Amazon “seized and destroyed” over 2 million counterfeit merchandise that sellers despatched to Amazon warehouses in 2020 and “blocked greater than 10 billion suspected unhealthy listings earlier than they have been revealed in our retailer,” the corporate mentioned in its first “Brand Protection Report.”
In 2020, “we seized and destroyed greater than 2 million merchandise despatched to our achievement facilities and that we detected as counterfeit earlier than being despatched to a buyer,” Amazon’s report mentioned. “In instances the place counterfeit merchandise are in our achievement facilities, we separate the stock and destroy these merchandise so they don’t seem to be resold elsewhere within the provide chain,” the report additionally mentioned.
Third-party sellers also can ship merchandise on to shoppers as a substitute of utilizing Amazon’s delivery system. The two million fakes present in Amazon achievement facilities would solely account for counterfeit merchandise from sellers utilizing the “Fulfilled by Amazon” service.
The counterfeit downside received worse over the previous 12 months. “All through the pandemic, we have seen elevated makes an attempt by unhealthy actors to commit fraud and supply counterfeit merchandise,” Amazon VP Dharmesh Mehta wrote in a blog post yesterday.
Counterfeiting is a longstanding problem on Amazon. Different issues on Amazon that harm consumers embody the sale of dangerous merchandise, fake reviews, faulty third-party items, and the passing of bribes from unscrupulous sellers to unscrupulous Amazon staff and contractors. One US appeals court docket dominated in 2019 that Amazon might be held responsible for faulty third-party items, however Amazon has won different related instances. Amazon is once more arguing that it shouldn’t be held answerable for a faulty third-party product in a case earlier than the Texas Supreme Court docket that entails a severely injured toddler.
Amazon tries to reassure legit sellers
Amazon’s new report was meant to reassure official sellers that their merchandise will not be counterfeited. Whereas counterfeits stay an issue for unsuspecting Amazon prospects, the e-commerce big mentioned that “fewer than 0.01 p.c of all merchandise bought on Amazon acquired a counterfeit criticism from prospects” in 2020. In fact, folks might purchase and use counterfeit merchandise with out ever realizing they’re pretend or with out reporting it to Amazon, in order that proportion might not seize the extent of the issue.
Amazon’s report on counterfeits describes intensive programs and processes to find out which sellers can do enterprise on Amazon. Whereas Amazon has argued in court docket that it isn’t answerable for what third events promote on its platform, the corporate is monitoring sellers in an effort to keep up credibility with consumers and bonafide sellers.
Amazon mentioned it “invested over $700 million and employed greater than 10,000 folks to guard our retailer from fraud and abuse” in 2020, including:
We leverage a mixture of superior machine studying capabilities and skilled human investigators to guard our retailer proactively from unhealthy actors and unhealthy merchandise. We’re continually innovating to remain forward of unhealthy actors and their makes an attempt to avoid our controls. In 2020, we prevented over 6 million makes an attempt to create new promoting accounts, stopping unhealthy actors earlier than they revealed a single product on the market, and blocked greater than 10 billion suspected unhealthy listings earlier than they have been revealed in our retailer.
“That is an escalating battle with criminals that try and promote counterfeits, and the one approach to completely cease counterfeiters is to carry them accountable by litigation within the court docket system and thru legal prosecution,” Amazon additionally mentioned. “In 2020, we established a brand new Counterfeit Crimes Unit to construct and refer instances to legislation enforcement, undertake impartial investigations or joint investigations with manufacturers, and pursue civil litigation in opposition to counterfeiters.”
Amazon mentioned it now “report[s] all confirmed counterfeiters to legislation enforcement companies in Canada, China, the European Union, UK, and US.” Amazon additionally urged governments to “improve prosecution of counterfeiters, improve assets for legislation enforcement preventing counterfeiters, and incarcerate these criminals globally.”
Stricter seller-verification system
Amazon mentioned it had a “new dwell video and bodily deal with verification” system in place in 2020 wherein “Amazon connects one-on-one with potential sellers by a video chat or in particular person at an Amazon workplace to confirm sellers’ identities and government-issued documentation.” Amazon mentioned it additionally “verifies new and current sellers’ addresses by sending data together with a singular code to the vendor’s deal with.”
Most new makes an attempt to register as a vendor have been apparently fraudulent, as Amazon mentioned that “solely 6 p.c of tried new vendor account registrations handed our strong verification processes and listed merchandise.” General, Amazon “stopped over 6 million makes an attempt to create a promoting account earlier than they have been in a position to publish a single itemizing on the market” in 2020, greater than double “the two.5 million makes an attempt we stopped in 2019,” Amazon mentioned.
The verification course of is not sufficient by itself to cease all new fraudulent sellers, so Amazon mentioned it performs “steady monitoring” of sellers to determine new dangers. “If we determine a nasty actor, we instantly shut their account, withhold funds disbursement, and decide if this new data brings different associated accounts into suspicion. We additionally decide if the case warrants civil or legal prosecution and report the unhealthy actor to legislation enforcement,” Amazon mentioned.
Amazon screens product element modifications for fraud
One downside we wrote about a few months ago entails “bait-and-switch critiques” wherein sellers trick Amazon into displaying critiques for unrelated merchandise to get to the highest of Amazon’s search outcomes. In a single case, a $23 drone with 6,400 critiques achieved a five-star common score solely as a result of it had 1000’s of critiques for honey. Sooner or later, the product itemizing had modified from a meals merchandise to a tech product, however the critiques for the meals product remained. After a purging of the outdated critiques, that same product page now lists simply 348 rankings at a 3.6-star common.
Amazon is attempting to stop recurrences of this downside, saying in its new report that it scans “greater than 5 billion tried modifications to product element pages day by day for indicators of potential abuse.”
Amazon additionally offers self-service tools to corporations to assist them block counterfeits of their merchandise. Amazon’s report mentioned that 18,000 manufacturers have enrolled in “Venture Zero,” which “offers manufacturers with unprecedented energy by giving them the flexibility to immediately take away listings from our retailer.” This system additionally has an non-compulsory product serialization function that lets sellers put distinctive codes on their merchandise or packaging.
The self-service device solely accounts for a tiny proportion of blocked listings. “For each 1 itemizing eliminated by a model by our self-service counterfeit removing device, our automated protections eliminated greater than 600 listings by scaled expertise and machine studying that proactively addresses potential counterfeits and stops these listings from showing in our retailer,” Amazon mentioned.