Mystery Shopping Blues: Annual Report Card Reveals Much Room for Improvement

Each year, as part of the Leadership & Development Conference, Franchise Update offers franchisor attendees the opportunity to have their sales operation mystery shopped. Our mystery shoppers pose as qualified prospects, phoning in to the franchise sales department, and submitting applications online. The results are presented at the conference in September, and made available in the Annual Franchise Development Report. Here's what we found.

Telephone mystery shopping

So, when qualified prospects call your sales department, they're immediately connected to a live sales rep, right? In your dreams. In the real world, calling in to the 116 franchisors who asked us to mystery shop them, our callers reached a live person just 16 percent of the time. That's down from last year's semi-dismal 23 percent. More than 8 of every 10 calls resulted in messages left on voicemail or with a receptionist.

Okay, so when did those messages get returned? In a few hours, right? Or at least that same day. No? Next day then, before the prospect called another brand. Nope, not that either. Almost half (48 percent) never called back the qualified telephone prospect. "That's amazing, especially today," said Olson. "Applause to the 52 percent who did respond," he said. These were qualified call-ins, he added, posing as interested buyers with the required funds and in the right geographic area.

"What does that tell you?" asked Olson. (And could this have anything to do with more companies asking not to be mystery shopped than ever before?) "Leadership starts at the top."

When our mystery shoppers did connect with a live person, many failed to ask the most basic questions:

  • Almost half (45 percent) didn't ask for the lead source. "This affects your budget, your forecasting," said Olson. "I learned, by selling, that it's a hassle. You really have to instill that. You must find out what the sources are, or you're going to waste thousands of dollars every year."
  • One in four (26 percent) didn't take a telephone number. Olson didn't even try to explain that.
  • Almost half (45 percent) failed to take an email address.
  • One third (32 percent) did not qualify experience.
  • Nearly one third (29 percent) did not qualify financing. "I don't understand. I would think it would be 100 percent," said Olson.
  • Only one in four (25 percent) qualified intended start time.

Add this up, and a dismally large percentage failed to take a phone number or email address, or to qualify experience, financing, or intended start time. As Casey Stengel, manager of the hapless, first-year New York Mets (40 wins, 120 losses) asked in 1962, "Can't anybody here play this game?" Talk about squandering leads!

Improving performance

Olson moved on to focus on how attendees could increase their follow-up performance to improve lead generation and conversion. Two tips:

  1. Go shop yourself. "Monitor your sales team," he said. "Only 38 percent have mystery shopped their sales people within the last 12 months. They're burning $43--or whatever they're spending per lead--every time they don't follow up."
  2. Employ a lead qualifier. Thirty percent do, he said. "I've always been a big proponent." He hired one when he was selling franchises. "I didn't mind paying them because sales went up." And, he added, consider outsourcing to a lead follow-up service. "If you're not prepared and structured to do it internally, at least talk to these people."

Website mystery shopping

The Internet is "the most powerful recruiting we've ever had in the history of franchising to date," said Olson. "Your franchise website showcases you. It's the first thing people look at," he said. And on your website, he added, "Content is king."

The question then is, How effectively are franchisors using it for lead generation and recruitment? This is exactly what our mystery shoppers set out to find.

To evaluate the recruitment websites and franchisors' follow-up performance, Franchise Update worked with mUrgent, an email and search engine marketing firm. Boris Bugarski, president and CEO of mUrgent, presented the findings on Thursday morning, following Olson's presentation of the telephone results.

Introducing Bugarski, Olson said, "The research shows how you can greatly increase lead generation from your own website and save tremendous sums of money."

Bugarski and his team analyzed and scored the websites of 93 conference attendees for this year's STAR Awards. (In another project, he analyzed 277 franchisor recruitment websites for front-end performance; 31 also allowed him to analyze their "live" back-end data. See story.) Their research of the 93 websites found the following:

  • 16 response forms (nearly one in five) could not be completed.
  • 57 percent never called the qualified lead.
  • 55 percent did not send return emails.
  • Only 35 percent responded within the first 24 hours.
  • One third (32 percent) of franchisors never responded at all.

They also found that one in three (32 percent) do not track their website data. The average conversion rate from unique visitors was 1.7 percent.

SEO 101

Have you tried typing "your company name + franchise" into the three leading search engines (Google, Yahoo!, and Bing)? That's what Bugarski did for the 93 websites. The results? On Google only, 12.7 percent were "no shows"--that is, they didn't show up in the top 30 results. When he did the same for all three search engines, the number of "no shows" rose to 14.2 percent.

These "organic rankings" are where search engine optimization plays a critical role in getting your company's consumer or recruitment website displayed early and often for prospective franchisees.

Bugarski emphasized the importance of SEO basics in your website to the first pages in search engine page displays. A look under the hood found a whopping 83 percent had "less than average page titles and descriptions to aid them in proper search engine rankings," he said. Nearly 4 out of 10 (39.2 percent) pages had no page description at all; and 8 percent had no page titles. These are what search engines look for. If you don't have them, they won't find them, and your home page will be pushed to the back of the (on)line.

Website navigation

Unfortunately, the old Mainer saying, "You can't get theah from heah," applies to cyberspace, in the form of website navigability. Even if you have the greatest content in the world (exciting prose, snappy graphics, sparkling video, and passionate testimonials), if visitors can't find any of it easily, you need to make serious changes--fast. Again, it's about knowing and executing the basics.

"Sites with a unique starting point and a clear learning 'path' that led visitors from page to page had higher conversion rates than those that did not," said Bugarski. Among the 93 sites he analyzed, 94 percent did not have a clear starting point for franchise shoppers.

Qualifying prospects online

Using the Internet to qualify prospects saves time, weeding out those who do not meet your minimum criteria, and saving your sales staff valuable time. So why did 44 percent of websites not post financial requirements? "They had a form, but no requirements," noted Bugarski.

The mystery shoppers also examined the relationship of the length of the online forms (short or long) to lead conversion. They found that sites with both a short and a long form converted "slightly" more visitors into lead than sites that had only one form; and that 36 percent of the STAR Award websites had both a short and a long form.

As for how franchisors responded to the forms submitted by our mystery shoppers, Bugarski catalogued three categories of response: mail, phone call, and personal email. Unfortunately, a fourth category, the largest by far, was no response at all. Nearly four in 10 (39.8 percent) of the mystery shoppers received no personal response to their qualified form.

Of those who did respond, one third did so the same or the next day, which Bugarski characterized as "fantastic." Another 14.6 percent responded within 3 days.

Bugarski closed by saying, "Thank you guys so much, and take care of your website." If you do, it will take care of you.

To download many of the presentations from the conference, visit

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