Inside the Customer Experience

Mystery Shopping Tests Compliance Issues

Compliance issues, or failure to adhere to compliance standards, can make or break a business. This is especially vital in the financial industry, whether it is banking, loans, mortgages, or tax preparation. With the laws becoming more stringent, it is vital to ensure that staff are providing accurate information, the proper disclosures, and are as transparent as they need to be to ensure compliance.

Mystery shopping has helped in monitoring and measuring compliance among staff in this industry. Starting a program can be beneficial and will help businesses learn more about what consumers are being told, and be sure that employees are compliant with the law. Below are some examples:

Personal and “payday” loans: this type of loan has been in the news in recent years, as they have been hit with insanely high interest rates and some policies that are not clear to consumers when they use these services. A mystery shopping exercise can be initiated in which shoppers apply for these types of loans, whether in person or online, and document what they are told about the loan process, the repayment system, and interest rates. Additionally, they can attach documentation, such as required disclosures (Truth in Lending as an example) that need to be given to each consumer, as proof that this step was done. If there is a time where a shopper does not receive these disclosures, it is an immediate red flag to the company.

Auto insurance: this is another area for compliance issues. A recent study revealed that approximately half of consumers shopping for auto insurance do not disclose all relevant information during the application process. If there are “typical” aspects consumers tend to omit, a simple mystery shopping exercise can reveal which staff take the additional steps to ensure there are no omissions or find additional information and which just “let it go.”

Liquor and tobacco: while not in the financial industry, this is another aspect that can harm a business if compliance is not strictly followed. Starting a program in which mystery shoppers in the appropriate age group (18-27) will purchase alcohol or tobacco products to evaluate if staff request identification, inspect the identification, or if they simply override the system.

Utilizing a mystery shopping program to proactively monitor compliance issues can save a lot of headaches and trouble down the road. Mystery shopping is traditionally thought of in the retail and restaurant industries, but it can be useful for more complex programs as well.

Amazon’s Return Policy: Over the Top, or Okay?

Return policies can help or hurt a business. Amazon has been making news lately with theirs – it seems as though they have been known to cancel Amazon accounts that meet the criteria for “account abuse.” But what does that mean exactly?

Just from reading reports, it’s difficult to know for sure. Users have reported having their accounts deleted for 7% return rates up to 11%. Return rates depend on the number of items purchased through Amazon vs. how many have been returned.

Amazon’s return policy does not say anything specific about this issue; it simply states: Items shipped from Amazon.com, including Warehouse Deals, can be returned within 30 days of receipt of shipment in most cases. Some products have different policies or requirements associated with them.

There have been reports circulating of people’s accounts being canceled, along with any gift card balances and/or Prime memberships. It is unclear as to whether these customers received a warning from Amazon before their accounts were closed. At any rate, is this excessive?

Maybe. Maybe not.

Retailers try to offer a liberal return policy where possible to improve the customer experience. It’s typically a few bad eggs that ruin it for the majority, and is the reason that other retails do track returns to look for patterns. This is what the retailers are up against:

Those who borrow, not buy: most often in clothing stores, people will make purchases of clothing items with the intent to return once worn for a special event or similar situation.

Returning to replace: need a new electronic item? Is yours not working properly, or just old? Some consumers have been caught purchasing a new item, and then using the receipt to return their old item, essentially making the purchase free.

Shoplifting at its finest: consumers have also made legitimate purchases, and later returned to the store, found the items on the receipt, and proceeded to the customer service desk to make a “return” on these not purchased items, essentially shoplifting.

Retailers are in a tough spot – how do they prevent fraudulent returns while not placing the burden on the majority of consumers who are not engaged in any type of shady behavior? Some, many are big box or electronics stores where this type of behavior happens most often, have turned to requiring identification for all returns, regardless of having a receipt or not. This information is housed in a database to look for patterns that might signal an issue. Other retailers have a more liberal return policy.

It’s a fine line for retailers to protect themselves while ensuring customers have a great experience from beginning to end; however, I believe that retailers do need to be more forthcoming with their policies regarding potential return abuse and work closely with customers who may find themselves in this situation. Being more transparent on these policies will give customers an understanding of the “why” behind it and may make them less wary to make a truly needed return.

Customers Feel They Aren’t Being Heard – Here’s What You Can Do

The 2016 Customer Experience report was released recently, and many of the findings highlight how customer service is failing. One highlight focused on customer feedback and a potential reason as to why customers do not provide it when asked.

Respondents shared their thoughts on whether or not companies took action based on feedback provided. As you can see from the slide below, the overall thought that companies did react to feedback declined since 2013, from 49% saying that it was extremely likely or very likely that companies respond to 31% in this study. Similarly, the perception that it was very unlikely or extremely unlikely that companies would react rose 12 percentage points between 2013 and now.

This may or may not be true; companies could be taking in the feedback and making actionable changes, even if it’s not apparent to customers. But, if a tree falls in the forest and no one hears it, does it make a sound?

When customers take the time to give a company feedback, they want to feel that their voice is heard. There are some ways that companies can send the message to their customers that will likely improve satisfaction and encourage customers to continue to share their thoughts.

Close the loop: this is likely the most time consuming way to show that a customer’s voice is heard, but it can be very effective. When a customer has an issue, follow up with the customer once it’s resolved. It’s important to do a few things here: 1) Make sure the issue is actually resolved; if not, make sure it happens ASAP, 2) find out how the customer perceived the resolution process and ask for suggestions on improving it, and 3) follow up with a note of thanks for their feedback and let them know the ways that you are working to make a better experience in the future.

Share feedback findings with your customers: whether it’s on your website, on your social media sites, or in email marketing campaigns, it’s wise to incorporate a “We hear you” message. Let customers know that you DO listen to feedback, and share some of the ways you’re making improvements. Even if they are minor changes or updates, it will send customers a positive message.

Highlight the negative feedback: this may seem counter intuitive, but it can be an effective means of letting customers know you listen. Similar to sharing findings, you can highlight a customer issue and directly show how you’ve worked to make improvements. Include customer information, such as a first name and even a photo (with their permission), and follow up with them to get their thoughts on your plan to improve. It’s personal and sends a strong message to your customer base.

Get your customers involved: are you seeing a trend in a particular issue that seems to be a pain point for many customers? Get them involved in making change. When customers leave contact information, it’s easier to reach out to ask them if they’d take part in a focus group or online survey that digs deeper into that particular issue. It’s a double win – you are making customers be part of the process while gaining even deeper insight into customer perception. Additionally, it can create increased loyalty, as you are turning dissatisfied customers who may be on the verge of walking away into part of the solution.

Consumers are inundated with feedback requests constantly; it’s no wonder the response rates have dropped and customers feel like it’s just one more thing to do. Make the most of your program and stand out by utilizing some of the ideas above.

Have you found success in creating an effective feedback program? How do YOUR customers know you’re listening? Please share your thoughts in the comment section and let us know!

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