When American shoppers go to street bazaars, flea markets and swap shops, they have a certain expectation that they may run into counterfeit products. In fact, some of these shoppers specifically search for fakes and cheap knock-offs because they have certain expectations in mind. In Los Angeles, for example, the Santee Alley attracts tourists in search of the infamously fake Gucci and Louis Vuitton purses; these shoppers know that what they are getting are counterfeits that look like the authentic handbags that will probably rip at the seams in a few months, and they accept this assumption because of the low prices they pay.
Amazon Market Place and Third-Party Sellers
The Amazon third-party marketplace is a lot like the Santee Alley in terms of its abundance of counterfeiters. However, you could at least give credit to the Los Angeles street merchants for being upfront about the merchandise they sell. The problem with the Amazon Marketplace is that rogue sellers are known to utilize several dirty tricks to ply their wicked trade. In other words, shoppers are at great risk of unknowingly purchasing counterfeit products and paying full price.
Let’s say you gain exclusive distribution rights to a Middle Eastern brand of luxury linens; these are products that would easily sell in stores such as Macy’s and Nordstrom, and thus you would trust those two department stores to not allow counterfeits next to your luxury bed sheets made of Turkish cotton. Your potential buyers do not shop for fakes in Nordstrom of Macy’s.
How the Amazon Gray Market Works
An unfortunate fact of the Amazon Marketplace that founder and CEO Jeff Bezos has had to live with over the last few years is that nearly 40% of all items on that retail platform are either counterfeit products or other kinds of unethical listings.
The problem with Amazon and its unfortunate rash of counterfeiters is that the open nature third-party marketplace can be exploited by unethical sellers who can trick buyers into believing that they are getting legitimate items. To understand the gray market, it helps to recognize the three levels of fulfillment in the marketplace:
1. Products sold by Amazon are verified and vetted by the company, which means that they are not fakes.
2. Products that ship from Fulfillment by Amazon (FBA) centers around the world are not necessarily verified.
3. Products that are sold and shipped by third parties are never verified.
As you can imagine, the gray market thrives within the FBA and third-party levels of order fulfillment because Amazon does not verify products.
What You Can Do to Prevent Counterfeit Activity?
As a seller introducing new products and registering new Amazon Standard Identification Numbers (ASINs), the burden is on you to look out for counterfeiters. The first step is to spot suspicious activity; if you only have one or two products, you can do this from your Seller Central dashboard and by paying close attention to comments left by seller in your product listing pages. Once you register 10 or more ASINs, you will need a subscription service such as Brandlox to monitor your retail activity.
What to Expect with Brandlox
With Brandlox, you can expect a real-time notification of ASIN hijacking or counterfeit sales; this is only the first step of the process. Amazon has implemented a zero-tolerance policy against counterfeiters, but it requires tangible evidence before taking action, and this is when the Brandlox test purchase feature comes into play.
To generate a test purchase within Brandlox, you simply follow the prompts and allow the system to collect all the evidence and notify Amazon for the purpose of flushing out all sellers listing counterfeit products; in some cases, multiple accounts link back to a single seller. Amazon will not proceed without a properly documented test purchase. To learn more about this feature and protect your bottom line on the marketplace, contact Brandlox today.