The fight against fakes and infringements on the web marketplace is marking new ground.
Only months after Alibaba took the step of suing two sellers of fake Swarovski watches on its TaoBao platform, Amazon has announced the roll-out of a brand registry as a free service for companies to list their logos and intellectual property.
In fact, this is something Amazon has been testing since last year, under the auspices of the Brand Central project, and reflects Amazon’s efforts to court the growing business of third-party sellers. According to Peter Faricy, vice president of Amazon Marketplace, third-party sales now account for around 50 per cent of units sold on Amazon. Faricy explained to Reuters “access to Amazon’s more than 300 million customers allowed 100,000 sellers to generate at least $100,000 each through the company last year”. At stake are not only Amazon’s commissions, but fulfilment services and advertising sales to third-party vendors.
The new registry will allow Amazon to remove listings and cancel seller accounts if counterfeit products are spotted. Moreover Amazon is offering brands a program called “Transparency,” which lets them label packages with a code that shoppers can use to cross-check their purchase against official information.
No doubt a $50 million lawsuit filed last December against Amazon (and WalMart) by Darryl McDaniels, owner of Run-DMC Brand LLC, for selling Run DMC branded clothing and accessories without permission played a significant role in forcing Amazon’s hand.
Alibaba also is taking steps to deal with the fake goods plague, with 2,000 permanent staff plus 5,000 volunteers working full-time with AI-driven data-mining tools to spot fake items. Its algorithms monitor hundreds of data points like seller price and transaction records, and use images and logo scanning to find mismatches between text and picture.
Amazon’s Faricy said efforts against counterfeit products are at an early stage.”I don’t think it’s the kind of thing where you ever feel like there’s a clear ending,” he told Reuters. “It’s a journey.”