Secret Shopper

Anne Chen

Secret Shopper Assignment Retailing Parsons the New School for Design Fall 2011

INTRODUCTION A secret shopper report on loss prevention was conducted in the women’s apparel department of the Nordstrom store located at Freehold Raceway Mall of Freehold, New Jersey.

The store was discreetly assessed, from the front to the back, such that underlying risks could be identified. Issues considered include point of entry, goods tagged, and changing rooms. Upon presenting findings to the store manager and requesting an interview to discuss internal fraud checks, the inquiry was kindly denied due to sensitive nature of such questions.

POINT OF ENTRY The first thing noticed upon entry into the store was the radio frequency gated doors, similar to the Ultra Max® anti-theft system gates mentioned in Diamond’s second edition of Retailing in the 21st Century. There were also SpeedDome® cameras placed all around the store, with most of them concentrated near the doors. There were no “quick grab” items in the front – merchandise at the front of the store was either well-styled on mannequins, or tagged and placed on racks. The racks were well-positioned such that they were in easy view of cashier/customer service desks. Items at the entrance were tagged with Supertags. As this was the apparel department, there were no small items, such as jewelry or accessories.

There was no salesperson available to greet entering customers, nor was there a security guard. Despite such absences, no other risks were identified at the entrance, as the store was well-monitored by cameras and other EAS system features. Salespeople would have to detach the hard Supertags with a detacher, or else the gated doors would sound an alarm. It was observed that merchandise had no RFID stickers, and thus concluded that Nordstrom just utilizes Supertags. However, no tags were attached to items that were in the Sale section; no RFID stickers were attached to such merchandise either. It appeared that the tag system is only used on regularly-priced merchandise.

To understand how the retailer addresses security for other product categories, the shoe and accessories department downstairs was then visited. Designer handbags were noticed to be anchored in place with cords. Jewelry, as well as perfumes and some cosmetics, were locked in glass cases, which were manned by salespeople. Each individual case was closely monitored by a salesperson, such that if an interested shopper wanted to view an item more closely, they would not have to struggle to seek out a salesperson to open the case for them. However, it was noted

that the constant presence of salespeople could potentially irritate shoppers who simple wanted to examine merchandise on their own. Upon close examination of shoes set on display, it was observed that such items were neither anchored nor had tags. As customers are free to handle these display samples, shoplifters can easily pop such display items into their bags, as it’s hard to notice such actions in the especially hectic atmosphere of the shoe department.

CHANGING ROOMS As changing rooms were locked, a staff member was needed for assistance. A few garments were selected by the researcher to maintain the visage of a regular shopper, but the sales women did not physically count the items taken into the fitting room; instead, she simply gave the bundle of garments a quick glance before unlocking the door. There were five items in total taken into the fitting room, but the sales associate didn’t inquire how many there were, nor did she mention a limit on the number of items that could be taken into a room. There weren’t any plastic numbers to be placed by each dressing room’s door either.

The changing room was observed to be clean and well-kept; there was no merchandise or empty hangers left in there from a previous shopper’s try-on. The walls of the room did not even touch the floor; there was a rather large gap between the changing room’s wall and the floor, such that a shopper could see the feet of another shopper in the room next to him or her. A small stool was placed for sitting convenience; it was solid, not hollow, and thus could not be used for stashing tickets or hangtags. The carpet was also pulled up and secured along the walls. There was nothing on the walls of the changing room, except for a mirror, a thin metal bar to hang clothes, and a sign that read: “DRESSING ROOMS ARE MONITORED BY NORDSTROM PERSONNEL”. Despite what the sign said, it was observed that the dressing rooms were not really being closely monitored. Even though a salesperson had to unlock fitting room doors for customers, they didn’t come back to check on customers in the fitting rooms; anyone could hold a door open for an accomplice.

Fortunately, there were no discernable ways for a shoplifter to hide tickets or hangtags.

However, as the salesperson did not seem to count the number of items a shopper brought into the fitting room, nor was a salesperson available upon one’s exit, it should be noted that security around the fitting rooms could be stricter. Moreover, as there was no assistance offered upon a customer’s finished try-on, a shopper would have to take it upon him or herself to put items back onto their appropriate racks on the floor.

OTHER INSIGHTS Upon discussion of the secret shopper assignment with a sales associate, the sales associate kindly agreed to call the store manager to see if a future meeting to discuss internal fraud checks could be arranged. The time spent waiting for the manager’s arrival was passed with further conversation about Nordstrom’s loss prevention strategies with the salesperson. She shared her personal experiences with theft and security as a Nordstrom employee. According to her, Nordstrom is the only retailer who allows their customers to return items purchased with a credit card for cash. When asked why the retailer has chosen to provide this option for their shoppers, the sales associate explained that Nordstrom “always wants to put their customers’ needs and convenience first”, and that many people desire the choice of getting cash returns. The disadvantage of having this option is that it results in a lot of fraudulent activity – many people use fake or stolen credit cards, buy an item, and then come back to the store and ask for cash back. Usually, if someone buys an item and returns to the store just a few hours later, salespeople

become suspicious, but if the customer is able to provide appropriate identification, there isn’t much that they can do. She said that there were plenty of times that she was doubtful of a customer’s honesty, but could not do anything without the proper evidence.

The saleswoman was then asked if Nordstrom uses tags other than the Supertags noticed on the retail floor, such as ink tags. She explained that she hadn’t heard of any retailers opting to use ink tags, as once the ink spills onto merchandise, the item is ruined. She had heard of Bloomingdales using ink tags on some of their items, but most retailers don’t think that this is a very wise option. “You wouldn’t believe how much theft, both from internal employees and shoplifters, costs us – this is why every new employee must go through a thorough and rigorous security training program, such that we are aware of the store’s security systems, and can assist in deterring potential theft and fraudulent behaviors!” she exclaimed.

By this time, the store manager had arrived. As it was a Sunday, the loss prevention manager had the day off. Unfortunately, the particular store manager who was on duty that day was a bit less receptive than the kind salesperson. She seemed at first suspicious of the researcher’s intentions, and claimed to have not even heard of Parsons before. However, upon further discussion, she agreed to talk to the regional manager to see if a future meeting, to discuss Nordstrom’s internal fraud checks, could be arranged. Unfortunately, as mentioned in this paper’s introduction, such an interview was denied due to the sensitive nature of such issues.