Case Study: The Impact of Mystery Shopping on Automotive Parts Pricing

Project Overview

This project was initiated to uncover the real prices of 100 essential automotive spare parts for nine different car brands/models in the Iraqi market. The objective was to gather accurate pricing from various channels, ensuring a comprehensive view of the market landscape. The pricing channels included retail prices of original parts from brand representatives, retail prices of original parts from multi-brand stores, retail prices of non-original parts from multi-brand stores, and wholesale prices.

Methodology: Mystery Shopping

To obtain genuine market prices, a mystery shopping approach was employed. This method was chosen to discreetly collect data without influencing the sellers' behavior. Mystery shoppers were deployed to gather prices from different channels to ensure the data's accuracy and reliability.

Execution

1. Selection of Parts and Brands: A list of 100 spare parts essential for the functioning and maintenance of the vehicles was compiled. Nine popular car brands/models in Iraq were selected for this study.
2. Identification of Sales Channels:

• Brand Representatives: Authorized dealers and brand representatives selling original parts.
• Multi-Brand Retail Stores (Original Parts): Stores offering original parts from multiple brands.
• Multi-Brand Retail Stores (Non-Original Parts): Stores selling aftermarket or non-original parts.
• Wholesale Distributors: Suppliers offering parts in bulk.

1. Mystery Shopper Training: Individuals acting as mystery shoppers were trained to ensure they could effectively gather the required information without revealing their true purpose. Training included:

• Identifying and verifying the parts.
• Approaching sellers with consistent queries.
• Documenting prices accurately.
• Capturing visual evidence discreetly.

1. Data Collection:

• Retail Prices from Brand Representatives: Mystery shoppers visited authorized dealers, posing as regular customers, to obtain prices for original parts.
• Retail Prices from Multi-Brand Stores: Shoppers visited multiple stores to compare prices of original and non-original parts.
• Wholesale Prices: Shoppers approached wholesale distributors, inquiring about bulk purchase prices to gather wholesale data.

Results

The mystery shopping efforts yielded a comprehensive dataset of spare parts prices across different channels. The findings were categorized by:

• Brand: Each of the nine car brands/models.
• Sales Channel: Original parts from brand representatives, original parts from multi-brand stores, non-original parts from multi-brand stores, and wholesale prices.

Deliverables

The final deliverables included:

• Excel Price List: A detailed spreadsheet outlining the prices for all 100 spare parts, categorized by brand and sales channel.
• Field Operation Reports: Documentation of the field activities, detailing the approach and findings from each visit.
• Visual Reports: Photographic evidence of the parts and prices from the targeted stores, providing visual validation of the collected data.
• Analysis and Reports: Comprehensive analysis of the collected data and detailed reports to assist in strategic decision-making.

Conclusion

This project successfully demonstrated the effectiveness of mystery shopping in collecting accurate market data. By maintaining the anonymity of the shoppers, the project ensured the authenticity of the gathered prices, providing the client with a clear and realistic view of the automotive spare parts market in Iraq. The comprehensive data collected will enable informed decision-making for pricing strategies and market positioning.