You’re a retailer. You’ve done well for the past decade. After being the sole provider of the service you offer in your area, a competitor sets up shop a few miles from you.
At first, you keep a cool attitude about the future of your business—after all, you’ve had extremely satisfied customers for years now. What could this competitor possibly do to disrupt such customer loyalty?
Several months after the competitive opening, earnings begin to slide. It appears you’re losing business to the new retailer.
Not knowing why the other guy is doing so well can be extremely frustrating. But there’s a creative way around this problem: mystery shopping companies can provide competitor research data directly from the floor of a bricks-and-mortar competitor, the way a customer experiences them.
Conducting competitor research is certainly nothing new to the business world, but the means by which a retailer can receive actionable competitor data are now much broader given how connected we all are.
Benefits of Using Mystery Shopping Companies for Competitor Research
Let’s look at some of the benefits an effective competitor research plan can have on your business:
- You’ll keep an eye on your competitors’ customer experience strategy.
- You’ll be better able to generate market forecasts.
- You’ll have a better understanding of overall traffic with competitor traffic studies.
But in order to glean actionable data, mystery shopping companies like StellaService must customize a program specifically for the purpose of competitor research.
Generalize a Mystery Shopping Program to Get the Big Picture
When it comes to traditional mystery shopping programs, survey data is usually geared towards specifics since companies are afforded the luxury of knowing exactly what they’re looking for. When aimed at a competitor, it’s more useful to back off of specifics since you’re more or less in the dark about their customer experience strategy.
Forming survey metrics based on what your company values assumes that competitors aim for an identical customer experience. For instance, if you gauge active customer engagement by timing how long it takes for an associate to greet you upon entering the store, and no one ever does, you run the risk of interpreting it as a fault since competitor associates may not be trained to actively engage customers upon entering a store.
Instead, formulate an initial list of the strengths and weaknesses you perceive might be at work. Use this list to guide the content of your survey and craft the questions to assess the broadest possible array of customer experience strategies.
Mystery Shopping is a Proactive Way to do Competitor Research
You have some alternatives to using mystery shopping for competitor research—but they’re mostly guesswork.
A group of executives debating over what a competitor might be doing to attract consumers and formulating a plan based on this flimsy assessment runs the risk of completely missing the target when it comes to understanding what’s actually working.
Contracting a mystery shopping company for competitor research erases uncertainty by putting shoppers with an eye for customer experience into a competitor’s physical location. With skilled shoppers trained to spot the nuances in a company’s approach, the usefulness of your analysis hinges mostly then on the quality of your survey questions.
How to Get The Most from a Competitor Mystery Shop
As I stated earlier, you may have experience working with mystery shopping programs internally, but using it for competitor analysis requires a slightly broader approach.
Since you’re more or less in the dark when it comes to what your competitor is trying to achieve through customer experience, broaden the scope of your survey to include topics such as:
- Product comparisons—What is the overall quality and appearance of their products?Having this data will better allow you to compare your experience to theirs.
- In-store layout and design—Does the layout of the store reflect an intuitive design plan
- Associate engagement—How do employees engage with customers? Is the strategy passive or active when it comes to assessing customer support? This will indicate a failure of associate execution, or could perhaps be evidence of executing a different strategy altogether.
Generate Actionable Results
In order to use your survey data effectively, you must evaluate it with the goal of identifying a competitor’s distinct advantage.
Once you’ve accomplished that, and along with an actionable plan for improvement, you can make proactive changes to your customer experience strategy by bolstering those areas where your competitor is lacking.
Be sure your new customer experience strategy adheres to these important ideas:
- The strategy revolves around solving a specific problem or need to which customers are responding positively.
- The strategy is realistic given your financial capabilities—but keep in mind that the majority of behavior-based changes won’t cost anything at all, for example saying ‘Hello’ upon entry, determining customer needs, and adding a simple thank you at purchase time.
- The strategy doesn’t shift the focus away from your target consumer, i.e having the goal of recapturing lost customers vs. gaining a completely different set of new customers.
If you’re a new business trying your hand in an already satisfied market, mystery shopping can offer valuable insight into what competitors aren’t offering their customers. If you’re an established business contending with new competition, mystery shopping can show you what the new guy is bringing to the table.
Making an investment in an effective competitor research plan can provide substantial long-term returns if you’re willing to use the data to apply a new approach to your in-store experience. Learn more about how StellaService can help you with your competitor research, by contacting us here.