Spies Like Us
The Washington Times
July 8, 2004
By Donna DeMarco

Max Jakeman is an undercover agent -- for a pizza chain. He also has spied on fast-food chains, upscale restaurants, movie theaters, bowling alleys and golf courses.

The Alexandria resident is one of the thousands of mystery shoppers who get paid to give feedback on their overall customer experience.

"Consumers have more choices than ever before," said Jeff Hall, president of the Mystery Shopping Providers Association. "The smart companies realize they can compete by creating an optimized customer experience."

More companies are relying on the shoppers' anonymous feedback to determine how they can improve customer service, which plays an important role in business transactions.

"If the customer has had a bad experience, they're going to go somewhere else," said Jeff Marr, vice president of Walker Information, which provides research on customer loyalty. "When it comes to retailing, you're only as good as your last interaction."

The mystery shopping industry has grown over the past decade as more companies -- from small businesses to Fortune 500 companies -- have tried to focus more heavily on customer service, officials say. Companies such as McDonald's, Starbucks, Home Depot, Kinko's and Giant Food are just a handful of the companies that use mystery shoppers.

The industry has expanded from typical service-oriented clients -- such as restaurants, retailers and hotels -- to industries like banks, insurance companies, car dealerships, funeral homes and apartment buildings.

"This is a critical marketing tool," said Mr. Hall, who is also chief executive of Second To None, a mystery shopping company in Michigan. "Companies need to connect with their customers -- not just with a fake smile."

Jerry's Subs & Pizza began a formal mystery shopping program in April.

"We had to improve our service," said Dana Siller, director of corporate marketing. "Our customers demand it because they are getting it in other places.

"If we can match our service to our food, we'll be clicking on all cylinders," Mr. Siller said.

Mystery shopping is big business. Between $400 million and $600 million is spent annually on it, says the National Center for Professional Mystery Shoppers and Merchandisers (NCPMS).

Businesses use different companies to connect them with mystery shoppers, who are independent contractors. In some cases, retailers use their own employees to mystery shop in their stores.

Between 500 and 600 mystery shopping companies act as the middleman between the shopper and the client, the center says. In addition, they analyze the data and show clients how to enhance customer service using the shoppers' feedback.

"Mystery shopping is nothing more than receiving feedback from anonymous customers," said Paige Hall, president and chief executive officer of the Secret Shopper Co. in Atlanta.

It is estimated that between 600,000 to 700,000 active mystery shoppers -- also known as secret shoppers -- are in the United States.

Mr. Jakeman, who is in the Army, mystery shops between three and four times a week, usually on weekends and evenings. He calls his answering machine at home and leaves notes about his experience so he doesn't forget details before he has to write the report.

Mr. Jakeman, who gets assignments from 17 different mystery shopping companies, thinks his job helps make a difference.

"I'm a consumer and I've been places where I've been treated badly," Mr. Jakeman said. "With mystery shopping you feel like you're making an impact."

The shoppers get paid different amounts for their work, depending on the industry and degree of difficulty. Grocery stores pay $10 to $25, movie theaters pay $10 to $50 and florists pay $45 to $100 per assignment, according to Ilisha Newhouse's book "Mystery Shopping Made Simple."

Mr. Jakeman brings home $300 to $400 a month in cash, in addition to about $1,000 in perks including free movies, free oil changes, free pizza and free rounds of golf.

Newhouse says a full-time mystery shopper who works 40 hours can make about $40,000 a year.

"You're your own boss," said Niccole Rogers, NCPMS president. "You make your own hours and determine what assignments you want."

The shoppers must be observant, have great writing skills and be professional.

"You put your trust in these secret shoppers that they will critique professionally," said Don Harrison, a spokesman for Home Depot, which has been using mystery shoppers for years. "We're looking for feedback on a regular basis."

Shoppers are critiquing the experience from the moment they pull into the parking lot to when they leave.

At Home Depot, shoppers take mental notes on how they are greeted, what products are missing on the shelves, pricing, employee interaction and the overall look and experience at the store.