"The Mystery Shopper"

By Ken and Kelly Orchard

There was an article recently in the Los Angeles Times about "Mystery Shoppers". For those readers out there not familiar with this type program, it is offered to organizations to test the customer service, product and overall impression of their business.

Shoppers dressed in simple apparel, like blue jeans, t- shirt and tennis shoes (basically anything other than a business suit) come to a targeted place of business, like a grocery store, where they shop, buy some groceries and check out in your customer line. After they check out they go out to their car and write a report on how the experience was. Depending on the business, the outcome of the report will bring employee’s praise or dismissal. Companies all over the country are using services like this. All sorts of service industries like grocery stores, fast food chains, hotels, cruise lines, even property management companies hiring mystery shoppers to pose as potential tenants, and doctor’s offices hiring them as undercover patients. It’s an interesting way to know just how your company is doing, and it got us to wondering:

This mystery shopper program has been going on for 40 years but recently, according to this L.A. Times article, is there is a new heightened attention to customer service, which has slipped in recent years amid the nation’s tight labor market, high worker turnover and layoffs. Some large companies are now doing this mystery shopper on their own. Recently McDonalds has launched its system wide use of undercover shoppers.

We’ll get back to that point in a minute. We want to share some of the things we learned at the National Association of Broadcasters Convention last month in Las Vegas. We attended many sessions regarding issues that are important to broadcasters today, EEO & Employment Law, which has had its pros and cons in the broadcast industry, and of course FCC Enforcement and we were even able to attend the FCC Chairman’s Breakfast with Sam Donaldson and Chairman Michael Powell.

First of all, it is really no secret that the Enforcement Bureau of the FCC is out and inspecting stations all over the country on a regular basis. The list of actions (from the FCC Website) for March 2002 shows a total of 116 FCC actions taken. These are Notice of Violation, Notice of Liability and even Forfeitures, ranging from $8,000 to $10,000. The list showed the following as items the FCC cited stations for:

these are items from as recently as last month that stations have been cited for non-compliance.

During one of our sessions, we learned that the FCC’s new budget has been approved, and along with their additional Enforcement Staff, they have also been approved for travel expenses. What does this mean? The FCC now has additional budget for travel to increase the amount of stations to inspect in 2002 and beyond. And, if you watch how many they have already been performing each month, what do you suppose the odds are before your station is inspected?

One of our favorite panelists at the NAB is attorney Barry Umansky. He wrote a submission for the convention titled, "Putting Your Station’s Regulatory House in Order", and it included a checklist about specific areas that stations need to "Spring Clean" this season. Umansky says, "It’s an opportune moment to clean out some bad behavior and ensure a lawfully-run station." Could be a job for our fictitious "mystery shopper". Umanksy’s checklist included:

This list of clean-up items, provided by Attorney Barry Umansky at the convention can help insure at least a Spring and Summer free of FCC fines or other legal and regulatory jeopardy.

Another issue plaguing broadcasters today is the EEO and Employment Law. We attended this session, and it appears that new rules are on the way. Whatever your position is, it’s important to follow the rules. Whether or not the FCC requires broadcasters to report all their recruiting efforts or not is going to be an ongoing discussion for a long time. Yes, it means more paperwork in an industry where hiring and maintaining quality employees are a challenge. There are proposed outreach requirements and record keeping requirements, reporting and enforcement requirements, and filings with the commission. It can all seem cumbersome to broadcasters, but it could be and probably is, a necessary evil.

Roy Stewart of the FCC commented, "We’re trying to get a comprehensive approach to EEO issues."

Recruiting should really be diversified, but Jenell Trigg of the Law Firm Leventhal, Senter & Lerman stated, "The rules don’t mean anything if you can’t implement them for hiring talent, engineering and sales."

Its important to be pro-active on this issue, and comments have been welcomed at the FCC from broadcasters. Does it help to sit and complain about it without participating in the process? No.

One key comment that broadcasters should pay attention to was one made by Jenell Trigg, "Record keeping should be done anyway. Whether there are FCC rules regarding EEO or not, you could still be sued for discrimination."

Although overall attendance at the convention was down from 110,000 in 2001 to 95,000 in 2002, it was a great convention on the floor and vendors felt that the slightly smaller attendance was a benefit because they could take more time in talking with potential buyers of their services or products. However, there are still ways that need to be improved in the future.

The FCC Chairman’s Breakfast with Sam Donaldson of ABC interviewing FCC Chairman Michael Powell in a sit down interview was standing room only. Now this is where the mystery shopper should have showed up. We were fortunate to find a table and sat in the front because we got there early. We were able to hear the audio okay, but the people in the back could not. In fact, fellow broadcasters, if the mystery shopper or mystery audio person came through on most of the sessions, the convention bosses would have received a "F" in the handling of the P.A. system.

Later that day there was another seminar with two FCC Commissioners and nobody could hear. This is a Radio convention where what we offer to the public is our audio, our presentation to the public. We were not the only attendees appalled at the lack of quality in audio efficiency. If NAB has not complained yet to the Las Vegas Convention Audio Staff, then let us be the first to say that the audio P.A. Systems were terrible. We experienced poor audio in every session we attended, from feed back to mikes not working, or just not hooked up right. The "Mystery Shopper" would have given a negative report on the overall presentation ability of this broadcasting convention.

Lets return to the concept of the "Mystery Shopper". We brought up the subject regarding the audio problems at the NAB convention, but what about problems with your station? Wouldn’t it be nice to know that you received a positive report about your station when the "mystery shopper" came? How does your receptionist greet visitors? What about the sales department? Do they present your station and company in a manner fitting to its ownership? How about promotions, contesting, traffic and billing? Ratings are one thing, the audience fills out diaries to tell Arbitron how your are doing, but what about the rest?

The FCC isn’t exactly a "mystery shopper", but your state association can act as one. More than 40 states offer the Alternative Broadcast Inspection Program (ABIP), which is fully endorsed and encouraged by all FCC officials. Your station simply pays a fee, and the association contractor will come out to your station and perform a "mock" FCC inspection. Whether you pass or not depends on how well you have complied with the regulations.

It’s really up to you. You can "do it yourself", the FCC Website does offer an FCC Inspection Checklist, you can participate in your state association’s program, you can fix the problems and have a year of no FCC problems.

Or you can do what it appears that hundreds of stations across the country do each and every month. Wait for the FCC to show up and issue Notice of Violation, Notice of Liability, issue fines and forfeitures and generally cause you more grief than had you taken care of these matters pro-actively.

We’d opt for the "Mystery Shopper" approach and get that "Get Out of Jail Free Card" that stations who pass the state associations ABIP provides.

Avoid FCC fines. Orchard Media Services can help you with your FCC Compliance obligations. Call for rates on all services. OMS will come to your station. Soon we will be in Oregon and Washington, this summer we’ll be in the mid-West. We can perform a "mock" FCC Inspection, evaluate your Public Inspection Files, Political Files, Station Logs, EAS Compliance and other FCC rules and requirements. We just complete two FM stations in Los Angeles and a television station in Los Angeles. We have worked with over 125 Radio and TV stations in the USA. Call Orchard Media Services for questions and information at 760-243-4733 or via email @ PIFILE@aol.com.