Black Friday 2019: Online counterfeits putting consumers at risk

Black Friday and Cyber Monday, now worth a staggering US$14 billion[1], continue to be targeted by unscrupulous counterfeiters looking to exploit increased demand, and platforms are not doing enough to protect consumers and brands.

Bad actors hide their fake products among genuine discounted goods, masking the suspiciously low pricing that consumers might associate with counterfeits. Even to the savviest of buyers, counterfeits become difficult to identify within a sea of constantly changing offers and flash-sales.

With up to 90% of consumers price checking a product on Amazon, even after finding it on a retailers’ page first[2], genuine sellers are immediately put at a disadvantage during sale events.

Counterfeits increasingly offered to consumers in the run-up to Black Friday and Cyber Monday

Increasingly, we see counterfeiters enrolling in pre-sale campaigns. Using Corsearch's online brand protection technology, our analysts detected a spike in infringement activity for a premium footwear brand on Amazon in the run-up to Black Friday 2018. 24,257 high-risk listings were identified in November 2018 compared to 8,096 high-risk listings in October, representing an increase of almost 300%. A high-risk listing is one that has been identified to likely be a counterfeit.

Black Friday 2019 infringement:

• eBay – 15,989 high-risk listings were identified for a premium fashion brand in November, compared to 8,588 in October – representing an increase of 86%.
• Amazon – 562 high-risk listings were detected for a leading cosmetics brand in November, compared to 212 in October – revealing an increase of 165%.

The increase in infringement is echoed on social media. For one luxury brand, our analysts discovered a 233% increase in Instagram posts using the hashtag ‘#blackfriday’ to promote counterfeit watches during the four-week run-up.

Dangerous fake toys sold to consumers through Amazon

In 2014, fake versions of the ‘Mustachifier’ branded baby pacifier were sold through Amazon. The product broke in two when used and led to a child in the US almost choking on the loose parts.

A separate incident in 2018 led to a child having parts of their colon removed after swallowing 13 tiny magnets from a Chinese copycat of a ‘Magformers’ toy[3]. These fakes were widely available on Amazon and, even after being removed, it is unclear whether they were ever recalled.

Sellers aren’t required to provide any certification when listing children’s products on Amazon. The company only states that “Sellers are responsible for tracking and complying with any regulations issued by the CPSC [Consumer Product Safety Commission]”.

Counterfeiters exploit the Amazon ‘ASIN’

The ASIN (Amazon Standard Identification Number) is the unique offer identifier on Amazon, with each home to an individual product. Amazon requires brands to share ASINs with other sellers of the same product, but these sellers are not required to prove that their versions are legitimate.

Amazon algorithms favor top-selling and ‘best-value’ products. This helps counterfeit ASINs appear front and center.

The Amazon buy box – a game of tug of war for brands

82% of sales on Amazon are through the buy box[4]. The buy box contains the ‘buy now’ button and appears at the top of the Amazon listing. It is owned by only a single seller at any one time but will often change hands throughout the day.

Obtaining the buy box is an art-form which has been perfected by counterfeiters. With price a major determinant, Amazon algorithms favor counterfeiters over legitimate sellers who comply with minimum advertised prices (MAP) set by brands.

The ruthless and fast-paced nature of the buy box offers the perfect battle ground for counterfeiters during Black Friday and Cyber Monday. Counterfeiters discount their products to hijack the buy box for a short period, appearing legitimate to consumers during a sale event

Platforms slow to protect consumers during the holiday season

Marketplaces are clearly vulnerable during the holiday season and are slow to react to increased levels of infringement, with some taking longer to remove counterfeit listings.

“ eBay aims to remove counterfeit listings within 24 hours. However, this November we have noted that on some occasions the platform is taking up to 5 days to remove high-risk listings.”
– Katerina Pribanova, Corsearch Brand Protection Sub-Team Leader

A delay in removal can reduce its overall impact. If a counterfeit is only taken down after sale events have ended, the damage may have already been done.

Alarmingly, Corsearch analysts have discovered that online enforcement forms on ‘Shopee’ (a marketplace notorious for counterfeits) have been disabled since November 26, possibly as a cynical attempt to reduce takedowns before this week’s sale events.

What can brands do?

It is essential that brands monitor infringement trends in the run-up to Black Friday and Cyber Monday. And as the phenomena continue to expand to new markets, they must look further afield too.

For each high-priority platform, you should have a comprehensive strategy in place. Our proposed strategy for Amazon during the holiday season is as follows:

1. Monitor the buy box on your listings closely
2. Proactively defend your brand on Amazon by signing up to Brand Registry and ‘gate’ high-priority ASINs (the ASIN is the unique offer identifier on Amazon)
3. Monitor non-gated authorized ASINs and look for duplicates

Amazon’s Brand Registry offers a number of tools to help brands manage their presence on the marketplace and to remove infringing products, including:

1. Bulk enforcement of counterfeit ASINs
2. Merging duplicate ASINs

As always, there are caveats. Brands require a trademark to register for the Brand Registry; those with design rights or other forms of IP are currently locked out of the program. Amazon also does not effectively police the Brand Registry across different regions.

Ultimately, you will require sophisticated Brand Protection technology that can work in tandem with a platform’s own anti-counterfeiting tools.

A Brand Protection solution

Using brand protection technology, you will be able to measure the impact of enforcement and prioritize activity by region and risk.

At Corsearch, we work with our clients to ensure they protect their consumers and brand reputation online. We allow our customers to meaningfully reduce online infringement and increase their online sales by targeting the largest infringers. If you believe your brand is under threat and are interested to see how our technology can offer a long-term solution to online infringement, request a free demo from one of our experts below.

References:

[1] https://www.forbes.com/sites/nikkibaird/2018/11/28/every-result-you-need-to-know-about-black-friday-cyber-monday-and-holiday-2018-so-far/#268bcd6f4eb5

[2] https://www.cnbc.com/2016/09/27/amazon-is-the-first-place-most-online-shoppers-visit.html

[3] Beware: Dangerous Counterfeit Toys for Your Baby Are Being Sold on Amazon (Inc, 2019): https://www.inc.com/jeff-bercovici/amazon-dangerous-kids-products.html

[4] https://www.bigcommerce.co.uk/blog/win-amazon-buy-box/#what-is-the-amazon-buy-box