Unit 8 DB 1

Is the Shopper Panel a good idea or bad idea for Amazon and why?

In response to your peers, do you agree with your peers’ analysis?

This case explores the idea of paying customers for data submitted to Amazon and the opportunities for both the consumer and the company.

Ascarza, E. & Israeli, A. (2021, May). Amazon Shopper Panel: Paying Customers for Their Data. Harvard Business School.

CLASSMATE 1
Hello Class,
The Amazon Shopper Panel is an additional function within the Amazon shopping services. You can
only participate by invitation and win rewards by taking part in surveys. The opportunities to
participate in the Shopper Panel are very limited. If you do not receive an invitation, there is only the
option of being put on a waiting list directly via Amazon. The main purpose of the Shopper Panel is
to take part in surveys and rate Amazon products. There is also a function for activating ad reviews.
This provides Amazon with information on the current market situation (Amazon, 2024).
After briefly researching the topic, I would compare the system to a swarm intelligence. As a global
company, Amazon has many advantages in terms of creating synergies and generating sales. On the
other hand, the company’s size and global presence also pose a risk of not recognizing the marketspecific characteristics of the individual markets due to its size. A central information department, as
we know it from national companies, for example, would not meet the requirements of Amazon’s
global market. Amazon has therefore created a decentralized information tool in the form of the
Shopper Panel, with which information can be tapped directly at the decentralized point of the
consumer chain, the customer. Information in particular, such as the attractiveness of services and
competing offers, varies greatly between nations and even regions. Therefore, in my opinion, the
decentralized collection of information via the Amazon Shopper Panel is the right instrument for a
globally positioned company like Amazon.
Of course, I also take note of counter-arguments, such as paying for user data. However, I think that
this also happens on other platforms, such as Facebook or Instagram. Here only in an indirect form
by offering a third-party marketing platform.
I look forward to your thoughts!
CLASSMATE 2
Hey everyone,
To evaluate if the Amazon Shopper Panel is a good or bad idea, one must first understand what it is.
The Amazon Shopper Panel is a program where consumers can earn monetary rewards for
submitting receipts from other shops or answering surveys (Siddappa, 2022). Amazon utilizes this
program to collect consumer data at low costs. They are incentivized to do this because consumer
data can help optimize Amazon’s product portfolio and show better-targeted ads (Siddappa, 2022),
which in turn makes Amazon more money. Consumer data is essential in identifying product
portfolio needs and customer preferences. One might ask why Amazon pays consumers for their
data when they already generate substantial data from users on their platform. However, the data
Amazon can collect is limited to their own products and services, such as the website or Alexa. By
paying consumers for receipts from different companies, Amazon can collect more data, especially
from competitors, where they normally wouldn’t have access.
In my opinion, the Amazon Shopper Panel is a creative solution to an inherent problem Amazon
faces: the limitation of data collection. Incentivizing customers by offering monetary rewards is an
innovative way to gain new data access. This can be seen as a win-win situation, as consumers are
paid for their data, and in turn, the customer experience improves through enhanced product
portfolios and better-targeted ads. For Amazon, the improved portfolio enhances operational
effectiveness and makes the e-commerce market more attractive to customers. Better-targeted ads
increase the price advertisers are willing to pay. This is significant for Amazon, which made $47
billion in 2023 from advertising (Amazon, 2023). Moreover, advertising has a better margin than the
commission from sales on the platform, providing an additional incentive for better-targeted ads.
Thus, it is a win-win situation for both consumers and the company.
Moving away from the company view, it also improves Amazon’s position in the competitive market.
Because Amazon collects data from competitors with the Shopper Panel, it can react to potential
competitive disadvantages and address them. For example, if the data identifies a frequently
purchased product line from competitors, Amazon can introduce that product line to their own
offerings.
Overall, I think the Amazon Shopper Panel is a great idea for Amazon and a creative solution for
collecting data external to their own services. It helps Amazon improve the customer experience on
the platform, optimize portfolios, and show better-targeted ads. All in all, it is a good invention.
References:
Amazon. (n.d.) Annual Report 2023.
Amazon. https://s2.q4cdn.com/299287126/files/doc_financials/2024/ar/Amazon-com-Inc-2023Annual-Report.pdf
Siddappa, B. (2022, Jan 27). Amazon Shopper Panel — Ethical way of data collection?. Medium. Date
Retrieved: 2024, June 17. https://bhavis.medium.com/amazon-shopper-panel-ethical-way-of-datacollection-18b83c3d621f