Nowadays when “a trip to the shops” could just as easily be completed, by just a few taps of our fingertips, e-commerce websites such as Amazon, have become the new digital shopping mega-mall. Especially so for most safety-conscious consumers amid the Coronavirus pandemic. According to Washington Post’s article Amazon sales soar as coronavirus-worried consumers shop from home, but costs rise, there has been a massive surge in sales between the first quarter of 2019 and 2020. 2019’s $59.7 billion sales (a record) in the first quarter was completely dethroned by 2020’s remarkable $75.5 billion sales for the same quarter. While Amazon is known for its low-friction shopping experience for some major brands the lack of friction is more a slippery slope they would rather not be on. The amount of friction faced by counterfeit sellers is also low.
Every day, luxury and even general household brands are facing a growing problem with counterfeit and Amazon is concerned. Mainstream press articles have recently shone a light on the issue and some brands are even initiating legal action to hold the marketplace responsible.
One example is the French luxury jewellery brand Cartier. They are famous worldwide for selling a variety of jewellery designs and accessories, but one of the most popular is the minimalist Cartier love bracelet. Thin, sleek, timeless, and classy. While the demand for this bracelet seems insatiable, pent up consumer aspiration seems to have spawned countless fake versions. Listings that do not exactly bear the brand name but cannot be mistaken as an unauthorised replica.
Third-party is not always a fun party.
So what’s behind the problem and how exactly do counterfeit products land on Amazon?
Machete Systems Pty. Ltd (Arguably Australia’s foremost Amazon Seller Central Experts) advise that brands cannot afford to ignore the problem. “It’s not a matter of if you will be counterfeited online, it’s just a matter of when.” says Tim Shelton a senior partner at Machete Systems. “The biggest mistake we see is brands either ignoring or not engaging actively with Amazon and leaving the fate of their brands to third party sellers.” continues Shelton.
Amazon itself defines third-party transactions on it’s website About Ordering from a Third-Party Seller Third-party sellers are independent sellers who offer a variety of new, used, refurbished, and collectible merchandise.
Brand often do not understand that Amazon does not have full control of items outside their storage and shipping service or the so-called, Fulfilled-by-Amazon (FBA). Instead, third party sellers often self-manage their Amazon store and supplies. High volume and high-value products are the most targeted products for counterfeiting.
What’s Amazon doing about it?
Tools like “Project Zero” and “Transparency” show that Amazon is doing quite a bit to try and defeat counterfeit and supply chain authenticity but often the brands themselves fail to exploit or understand how these tools work.
Tip of the iceberg.
The Cartier brand made headlines in the e-commerce industry after authorities took hold of $2.6 million worth of a replica from Hongkong. It was a small win for both the brand and its potential consumers, igniting awareness of the problem. No doubt, the e-commerce industry has accentuated the convenience in shopping but has also given rise to the darker side of retailing.
In an age where shopping can be done from bed, it is beholden on brands to engage with key industry players like Amazon to ensure their customers only buy authentic branded products. Active and informed engagement with marketplaces is the only way brand owners can look forward to a good night sleep it seems.
Tim is a Senior partner at machete.systems