Amazon Slammed For Counterfeit Sales
Counterfeit merchants becoming a large part of Amazon’s platform
July 19, 2016 - Los Angeles, CA – Counterfeit problems are growing for Amazon as outside China sellers overwhelm the web platform.
“In Amazon's quest to be the low-cost provider of everything on the planet, the website has morphed into the world's largest flea market — a chaotic, somewhat lawless, bazaar with unlimited inventory” says a recent CNBC Report.
In May, CNBC.com reported on a Facebook group, now consisting of over 600 people, whose members have seen their designs for t-shirts, coffee mugs and iPhone cases show up on Amazon at a fraction of the price of the originals. The designers described it as a game of whack-a-mole, where fakes pop up more quickly than they're taken down, the report added.
e-Commerce giants, Amazon® (AMZN), eBay® (EBAY) and Alibaba® (BABA) are no strangers to allegations of selling counterfeit goods. The e-commerce giants face a “credibility crisis” fueled by a failure to crack down on counterfeit goods and making it easy for the world’s largest criminal enterprise to peddle $1.7 trillion in counterfeit goods to unsuspecting consumers. Social media sites Facebook®, Twitter® and Instagram® have also become popular counterfeit outlets. Even Walmart has opened its website to third-party vendors and was caught selling counterfeits.
Many consumers do not recognize that Amazon listings present three distinct global product outlet channels;
To unsuspecting consumers, fake products can appear legitimate because of the Fulfillment by Amazon program, which lets manufacturers send their goods to Amazon's fulfillment centers for a commission, but gain the stamp of approval that comes with the Fulfilled by Amazon designation.
Amazon reports over 2-million Marketplace accounts (2014). Marketplace products are never touched by Amazon, but are shipped by sellers all over the world. The Counterfeit Report®, a popular consumer protection and education website, conducted dozens of name-brand test purchases from Amazon Fulfillment and Amazon Marketplace sellers, but never received an authentic item.
Amazon allows multiple sellers to list against “permanent catalog page” images making identification of counterfeit products difficult. The Amazon “A-to-Z Guarantee” covered the counterfeit purchases with an overall prompt and consumer confidence building response. A counterfeit item was even received from an Amazon Direct purchase, so caution is still advised.
Amazon has an anti-counterfeiting policy in place and responds to infringement notices, investigating and kicking off sellers who break the rules. But the dishonest sellers move fast, changing the names of their stores and relaunching as quickly as they're removed.
For a brand built on trust, there are an awful lot of loopholes for dishonest and fraudulent sellers. Web platforms that facilitate criminal activity and benefit from the proceeds of dishonest actions which impact jobs, consumer safety and public trust create a public perception of deception and impunity. However, reputation damage is only a small part of the problem: counterfeiting costs US manufacturers over $250 billion, and US workers over 750,000 jobs.
Counterfeiting is a $1.7 trillion global criminal enterprise; the criminals avoid taxes, and the illegal counterfeiting activity is profitable, difficult to track and widely unpunished. While consumer awareness is only part of the global solution, counterfeited products are now very deceptive, and consumers often unknowingly purchase hazardous or deadly counterfeit products. It's the manufacturers and consumers who ultimately get hurt.
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