Office Depot CEO Talks Mystery Shopping

Re-reading an HBR article contributed by Office Depot’s 2011 President Kevin Peters we were struck by not only his amazing commitment to identify with the customer, but his conclusions, many of which we speak about on a daily basis. But, let’s face it, the President of Office Depot contributing to the Harvard Business Review (HBR) is far more alluring. There is somewhat of a timeless nature to Mr. Peters’ comments, so we view them as relevant today as they were the day they were published. But, don’t take it from us, take it from Mr. Peters:

“When I became the leader of Office Depot’s retail stores in the United States, in 2010, the first thing I tried to do was figure out the meaning of a puzzling set of facts. Our sales had been declining, and although that’s not unusual in a weak economy, they had declined faster than the sales of our competitors and of retailers in general. At the same time, the customer service scores our third-party mystery-shopper service was reporting were going through the roof. This didn’t make any sense. How could it be that we were delivering phenomenal service to our customers, yet they weren’t buying anything?”

We see this quite often when we take over programs for organizations that didn’t initially begin with our brand. Mystery Shop is such a multi-faceted industry, but it only measures the aspects you give it authority to measure, which means if you aren’t asking the right questions, you aren’t getting the right answers. And, this is what Mr. Peters eventually uncovered after doing his own mystery shopping.

“…We were asking the wrong questions. We were asking, Are the floors clean? Are the shelves full of inventory? Are the store windows clean? Have the bathrooms been cleaned recently? Think about that for a moment: How often do you go to the bathroom while shopping for office supplies? It turns out that customers don’t really care about any of that. Those factors don’t drive purchases, and that’s why our sales were declining. It would be easy to blame our associates for ignoring shoppers, but under the system we’d built, they weren’t doing anything wrong. They were doing exactly what we’d asked them to do—working to keep stores clean and well-stocked instead of building relationships with customers.”

What Mr. Peters eventually did with the data was even more impressive.  Our goal is always to positively impact an organization and many times that comes in identifying which aspects of a customer visit mean the most to them – and then focusing on those aspects from a training perspective.  Mr. Peters did just that, and much more.

“Once our associates had more time to serve customers, we needed to ensure that they knew how. We simplified our sales process from five steps to three—it’s now called ARC, for “Ask, recommend, and close”—and trained them to implement it. We taught them to ask customers open-ended questions. Our research indicated that in certain departments—such as furniture—sales go up by more than 100% when associates with really good product knowledge are assigned to those zones. So in addition to sales training, we invested in product training.”

Mr. Peters’ words are an amazing reminder of how focused our programs and organizations should be.  And, because this article is about him, we’ll give him the last word.

“You also have to make sure you’re measuring things that really matter to customers. I can tell you from firsthand experience what happens when you measure the wrong things. I always try to remember that we need our customers more than they need us—and we’d better act like it.”

READ THE FULL HBR ARTICLE HERE