Amazon will pay you to know what you bought somewhere else
Source: Amazon

Amazon will pay you to know what you bought somewhere else

Amazon.com wants greater insights into what its customers are purchasing and it is willing to pay for the information.

The e-tailing and technology giant has launched Amazon Shopper Panel, an invitation-only program that allows participants to earn monthly rewards by sharing receipts of purchases made outside of its website and retail stores.

Participants in the program are asked to upload photos of 10 eligible receipts per month taken with the Shopper Panel app. Alternatively, they can forward email receipts to Amazon. Additional rewards are available when participants fill out short surveys. Amazon customers can earn up to $10 a month that can be applied to their balance on the site or donated to charity.

Participation in the panel is voluntary and those involved can choose to stop participating at any time. Amazon collects only the information shared by panelists. The company said it “deletes any sensitive information, such as prescription information from drug store receipts.” Amazon said all personal information of panelists is secured and handled in accordance with its privacy policy.

Amazon’s Shopper Panel site says that the data gleaned from receipts will help brands offer better products and make ads more relevant on Amazon.

In a message to brands, Amazon wrote that it “works with brands of all sizes to help them grow their businesses not just in our store, but also across the myriad of places customers shop. We also work hard to provide our selling partners — and small businesses in particular — with tools, insights, and data to help them be successful in our store. But our store is just one piece of the puzzle. Customers routinely use Amazon to discover and learn about products before purchasing them elsewhere.”

BrainTrust

"Given Amazon’s data mastery, I doubt its rivals can afford to prioritize imitating this move in the short term."

Lisa Goller

B2B Content Strategist


"It’s that age old dilemma: “I never knew” … “You never asked me!”"

Rich Kizer

Principal, KIZER & BENDER Speaking


"It’s one thing to say, here’s what our shoppers do, but another to say, here’s what our shoppers do and what happens when they go elsewhere."

Dr. Stephen Needel

Managing Partner, Advanced Simulations


Discussion Questions

DISCUSSION QUESTIONS: What do you expect Amazon to do with purchasing data acquired from its Shopper Panel members? Will other online marketplaces, such as Walmart, do something similar?

Poll

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Mark Ryski
Noble Member
3 years ago

Amazon is a data collection machine. But as great at data collection as they are, there are still some things they can’t know without asking. Undoubtedly, Amazon will use the insights to refine their own product mix and pricing. Shopper panels and surveying is old school, but it still provides insights that Amazon can’t get from their sales transaction and other data they collect. I suspect the other sophisticated online marketplace players are doing the same.

Neil Saunders
Famed Member
3 years ago

Amazon will no doubt use the data to help it better understand consumer trends and habits. That insight can then be used for all sorts of things from advertising and marketing to product development. The insight can also be used to help companies selling on Amazon, for which Amazon may be able to charge. In a way, this is no different from many other consumer panels. Using data and insights to help partner brands is also similar to what Tesco and Kroger did with Dunnhumby.

Paula Rosenblum
Noble Member
3 years ago

I think there are better ways to solve for this. Such a small number of receipts could really skew the selections you see.

Georganne Bender
Noble Member
3 years ago

Here’s Amazon again pursuing its goal for total world domination.

The program says participants are asked to upload 10 “eligible receipts” per month. Eligible of course is subjective with regards to what Amazon needs and my guess is that it will be more than 10.

It’s a volunteer program and I am certain a lot of people will be happy to sell their privacy for “up to $10 a month” not realizing what it means, or has the potential to mean. Personally, what privacy I have left isn’t worth up to 10 bucks a month.

Craig Sundstrom
Craig Sundstrom
Noble Member
Reply to  Georganne Bender
3 years ago

I’ve not much to add, but I’m sure glad someone brought up the broader potential impact(s). RW doesn’t usually ask us to evaluate strategies as “good” or “bad” — outside of a strictly business sense — which is probably just as well, but I sometimes wonder if it had been around in the 1890s would we have had questions like “Will XXX sabotaging its competitor’s refinery give it a competitive advantage?”

Georganne Bender
Noble Member
Reply to  Craig Sundstrom
3 years ago

Thanks, Craig! My company works primarily with independent retailers; we also study consumers. I am not a retail analyst so I tend to look at things a little differently.

Michael Terpkosh
Member
3 years ago

Amazon will use the data to try to sell panel members more product via Amazon. I am interested in how Amazon chooses shoppers to join their panel. It sounds like Amazon has squeezed all the shoppers insights it can from syndicated data shopper panel information. Maybe Amazon will get into the syndicated data business in the future?

Bob Amster
Trusted Member
Reply to  Michael Terpkosh
3 years ago

…unless Amazon can figure out how to extrapolate the data collected from Paula’s “such a small number of receipts.” Amazon will know the demographics of the shopper panel, will learn what they buy/bought somewhere else, compare the demographics of shopper panel to those of their entire known customer base and make inferences as to what to offer and how to price for the macrocosm of customers. Clever…

Brandon Rael
Active Member
3 years ago

We all know that consumer insights are the new black or the new oil. Amazon knows this and is offering something in return for your valuable transactional data. In this situation, the consumer has a choice and can opt in or opt out completely. If you are a loyal Prime customer then the question is, how will Amazon leverage these insights to drive a more personalized and localized experience for you?

