Amazon is Selling Counterfeit Products
If you live in the world of e-commerce, watch Good Morning America, or follow any reputable publication, you’ve likely heard about Amazon’s latest “scandal,” – the number of counterfeit products on Amazon.
The Wall Street Journal recently reported an internal investigation found “4,152 items for sale on Amazon.com Inc.’s site that have been declared unsafe by federal agencies.” More alarming is the additional 2,000 listings for toys and medications lacking warnings about health risks to children.
Of course, we all want to know what Amazon is doing to prevent the sale of counterfeit products, but the broader issue is that this is NOT the first time large amounts of counterfeit merchandise have turned up on Amazon’s platform.
Good Morning America Is Wrong
On Good Morning America, reporters informed consumers the only way to guarantee the legitimacy of a product is if it’s Sold and Shipped by Amazon. This is astoundingly false. Amazon has a track record of mistakenly purchasing counterfeit wholesale products.
Perhaps the most notorious incident was just last year when Jon Fawcett, CEO and Founder of Fuse Chicken, was contacted by a New York Times reviewer. According to Forbes, the NYT reviewer emailed Fawcett a few days after receiving the product, wondering if what the had received was correct. After reviewing what was supposed to be a premier product, Fawcett couldn’t make up what it was.
To skip to the punchline, the reviewer received a rogue Chinese counterfeit that was Sold and Shipped by Amazon – shipped directly from the e-commerce giant’s warehouse.
How to Ensure Amazon Products are Legitimate
Ninety-nine percent of the time when you purchase a product from Amazon it will be legitimate. However, as the retail giant is selling over 12 million products, that one percent adds up and there are cases, as we’ve seen, that Amazon themselves has mistakenly bought counterfeit products.
The only way to guarantee the legitimacy of a product is if it’s purchased through the manufacturer. Consumers need information and resources to make informed decisions about their purchases. The average consumer doesn’t know what a buy-box is, and they aren’t looking at who the product is sold and shipped by. They’re looking at who has the “Prime” logo and associating that with Amazon specifically – which we know isn’t always the case.
A great example of this is all the Kylie Jenner Lip Kits available on the marketplace. Kylie Cosmetics will never sell on Amazon, but if you search for Kylie Jenner Lip Kits, the consumer has more than 50 sellers to choose from, multiple fraudulent storefronts and the large majority of them are Amazon Prime.
To purchase directly from the manufacturer, there are a few key indicators to look for… starting with the buy box. The buy box refers to the white box on the right side of a product’s listing page, where customers can add items to their cart.
Above the “Add to Cart” option, there will be Sold by ‘Brand’ and Fulfilled by Amazon. If a product says “Sold by Amazon and Fulfilled by Amazon,” the product was bought wholesale by Amazon – where the counterfeit products came from.
When you decide to purchase directly from the manufacturer, be sure to look at their storefront by clicking on the byline. Some questions to ask yourself are: Does this storefront look legitimate? Is the storefront related to the brand? Are there other products listed that appear off-brand? If something appears to be off, it’s best to steer clear of that product.
Additionally, consumers can visit the Seller Feedback storefront to see what previous purchasers are saying about products they received from that Seller. Even one review about a product being counterfeit should raise red flags.
Counterfeit Baby Products Being Sold by Amazon
Perhaps the most alarming counterfeit products being sold by Amazon are baby products. The Journal tested 10 children’s products it bought on Amazon, many labeled with the “Amazon’s Choice” badge. Four of these products failed tests based on federal safety standards, including one with lead levels exceeding federal limits.
On a more personal level, one of Envision Horizons clients operating in the baby segment had the same experience.
The story goes, one of our account managers spotted negative product reviews and upon some investigation, found a rogue third-party seller. Amazon purchased counterfeit wholesale products and was selling them to be used on babies. We quickly shut down their Vendor account before the damage was irrevocable, but not everyone has the bandwidth of having eyes on their account 10+ hours a day.
More Brands are Switching to Seller Central
The majority of Amazon’s sales are coming from Seller Central. This is largely due to the number of brands adopting the Seller Central model. They are either completely migrating from Vendor to Seller, or they are adopting a hybrid approach.
When brands fully leverage the Seller Central model, they have more control over their brand experience. From pricing to customer experience, imagery, and promotions, you can control all aspects. It’s completely possible for brands to have a similar D2C experience on Amazon as you would your own e-commerce platform.
Moreover, brands who are on Seller Central have additional insights into their consumer behavior. Unlike Vendor Central, Seller Central allows you access to data like conversion rates and session percentages on all your listings. Not only does this information enable brands to strategize within their Amazon account but gives them useful insights to use off the marketplace as well.
Despite Amazon’s best efforts to ensure the legitimacy of products listed on the marketplace, it’s inevitable some products will slip through the cracks. Although I’m not discrediting Amazon’s reliability, the only true way consumers are guaranteed legitimate products is when they are purchased through the manufacturer.