“ This year, as well as in 2016, the bulk of assets under management per client were between R3m and R10m ”

- 2017 Top Private Banks & Wealth Managers survey

“ 60% of private bank clients rate the quality of advice they receive as ‘very good’ or ‘excellent’ ”

- 2017 Top Private Banks & Wealth Managers survey

“ 57% of clients rate their broker's service as excellent, up from 40% last year ”

- 2017 Top Stockbrokers survey

“ 6% of stockbroker clients execute trades worth more than R100,000 a month ”

- 2017 Top Stockbrokers survey

“ 40% of stockbroker clients average monthly trades of R5,000 or less ”

- 2017 Top Stockbrokers survey

“ 42% of clients chose their broker through word-of-mouth recommendations ”

- 2017 Top Stockbrokers survey

“ Of the 100 largest JSE-listed companies, 87 conducted BEE deals, 35 of which included public benefit organisations ”

- 2017 Empowerment Endowment

“ R32.6bn in endowments are now held by foundations set up as a result of BEE deals that will support charitable activities ”

- 2017 Empowerment Endowment

“ The percentage of wealth management clients who are “extremely likely” to recommend their institution declined to 53% from 78% last year ”

- 2017 Top Private Banks & Wealth Managers survey

“ This year, 35% of wealth management clients say they receive excellent value for money, down from 54% last year ”

- 2017 Top Private Banks & Wealth Managers survey

“ More than 70% of wealth management clients rate the quality of the advice they receive as ‘very good’ or ‘excellent’ ”

- 2017 Top Private Banks & Wealth Managers survey

“ R51.6bn value created specifically for charitable recipients through BEE deals ”

- 2017 Empowerment Endowment
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Researching Capital Markets and Financial Services

Category: Archive

Demystifying mystery shopping

By Heidi Dietzsch

There is really nothing mysterious about mystery shopping. The aim is to seek clarity, not to create mystique. The research method works well for many companies and, if used correctly, can be a powerful tool to differentiate businesses from their competitors.

Mystery shopping entails individuals posing as a normal customer to gain information about businesses, evaluate products and services and check regulatory compliance. Market research companies are usually commissioned to conduct mystery shopping for clients.

The term “mystery shopping” was coined in the 1940s when the method was introduced. Back then it was conducted by private investigators, no less, who checked the integrity of employees, especially in banks. The method evolved to become an accepted practice in many different industries, particularly banking, retail, petroleum, fast foods, hospitality, telecommunications and automotive. Over time, mystery shopping has boomed into a multibillion-dollar worldwide industry.

In a mystery shopping exercise in banks, for example, shoppers will typically evaluate: the cleanliness of the bank; the state of the exteriors and interiors; whether ATMs are working; whether ATMs’ security is up to scratch; the visibility of a security guard; the availability of promotional material; the ease of use of internet and telephone banking; the user-friendliness of the online banking website; the friendliness, professionalism and knowledge of staff; and whether additional products and services are promoted.

No specific qualifications are required for a person to become a mystery shopper, but they need to be able to observe and blend in with normal shoppers without disclosing their intentions. However, it is very important that they are well trained, especially when video or audio equipment are involved. They also need to be computer literate and have a great deal of integrity.

After a mystery shopping evaluation is conducted, shoppers will typically complete a bespoke, pre-designed questionnaire, usually on a mobile device. This means that they also need to have a good memory since these questions cannot be completed during the evaluation.

The responses will be sent to the client in the form of an electronic report, which will be used for a variety of things. Typical examples include new product development; the creation of marketing campaigns; identifying weaknesses in systems; the training, development and incentivisation of staff and measuring competitiveness through benchmarking against peers.

Businesses should not use mystery shopping findings during disciplinary hearings or to motivate dismissals – for example, by assessing service levels of a bank teller and using that against the employee – as it raises numerous ethical issues.

Mystery shopping is also highly resource intensive and therefore costly.

The main aim of mystery shopping is to improve customer satisfaction levels and retain customers. Shoppers should therefore understand that mystery shopping is a serious business and success depends on their professional conduct.

However, businesses should realise that mystery shopping findings are a snapshot of a moment in time. For instance, on that specific day the business might experience an unusual crisis or an employee might have a particularly bad day. Findings that are recorded in such extraordinary circumstances might not be a true reflection of normal day-to-day business. It’s important therefore to conduct numerous evaluations spread across branches and towns and cities.

A perturbing aspect of the process is that it may violate the principle of informed consent, as staff are not always aware that they are being observed. Staff might also feel threatened and think that management is spying on them and that they are not trusted. However, if the findings indicate that staff performed well, this could be a great motivation for them, especially if some sort of award is involved.

The banking and retail industries are being transformed by digital experiences, which comfortably facilitate mystery shopping research –  although it is still finding its place in the digital, big data world.

If used wisely, mystery shopping can produce information that cannot be garnered with more traditional research methods. Businesses will always need to know about their customers’ experiences – and this is where mystery shopping’s strength lies.


FM to publish tax-free savings guidebook

The third Guide to Tax-Free Savings, produced by Intellidex’s sister site, savetaxfree.co.za, will be published in the Financial Mail at end-January.

The guide serves as a useful reference for all investors wanting to use TFSAs to boost their portfolios with tax-free returns. It contains everything an investor will need to know, ranging from the costs of each TFSA, minimum investments amounts, the ideal investment period and the risk profiles. 

This third, updated edition of savetaxfree.co.za’s Guide to Tax-Free Savings Accounts is designed to provide new and experienced investors with everything they need to know about TFSAs.

Read the previous edition here.

Ansys is SA’s Most Empowered Company

The most empowered company in 2017 is Ansys Ltd, an AltX-listed company that specialises in the design and development of IT systems. It operates under the ICT Sector Code.

Empowerdex Research & Advisory conducted the research and Intellidex produced a 16-page supplement to Business Report, the media partner for this research project, which was published last week. Ansys received its award at a dinner event where ANC treasury-general Dr Zweli Mkhize was the keynote speaker.

Other awards went to:

Most empowered black-owned company: HCI

Most empowered black-managed company: Vodacom

Most empowered company (old codes): Nedbank

For the full report, click here.