Personalization does have a price, and it is your privacy. However in exchange for these valuable insights, we should expect the sophisticated data machine that is Amazon continues to evolve, to provide significantly more personalized offers and experiences.

As long as there is full and transparent communication as to what the data is being leveraged for, then most consumers will be running to opt into this service.

Lisa Goller
Trusted Member
3 years ago

Amazon’s curious about where else we’re spending time and money. Volunteers’ data will help Amazon refine and personalize its pricing, assortment and promotion strategies. Given Amazon’s data mastery, I doubt its rivals can afford to prioritize imitating this move in the short term.

Suresh Chaganti
Suresh Chaganti
Member
3 years ago

This is an extremely low cost way of getting market research data. They already know their own sales. They are doing this to have a good handle on what is happening outside their ecosystem.

Typically brands would pay $10 more for an interview on a consumer panel. We should expect Amazon to use the data to augment its own offerings as well as sell aggregated insights as an enterprise offering to the brands.

TAKU Retail
Member
3 years ago

Given their scale and customer base, this is a pretty cost-effective way to get data with nothing more than OCR technology. Only they would do something so blatant. It’s definitely one way to get at first party data similar to apps such as Checkout51 but how will the data collected be representative, even if they are likely targeting Prime members?

Raj B. Shroff
Member
3 years ago

They will use the data to gain insight into why people aren’t buying that item(s) on Amazon. If they start to see patterns, they will evaluate the LTV of getting into those categories; making their own private label, finding better vendors, adjusting pricing, etc.

I think others are doing this already but not in this fashion. Others are doing more isolated studies to answer specific questions. If Walmart or others with wide reach can translate this more longitudinal insight into some benefit then, yes, they will try similar programs.

Dave Bruno
Active Member
3 years ago

Ummm, no thanks, Amazon. Rather than trying to grab an even larger share of my wallet via data mining, I would rather you cleaned up your assortments of all the fakes and absolute junk. Outside of well-known national brands, your assortment is becoming almost un-shoppable. I would recommend spending money to fix those issues first. Then we can worry about how much better your ads and recommendations will get with my 10 receipts a month.

Chuck Ehredt
Member
3 years ago

This program is a land grab, and the quotes in the article could be deceptive for those brands that fall into the same trap as thousands have in the past decade as they abdicated control of their sales channel to the Amazon marketplace.

Brands should be learning what customers buy from complementary retailers so they can better understand the customer´s lifestyle preferences and improve personalization, I applaud Amazon for being so savvy but remain skeptical about whether this insight will benefit other brands using Amazon (or just Amazon).

This insight is best obtained at much lower cost through multi-brand collaborations in loyalty programs – and brands should be actively considering what unique insight they can obtain from loyalty program partners.

Cathy Hotka
Trusted Member
3 years ago

Amazon would have to pay me a LOT more than ten bucks!

TAKU Retail
Member
Reply to  Cathy Hotka
3 years ago

100% agree Cathy but sadly several of my younger staff asked where they could sign up…

Gene Detroyer
Noble Member
Reply to  Cathy Hotka
3 years ago

My problem with these panels (going way back to the ’70s) is that the people who would participate are not a typical shopper. If they’re not, how good can the information be?

Rich Kizer
Member
3 years ago

It’s that age old dilemma: “I never knew” … “You never asked me!”

The information collected can be extremely precious and can be shared with their sources. It can even give information leading to uncovering desired consumer trends and products to come. We are frequently asked by retail clients to conduct and gather this type of information search, and we find it incredible in how consumers spill out their feelings, desires and turn offs. And Cathy is right: Amazon is getting it on the cheap.

Dr. Stephen Needel
Active Member
3 years ago

From a researcher’s perspective, this significantly ups the value of Amazon’s data. It’s one thing to say, here’s what our shoppers do, but another to say, here’s what our shoppers do and what happens when they go elsewhere.

You can make a lot of improvements knowing where and what they’re buying when they’re not buying from you.

Gene Detroyer
Noble Member
3 years ago

This takes me back decades when purchase panels were quite common and every CPG brand was using them. Shoppers got gifts (generally small kitchen appliances). In the early days, they actually recorded their purchases. Later when products had UPC codes they could simply scan them.

I always questioned the value of these panels. It seemed obvious to me that anyone who would take the time to do such recording was not typical. Maybe way beyond not typical. I would ask this question for the Amazon’s endeavor. Even if the invitations are carefully curated, which of the target audience would actually do this?

But Amazon obviously sees great value to the information. While $10 doesn’t seem like a lot, to make the information valuable, they must generate a huge number of data points. I imagine it would cost cumulatively millions of dollars.

