This week Amazon announced a major initiative to help fight back against rogue sellers listing counterfeit products on its marketplace. This announcement follows hot on the heels of 3M suing a major rogue seller price gouging N95 masks during the initial COVID-19 crisis.
With Amazon continuing to strike the balance of just over 50% of its unit volume coming from third parties listing on its marketplace (rather than directly sold by Amazon itself) – the need for the company to pump investment into technology, reporting tools, and teams of people to ensure a customer-first experience will likely only grow.
This is not the first of such investments in technology with Amazon stating in April 2020 that it was intending to increase its commitment to verifying third-party sellers by video.
“Online marketplaces and organized retail crime are a match made in heaven. Consumers, retailers, and brands are all impacted. Marketplaces, including eBay, have long worked closely with law enforcement to report and prosecute fraud. Amazon’s marketplace is the most far-reaching so we welcome their increased efforts to fight this serious issue,” says Fred Dimyan, CEO, POTOO Solutions.
With over 550 brands under active protection, POTOO has extensive experience supporting the wide spectrum of policing listings on Amazon and we hope this will result in a more meaningful two-way relationship with brands that up until now, have had to rely on tickets submitted through Vendor Central or Brand Registry. Learn how POTOO helps brands manage this here.
Here are our takeaways & recommendations to our community:
1.) While counterfeits are clearly catastrophic for brand equity and consumer-experience – 85% of our brand partners are focused on ensuring regulatory compliance, shipping/packing standards, selective distribution policies, and price stability are adhered to. Counterfeit takedowns may be big news when it happens, but the bulk of the erosion of trust comes from the smaller paper cuts.
2.) Amazon’s Counterfeit Crimes unit is a sledgehammer to those rogue sellers blatantly counterfeiting or using copyrights. Brands should remember that there is still a huge value opportunity to identify and clean up distribution leaks for those sellers who may have legitimate products sourced legally, which does not require legal action.
3.) For when there is the need to have your in-house counsel work with Amazon for investigations of counterfeit products, ensure you have a certified chain of custody process for any evidence gathered – from seller identification to test buys. Document everything.
4.) Ongoing data monitoring is key to keeping on top of any marketplace, whether that is Amazon, eBay, Allegro, Lazada, or Mercado Libre.
5.) Any marketplace monitoring solution should not just focus on your current product catalog, but should also be a broad match on your brand and trademarks for any listings popping up that may be duplicated listings or unique SKUs (such as bundle packs or gifts with purchase).
To receive a free diagnostic on your brand’s 3P Marketplace – including rogue sellers, counterfeits, or cross border sourced products – give us a shout here: https://potoosolutions.com/#p-connect