flipchart to reinforce

the key product features and also encouraged to experience the vehicle by

suggesting the customer to start the vehicle, trying out controls, etc. This could be

shown through the following visual expression:-

84%

16%

YesNo


Test ride.

YES NO

No. of visits 36 14


Percentage 72% 28%

This area of assessment is related to the test ride of the vehicle voluntarily offered

by the sale associate and the above data reveals that some of the times the

associates were not willing to offer test rides to the customers. This could be

depicted by the following visual expression:-

72%

28%

YesNo


Retail/Finance & Exchange.

YES NO

No. of visits 50 0


Percentage 100% 0%

In this question, we have assessed about the customers being provided with the

information regarding retail/finance and exchange details. From the above data, we

can observe that the sales associates explained the details of the finance/installment

schemes himself and also enquired about the requirement for finance and interest

of the customer in exchange schemes. This could be depicted by the following

visual expression:-

100%

YesNo

CHAPTER-6CHAPTER-6

Findings of theFindings of the studystudy

FINDINGS OF THEFINDINGS OF THE

STUDYSTUDY

The concept of the findings of the study takes care of an analysis pertaining to

important conclusions which needs to be considered for the purpose of illustrating

the most significant and important aspect of the study as a whole. In the study of

mine, we have been able to identify the following findings which need a special

mention and the following paragraphs would highlight the same:

FINDINGS NO.1

Two different types of studies may be carried out under the general term of

mystery shopping studies. In the first type the data subjects’ anonymity will be

safeguarded and all personal data collected will be treated as fully confidential and

used only for research purposes. In the second type such anonymity is not provided

because the data will be used to approach the data subjects individually for

purposes other than scientific research. Different legal provisions may be applied

to both types of mystery shopping studies.

FINDINGS NO.2

In cases where any personal data collected are to be treated as fully confidential

and are not to be used for any purposes other than scientific research the study falls

under the definition of market research and can be described as mystery shopping

research. If the personal data collected are not to be treated as fully confidential

and may also be used for purposes other than scientific research – for example in

connection with staff training, reinforcement of sales efforts or the operation of a

bonus system – then the study does not fall exclusively under the definition of

market research and must not be described as mystery shopping research but as a

mystery shopping project.

FINDINGS NO.3

In situations where no purchase of a product or service is made the length of times

spent should be reasonable in relation to the nature of the market and the type of

inquiry. The time should be kept as short as possible and should not waste the data

subjects’ resources in any way other than a normal customer inquiry might do. The

acceptable length of time which should be spent with members of staff may be

determined by local practice.

FINDINGS NO.4

In cases where any personal data collected are to be treated as fully confidential

and are not to be used for any purposes other than scientific research the study falls

under the definition of market research and can be described as mystery shopping

research.

CHAPTER-7CHAPTER-7

CONCLUSION &CONCLUSION & RECOMMENDATIRECOMMENDATI

ON ON

CONCLUSION &CONCLUSION & RECOMMENDATIONRECOMMENDATION

Mystery shopping studies which would be used as a method of boosting

product distribution or sales by creating an apparent consumer demand for a

product or a service must not be undertaken. Nor must the findings of

mystery shopping studies be used for the purposes of disciplining or

otherwise disadvantaging individuals involved in the study.

Mystery shopping studies must always conform to applicable data protection

legislation. There must be adequate security arrangements in place both at

the client and at the research company level to ensure that any personal data

are secure and not accessible by unauthorized parties.

Mystery shopping studies on the client’s own organization must always be

carried out in a transparent manner. The client shall be made aware of any

time and other operational costs involved in the study and agree to these in

advance.

In the case of mystery shopping studies on competitors’ or other

organizations it is important that the time and other demands created by such

an activity are reasonable and kept to a minimum level. Mystery shopping

studies on competitors’ or other organizations must therefore only be

conducted if it can be assumed that no substantial disadvantage will result

from this for the persons observed or interviewer or for their organization.

This applies in particular to self-employed people or professional people etc,

where time spent on an interview may literally cost them (lost) money.

Adequate security measures must be in place to insure against unauthorized

processing, loss and destruction or damage of the collected data.

Recordings shall not be retained for longer than is necessary for the original

purpose of the mystery shopping study. Disclosure of recordings to the client

or other third parties shall only be made with the consent of the data subjects

and used for the agreed purposes only.

REFERENCESREFERENCES

Career Knowtes: Mystery Shopping by Kailin Gow

Health Care Taps 'Mystery Shoppers' at Wall Street Journal, August 8, 2006

TVS Motors Annual Report 2008, Pg. 2,27-30

Websites:

http://www.mysteryshop.org/

http://www.hsbrands.com/

http://www.tvsmotor.in/

http://www.mspa-international.com/

AnnexureAnnexure

mystery shopping tvs motors by hs brands

Documents