Amazon is planning to expand its operations to Tier 1 and Tier 2 cities. They have observed that users don't trust the brand. What should they do to build trust with the user base?

Question

Amazon is planning to expand its operations to Tier 1 and Tier 2 cities. They have observed that users don't trust the brand. What should they do to build trust with the user base?

Asked at Amazon over a year ago

1.8k views

& 1 other company

Asked at

& 1 other company

1.8k views

How to answer Product Strategy questions

Interview Guide

Clarification Q #1 - City tiers

By Tier-1 & 2 cities, I understand large metros with population in the millions
The Q says "expand operations *to* tier 1 and 2 cities", which implies that it is not present in those cities but is present in Tier 3 and lower cities. This is contradictory to my experience. Thus I'd clarify the Q as:
- "Expand *IN* Tier 1 and Tier 2 cities". OR
- "Expand *BEYOND* Tier 1 and 2 cities"
I'll base my answer assuming it's "expand *IN* tier 1 and 2 cities"

Clarification Q#2 - Users

By 'users' I assume it is meant shoppers and not those involved with the selling of goods - merchants / delivery network etc

Clarification Q#3 - Trust deficit

Is the trust deficit issue with Amazon brand specifically or with online shopping in general ?
Although the Question say's Amazon brand, for Tier 1 & 2 customers who have a lot of offline options as well, we need to benchmark against not just online competitors but offline competitors as well.
Is the trust deficit specific to a category of products ? Electronics v/s Fresh food etc
- Since the number of categories offered on Amazon are so large, it would be prudent to look at each of the top categories individually .

------------ ---------

How Tier 1 & 2 cities are different than tier 3,4 cities:

Greater population density, translating to more sales per square kilometre.
Greater choice of offline shopping options available
Greater focus on the higher end of the product category
Greater focus on convenience of shopping and time saving

The term 'trust deficit' is not very precise, and for it to be actionable we need to better understand what it means in terms of user behavior. Only then we can more directly target solutions around that area.

Potential Areas of Trust deficit

User cannot find what they want to buy
Users do not like the pricing
User dissatisfied with the quality of products bought
Latest Payment options not present - Wallets / bitcoin other niche FOP
User unhappy or not confident of the delivery experience
Bad experience with refunds / exchanges
Privacy / Security concerns.

Possible Actions to improve trust

Source of trust-deficit & Possible actions

User cannot find what they want to buy

Ensure we have the top N goods sold by volume for each category / sub-category
The top N items Tier 1&2 cities may be different than in smaller cities.
- Use AI to identify what people are searching for but not buying
- Increased focus on new launches

Users do not like the pricing

Price match guaranties
Price drop guaranties
Payment plans / financing

User dissatisfied with the quality of products bought

Are the pictures / details / descriptions detailed enough to make a shopping decision?
Compare with other online stores - Automation
Check if too many clarifying Qs are being asked
- Are the descriptions accurate ?
  - Analyse review comments - use AI
  - Users to Flag inaccurate descriptions or poor quality products bought.
- Cull items / vendors that have high refund % or a large number of customers flagging it.
- Provide easy resolution on conflicts
- Track and incentivize more products to offer easy and free refunds

Payment options not present.

Provide all forms of payment (FOP). Include the latest FOP like bitcoin / Wallet etc
Ensure discounts etc offered by the cards/banks are available.
Ability to forget / delete the FOP after a single transaction.

Delivery experience is not good

Delivery times too long
Cost of shipping to high
Delivery options not convenient - as nobody home at time of delivery.

Reduce shipping time and cost

Greater % of goods sold from a warehouse closer to the city
Analytics on past order can give insights on what additional items to stock in the city-specific warehouse.
- Provide multiple self pick-up centres
- Option to provide multiple drop-off addresses based on time-of-day.
  - For instance if delivery is between 9am-5pm drop of at 'Work', else drop off at 'Home'
- User selected drop-off time.

Ease of use

How long does it take to complete a purchase in terms of number of clicks

Can we simplify or shorten the number of clicks.
Better suggestions of products / easier to find buttons / fewer clicks

Privacy / Security

Are there privacy / security concerns ?

Delete transaction history.
Shop anonymously without logging in
Delete account at any time
Configure what messages to receive or not receive

Prioritization and conclusion

To improve operations specifically at Tier 1 and Tier 2 cities I would focus on improving the delivery and refund experience as all most other options recommended are independent of city size and I assume are being addressed by other initiatives.
Specifically I will focus on creating multiple mini-warehouses and partnering with local stores for pick-up. The shorter distances within the city will allow cutting down of delivery time and also make refunds easy.