Mystery shopping's mission shifts from espionage to training.

By Jay Holtzman

Mystery shopping, once used to instill fear and to weed out the suspected bad apple, has morphed from an exercise in espionage into an irreplaceable sales training tool. It's no longer just the results that count but also the process. How is the company's philosophy being conveyed to prospects? How is the brand being represented? How can salespeople do better?

"We have a particular style of selling skills that we stress at our 'boot camp' that all new salespeople attend," explains John Rymer, Morrison Homes' vice president of sales and marketing. "We tell people at boot camp that they will be shopped on the basis of how well they demonstrate these particular sales skills," he says.

Centex takes a similar approach. "Salespeople can sell and close houses, and their success may be a function of the neighborhood or the market or whatever," says Jon Fogg, vice president of sales for the Dallas-based company. "But we really want to be sure they are using the process we teach them, and mystery shopping lets both the salespeople and the sales managers evaluate that," he adds. "We have a body of training materials that sets out a selling process. We train the mystery shoppers on that material and that is how they evaluate the shop."

Robert Schottenstein says mystery shopping has helped deliver tangible benefits, helping train salespeople to, "sell the M/I Schottenstein way, tell the MI story, and explain why people should buy a home from MI." He uses mystery shopping to reinforce three specific areas of sales presentation: "meeting and greeting," telling the MI story, and follow up. "We've seen marked improvement in all three areas," explains Schottenstein, president of the company, in Columbus Ohio.

Indeed, with competition and differentiation key concerns, builders are tweaking their shops to evaluate not just overall sales performance but specific aspects of their sales story or selling method.

Schottenstein "blind" shops every one of his salespeople twice a year. Shea Homes, in Walnut, Calif., shops its entire sales force annually, says Bill Pisetsky, Shea's vice president of sales and marketing. Pisetsky's goal this year is to double those efforts. "We spend so much time training the sales team," he says. "The beauty of mystery shopping is that it shows us whether or not they are doing what we asked them to do."

Tape at 11

Probably the most dramatic change in mystery shopping in recent years is the advent of "video shopping" that has largely replaced audio recording of mystery shops. Service providers say up to 90 percent of their builder-customers have switched to video.

"Video shopping is the single best training tool we have for our sales staff," says Pisetsky. "It is exact. It is real. When you had just audiotapes you didn't have the benefit of knowing what else was going on: Did the salesperson have three people waiting to talk? Were there other distractions? You just didn't know. With video, it is what it is," he adds.

Video provides insight into vital but intangible elements of selling in a way that no other method can match. A case in point: Pisetsky recalls one salesperson who saw how he slouched. He learned to stand up straighter and look directly at the customer. Another had a nervous laugh she wasn't aware of. "Ironically, what she was doing was excellent. But she was so nervous about it. We talked to her about relaxing, and she took it to heart, then did a much better job on the follow-up video," he says.

David Weekley, chairman of David Weekley Homes in Houston, finds video much more useful than audio. "When people can see themselves," he says, "it has more impact." And impact is the name of the game.

Video isn't cheap, though. A video shop can be double the cost of audio. There are many variables that affect cost, but video shopping can run $500 to $700 per session.

Video shopping also comes with cautions. It is powerful, intensely personal, and can be threatening to salespeople.

"Salespeople fear them, and I think it is the fear any of us would have if we are recorded at work," says Sandra Kulli, a marketing consultant in Malibu, Calif. "It's normal for them to fear mystery shopping, but really important that we do it in spite of that," says Kulli, president of Kulli Marketing.

Two key conditions make mystery shopping less threatening, and therefore more productive, for salespeople: Inform them when they are hired that they will be shopped, and use it for training and education, not discipline. Ironically, once they are used to mystery shopping, high-performing salespeople like and request it, say builders.

Sales managers also have to be trained to use mystery shopping wisely. "Mystery shopping in the hands of a manager who doesn't know how to use it is really dangerous," explains Fogg. A poor performance on a video mystery shop can be devastating to a salesperson. A manager's criticism, if expressed poorly, can provoke anger and resentment that can spread throughout the sales team. The solution: "Train the manager," Fogg says.

The Metrics

Mystery shopping is useful in part because it provides both qualitative and quantitative information. Most tapes are delivered with written and scored reports, and builders do track performance in the aggregate. But the emphasis for most is on improving individual sales skills.

"I think most of the results are qualitative," says Fogg. "It's going to be hard for us to say that performance on a mystery shop equates to driving operating margins or returns." Weekley agrees. "You can't put objective measurements on what is an art form, so to speak," he says.

Builders who see more value in the quantitative data combine it with other metrics to help form an overall performance picture. One such is Bill Probert, executive vice president of sales and marketing for John Laing Homes, in Newport Beach, Calif. Laing sales counselors are rated on 10 performance areas such as consumer research, sales education, percentage of guest registration cards, follow up, referrals, and mystery shopping scores. Each metric reflects performance in a different but related area.

Mystery shopping acts as a "check and balance for a lot of education we do," Probert adds. He also uses shopping scores in the aggregate. "Mystery shopping allows you to look at a manager's performance as well as that of individual salespeople," he says. "I have to look at the managers, and what areas they need to improve upon because the performance of the salespeople is a reflection on their hiring and recruiting as well as their educational programs." Overall, he uses the scores along with related metrics as "a report card on how we are doing as John Laing Homes," he adds.

Because of its power and versatility, broader use of mystery shopping is on the rise. Probert has already expanded the program to evaluate sales follow-up and telephone skills. At Morrison Homes, John Rymer uses it to evaluate e-mail performance.

"We've had a lot of success in the last two years with e-mail mystery shoppers where we send e-mail requests for information and time how long it takes to get a response," Rymer explains. "That's been very enlightening, very informative."

And several builders have plans to expand mystery shopping use. Probert is about to mystery shop the company's design centers and mortgage reps, for example. And as for the future, Probert says, "I think mystery shopping is going to move into every area where anybody in our company interfaces with the customer."

--Jay Holtzman is based in Jamestown, R.I.

Savvy Shopping

Here are tips for getting the most out of mystery shopping as a sales training tool.

  • Inform employees formally and in advance that they will be subject to periodic mystery shopping.
  • Make mystery shopping a positive experience. Position and use it as a tool for personal growth and improvement.
  • Train managers how to use video shopping. Managers must use them with care, or they can cause more harm than good.
  • Mystery shop regularly. Make a schedule and stick to it to foster continual improvement.
  • Mystery shop consistently. In bad times, salespeople need the sharpest skills possible. In good times, they may slack off and become order-takers.
  • Have salespeople grade their own performance. Then have them sit down with their manager to plot a training course. Self-criticism is easier to take and salespeople more readily accept shortcomings in their performance.
  • Make a highlight tape. Compile the best mystery shopping performances and share them with the sales team. It can be more effective to learn from peers, and it can boost morale for good performers.