How Does Mystery Shopping Work?

RoseHill, in her article "Get Paid to Shop: Mystery Shopping Tips from a Pro" has provided a wonderful overview of Mystery Shopping. As she points out, there are legitimate companies that hire Independent Contractors to evaluate stores, hotels, repair shops and many other businesses. Lists of these companies that shoppers have successfully used are included on free forums such as MSFreedom.org and Volition.com. But how does this process really work?

There are several hundred companies that hire mystery shoppers on a per job basis as Independent Contractors. You register on line with these companies, providing personal data that they need for both taxes and for matching you to appropriate jobs. You then go to the job board on the company's website and look for jobs in your area. Most of time there will be some restrictions on a job--perhaps that you have not shopped the location within 90 days, perhaps that you are age 21-27, perhaps that you do or do not have an account with the bank you are shopping, perhaps that you have a minimum "shopper rating" with that company. Now you look at the date(s) and time(s) that the job must be done in. You also will usually see the fee that is being offered and the reimbursement available for any required purchases. There is usually at least a brief description of what the job entails. If the job looks interesting to you and would work with your schedule, request it. On some sites, and with some jobs, you are allowed to immediately self-assign the job to yourself. You now have entered into a contract to perform and report that job in the time frame required and if you successfully complete it, you will be paid. On other sites you will have to request the job and a scheduler may or may not assign it to you. If they assign it to you, you will generally get an email telling you that the job is yours, but if you request it you should recheck the website in a day or two to see if it has been assigned to you. How long it takes to be assigned varies widely from company to company and within a company. But if the job is gone from the board and not in your list of assigned shops, you didn't get it.

With some companies you may need to take some certification tests to join them. With some you may need to take certification tests for a particular type of job before you can request it. With some companies you may need to pass a test after you have accepted the job but before you do it. This varies quite a lot, so read the websites.

Before you go out on the job you will usually need to do downloads from the website where you signed up for the job. Usually you will find fairly specific instructions for the job and you will need to print the questionnaire for the report. At an appropriate time you will go to the location specified in the shop materials and make the required observations and any required purchase. Here again there is a great deal of variation. Some jobs you can go any time the business is open over a week period, some you need to go a specific day, some you may need to go on a certain day between certain hours. There is a great deal of variety so make sure you mark your calendar! You will get a receipt for your purchase or pick up any other materials (business cards, pamphlets, etc.) that are required. When you leave the site, you will make notes of names, physical descriptions, timings or anything else that was requested in the report.

Within the time frame required (some companies want the report the same day you visit the business, some want it by noon the next day, you need to check the instructions) you will generally go back to the website from which you got the job and fill in and submit the report on line. You may need to scan and upload your receipt and other required materials into the report or in some cases you may need to send them by a separate email and in some cases you need to mail them to the company. Instructions for all this will be either in the instructions for your shop, posted on the website or in the general information they give you when you register with them. In some rare cases you may be actually filling out the paper questionnaire you downloaded and printed to mail it in.

Once you have done all you were required to do, you may still be contacted by phone or email by the editor who is working with your job to clarify details. Companies may contact you anywhere from the same day to two or three weeks later giving you feedback on your report and possibly a score for the shop. Not all companies provide feedback or scores and not all of them do it quickly. Keep a copy of the comments the editor provides to help you with future reports for that company because each company and each client may have slightly different ways they want reports handled. With some companies you can see on their website that your work was accepted, with others you have no idea whether the job was accepted or not. Do check the website after a few days to see if there are any comments or grades or issues they may have had with your report.

Now comes the wait. Your shop has been accepted. You have possibly laid out some of your own hard earned money to make required purchases. You are anxious to see your money back and your fee payment. While a few companies pay within days (and the emphasis here is a few), most companies pay in 30-45 days, some in 60-75 days and some you will have to contact repeatedly for payment. Make sure you have saved emails about the job and your job materials (or copies of them if you needed to mail the originals in) at least until you are paid. Some companies may have a requirement that you save your shop notes and such for 3 months, or 6 months or longer. It is safer to just have a folder for each month's work and throw them out once they are 18 to 24 months old. I personally keep mine for 5 years because I keep the receipts with my shop notes and if I were audited by IRS the information would all be there.

How will you get paid? When you sign up with a company (MSP), often you will be asked if you accept PayPal. That is definitely the best way to be paid. You will be notified when money has gone into your PayPal account and you have not had to give out your bank account information for a direct deposit. Some companies require direct deposit and that is okay, just not the best option. Paper check is the default and there are several problems with that. First, of course, checks can get lost in the mail. Second, frequently these checks are not too subtle and say "Mystery Shopper Account" or something similar or just use their company name on the checks which makes it a dead giveaway to the bank teller where and what the money came from and is for. It makes it harder to mystery shop your own bank when they know what you do for a living! Third, every couple of years a company gets into a financial mess and checks may bounce. While this is rare, it is costly to you for bad deposit fees as well as the potential of having subsequent checks you have written bounce. So given a choice, use PayPal. I have heard of only one company that reduces payments because of using PayPal (and they indicate PayPal is responsible for the 'fees'). Several companies charge for issuing checks, as their preferred payment method is PayPal. In the years I have mystery shopped I have never had a fee with PayPal for receiving payments, nor have I had charges for checks being issued.

The final basic issue is taxation. As an Independent Contractor, the MSPs (Mystery Shopping Provider company) will not withhold taxes. It is up to you to file your "business" on your tax return, claiming all fees, whether the MSP sends you a 1099 at the end of the year or not. This generally will not be a problem for you as there are enough legitimate deductions you can take against your business that your taxable income from this endeavor is likely to be small, especially in relation to the real benefit you get from it. But it does point to the necessity for keeping good financial records for your "business".

So Happy Shopping! As you first get started it will seem very confusing and complicated, but it gets easy. Remember the first time you tried to make cookies from a recipe? Or the first time you tried to fix a drippy faucet? Everything that is new has some degree of complexity that can lead to frustration and less than wonderful results. But keep trying!

As RoseHill also pointed out, you do not need to pay anyone to get shops. Shops available are posted on the companies' websites and once you are accepted by them as a shopper you can request or self-assign those for which you meet the qualifications. There is no cost to you to do this. You also need to make sure you are working with companies that you find on the Volition.com or MSFreedom.org websites that you see other shoppers are having good luck with. If you simply respond to a spam email about mystery shopping offering great deals you will find yourself being asked to subscribe to magazines, insurance quotes and all manner of stuff guaranteed to waste your time and money with no great shop at the end of the process. Be smart, shop smart!