Dr. Stephen Needel
Active Member
Reply to  Gene Detroyer
3 years ago

Gene – I used to make my living analyzing household panel data for Burke, IRI, and Nielsen. You’d be amazed at how much effort panelists would put into it and how well their data matched actual store sales. I was always amazed and I was selling analytics on this.

Shep Hyken
Active Member
3 years ago

The more you know about your customers, the better. Knowing what they buy and where they buy from – other than their “store” – is powerful information if it can be assimilated in a form that helps and doesn’t confuse. Most data is based on a customer’s purchase and buying patterns from that store. How often do we look for what’s happening outside of our store? This is powerful information. Focus groups gave us insights to some of this information, but not on the scale that Amazon is talking about. Amazon’s data collection methods and analysis are probably as good as it can get. And no doubt other retailers, such as Walmart, will work to get similar information.

Ryan Mathews
Trusted Member
3 years ago

As the old Motown song warns us, “a taste of honey is worse than none at all.” Amazon’s goal is, and always has been, to put together as complete a picture of the consumer as possible. Before I answer the question, let me take a slightly different approach from my fellow BrainTrusters. I think this make Amazon’s problem worse, not better. Any component data analyst knows you can’t optimize AI or shopping algorithms without complete data. Right now Amazon knows what Amazon knows, i.e., only what we purchase from it. Tossing a few more jigsaw pieces on the table doesn’t necessarily make it any easier to solve the problem. In fact, it make may things exponentially more complex. The only way to get where Amazon wants to go is to have complete purchase level at a household and individual household member level, and that’s worth a lot more than $120 a year. Now, as to the question. Amazon will try to use this data to augment its data streams in critical areas. That much is, I think, unarguable. Will others follow? Yes, but that’s the wrong question. The right questions are: how long will it take for consumers to figure out the actual value of their data and demand that in exchange for the data; and, how long will it take for “consumer data agents” to emerge to streamline the process for consumers on one end and aggregate the results for sellers on the other?

Ricardo Belmar
Active Member
3 years ago

What’s your purchase data worth to you? That’s the question consumers will be asking themselves when they learn of this offer from Amazon for their precious shopper data.

If there’s one area Amazon is blind to about their customers, it’s what they purchase, why they purchase it, and how they purchase it when it isn’t purchased on Amazon.com. The value of this program to Amazon is quite clear – it will allow them to paint a detailed picture of their shopper demographics and buying habits, assuming they achieve a good cross-section of their shoppers. The question is, what kind of shopper will participate and what type of receipts will they submit? Is it more or less valuable to Amazon if a participant submits 10 grocery receipts vs. a mix of grocery and apparel? I suspect the answer is Amazon will take any data they can get as it will make their existing customer data set that much more detailed.

Consumers are becoming more and more numb to the idea of their personal buying data being used by retailers and brands so I suspect this program will be quite successful. You can also look at the Ibotta app in the Apple and Android app stores for an example. Over a million reviews with a very positive rating overall. So it seems $10 may be a good price for your data after all!

Camille P. Schuster, PhD.
Member
3 years ago

Amazon will identify which additional products they want to carry on their website. They will also be interested to know which other retailers their customers use. I am not sure how many people will want to do the work of keeping receipts, taking a photo and uploading them to Amazon’s site for $10 every month. There are some people who purchase elsewhere so they use other sources than Amazon. Some people will not want to share their data. Great idea for Amazon. Not as great for consumers.

Cynthia Holcomb
Member
3 years ago

This is interesting. Given the extensive individual customer intelligence Amazon has acquired over the years via Amazon.com, Alexa, Ring, and the vast network of other Amazon services and devices this new Shopper Panel is curiously benign. Are these receipts the final frontier in the Amazon journey to predict what a customer wants to buy before the customer even knows him/herself? Or are these receipts just another step in the challenge to train machines to replace human customer decision-making? Interesting questions to ponder as we as a society proceed with little questioning, further and further into our individual digital lives managed by vast leagues of autonomous algorithms.

Doug Garnett
Active Member
3 years ago

My first reaction is that Amazon’s morph into Green Stamps takes another step forward. Certainly some people will do this — but I won’t and I don’t know anyone who will.

Does this data have much value? No. We already know how mis-leading shopper data is. Why is it that all the ads I’m fed are for things I already bought or for things I considered briefly and rejected?

Another magician’s headline from Amazon. But there’s really nothing here.

Bindu Gupta
3 years ago

Simple yet brilliant idea to gather self-reported data from customers by incentivizing them. There is so much Amazon can do with such data including providing more competitive pricing on the same product. I can see competitors following suit.

Peter Charness
Trusted Member
3 years ago

You think Amazon could do something useful with the data, like stopping retargeting for products already purchased? That would be useful … just not very likely. In these days of pending anti trust investigations, I’m surprised Amazon is trying this at all now.