sustainability at amazon - mit sloan · (such as natural, organic, or local...
TRANSCRIPT
Sustainabilityat
Amazon
15.913/915SustainabilityLabShelbyWhite|PrestonKutneyPra:kModi|GeorgCaspary
PartI:Whataree-Commerce/consumer
purchasingbehaviorsofyoungIndian
consumers?Whatisthesizeandpoten:al
ofthismarket?
ProjectObjec1ve:ThegoaloftheprojectwastohelpAmazonuncoverinsightsaboutmillennialandgen-zIndianconsumers’
aPtudestowardssustainabilityandtheeffectonpurchasepreferencesinordertoprovideAmazonwith
informa:onthatwillhelpestablishinnova:veproductsorprogramsgearedtowarditssustainability-minded
consumersintherapidlygrowingIndianmarket.ToassistAmazon,wesoughttoanswerthefollowing
researchques:ons:
PartII:HowdoIndiansunderstandanddefine
sustainability?WhatareyoungIndian
consumeraPtudesaboutenvironmental
sustainabilityissues?
PartIII:WhatareyoungIndians’aspira:onsfor
thefutureandhowwillculturalvaluesand
aPtudesonsustainabilityaffecte-Commerce
behavior,especiallyaswealthgrows?
MethodologyandFindings:Focusingprimarilyonsecondaryresearch,ourteamexploredexis:ngstudiesonthetopicofsustainability,
millennialsandgenera:onzpreferencesintheU.S.versusIndia,aswellasevidenceonaPtudesofexperts
onclimatechange.AYernarrowingthescopetoincludeenvironmentalconcernsamongMillennial
consumersinIndiaonly,wefoundthefollowinginsights:
o Marketislargeandpoisedforgrowth,
ledbyyoungconsumers
o Popula:onis65%rural,but70%ofincomeisgeneratedinci:es
o Vegetarianismandweddingspending
highlightuniqueculture-driven
spendingbehavior,withsignificant
differencesfromU.S.,especially
regardingfood
o Significantchallengestoe-Commerce
penetra:onexistincluding:poor
infrastructureandcashondemand
beingprimaryformofpayment
o Climatechangeisperceivedasthebiggest
globalissuebyIndianswhileNorthAmerica
andWesternEuropeconsiderISISasthe
biggestglobalthreat
o “Green”isassociatedwith“natural”or“herbal”andthemarketfororganicand
naturalproductshasbeengrowingat
25-30%
o YoungIndiansaremoresociallyresponsible
andenvironmentallyawarethanprior
genera:ons
o Indianconsumersmorelikelytopurchase
eco-friendlyor“green”products,allother
thingsbeingequal
o Inconclusivewhetherornotyoungconsumersarewillingtopayapremium
o Limitedevidenceforrela:onshipbetween
na:onalincomeandenvironmentalism.
o Consump:onbehaviorinmostcategorieswill
changewithincome,withafewnotable
excep:ons-preferencesaroundmeat
consump:onandlocalgoodswillremain
sustainable.
o IndiahasalonghistoryofCSRandIndiansbelievecompanies(especiallyforeignones)
haveadutytowardssocietythatislegally
enforceableandincreasinglyfocusedonthe
environment.
NextStepsforAmazon
InlightofthequalityofavailableresearchonIndianconsumers’aPtudesaboutsustainability,the
reliabilityandvalidityoftheconclusionsmaynotbeanadequatefounda:onforimmediateac:on.
WebelievefurtheranalysisisrequiredandAmazonisinauniqueposi:ontotakeadvantageofits
expansiveconsumerpurchasingdata:
MatchedpairsbacktestonpastsalesFindapairofsimilarproducts,withiden:cal
pricesandcustomerreviews.Oneproductin
thepairmustbeclearlysuperiorinsome
dimensionofsustainability.Analyze
propor:onsofsalesofthatproducttothe
overallcategoryinneighborhoodswith
differentincomeoragelevels.Repeat
analysisamongbothIndianandU.S.
consumerstocompareandcontrastfindings.
Experimentop1on2Forasingleitem,A/Btestversionsofthe
salespagewithsustainabilitymessagingor
informa:onplacedmoreprominently
(suchasnatural,organic,orlocal
adver:sementsIndian-made)andevaluate
twoeffects:theinforma:oneffectonsales
ofequallypriceditems,andthen
separately,thepriceeffect,orelas:cityof
demandaspriceisincreasedforthe
“sustainable”version.
Experimentop1on1StudyeffectofAmazon-brandedpackagingwaste
vsnon-brandedpackagingwasteonwillingnessto
purchaseonAmazon.Studydesigncouldhave
respondentsenterpastatrash-filledstreet,with
brandedtrashinten:onallyplacedintheirpath.
Respondentswouldbetoldthestudyisabout
eCommerceandremunera:onwouldmoney
towardsaneCommercewebsiteoftheirchoice.
Objec:ve:Determinewhetherornotthereare
nega:veeffectstobrandedwasteconsidering
Indianconsumers’concernsaboutinadequate
wastemanagement.