How Brands Are Battling Knockoffs on Amazon

If you’re a skincare brand, you’ve probably put a lot of thought into how your products smell and feel. So reading reviews on that say one of your creams reminded the consumer of “month-old milk” or that “it literally feels (and smells!) like rubbing your face with ham grease” is bound to be distressing.

That’s the position that Debora Pokallus, CEO of natural skincare brand Bel Essence, found herself in a few years ago when she realized that a third-party seller on Amazon had been using expired product to fill orders for Bel Essence’s Intensive Anti-Aging Treatment.

For Wei-Shin Lai, CEO of SleepPhones—headphones designed to wear while sleeping—trouble on Amazon has come in the form of inferior knockoffs.

“They basically take a generic headband, make a slit in the back, shove some earbuds inside and call them ‘sleeping headphones,’” she explains. “Then with Amazon Ads, they bid on ‘SleepPhones’ so that their cheap product shows up next to our premium product. Customers are lured to try out the cheaper product, which are often shipped from overseas with fake reviews.”

Stories like these highlight a growing problem: Copycat products are widely available on Amazon thanks to the proliferation of third-party sellers—1.2 million of which were added in 2019.

A spokesperson for Amazon emphasizes there’s a difference between knockoffs, which are regarded as generic versions of a product and are therefore acceptable; counterfeit products, which the company has developed programs to prevent; and unauthorized sellers—who, according to the spokesperson, sell legitimate products and whose presence point to a distribution issue.

Regardless of which category they fall into, though, the availability of these products on Amazon poses a real problem for brands that want to control quality, the customer experience and their reputation. And battling them can be a never-ending process.

“Sometimes I feel like it’s a full-time job just managing Amazon,” says Ira Kaganovsky Green, CEO of natural deodorant company Free Brands.

Even if a brand determines that a product is fake and succeeds in getting Amazon to take down the listing, 10 to 20 other listings pop up in the meantime, says David Barnett, CEO of consumer electronics accessories brand PopSockets.

“It’s like Whac-A-Mole,” he says. “You’re almost always losing the sale to one or another counterfeiter.”

So what’s a business to do when its product gets knocked off on Amazon? And what’s Amazon’s responsibility not just to brands but also to consumers who may not know they’re not buying the real thing? We talked to brands big and small in search of answers.

To be or not to be on Amazon

Both Birkenstock and Nike stopped selling on Amazon in recent years in part because they could not control the customer experience.

But opting out is more complicated for smaller brands.

While Amazon has not disclosed how many shoppers use the platform—other than noting its Prime membership program has surpassed 150 million users worldwide—analytics firm SimilarWeb estimates the site receives more than 2 billion monthly visits.

Access to an audience of that magnitude can be costly for a small brand to forgo.

In January, PopSockets CEO Barnett testified at a U.S. House of Representatives field hearing on the market power of online platforms and said the brand stopped selling through Amazon because of fakes and lack of what he described as a “true partnership” with the platform in dealing with the problem. Last month, however, PopSockets returned, albeit with a limited selection, in part because “we lost about $10 million last year,” he says.

Like many of the brands Adweek spoke to, PopSockets also realized that because of third-party sellers, its products will be on Amazon whether the brand itself is selling them or not. So it seems if you can’t beat ’em, you have to join ’em.

This story first appeared in the Feb. 10, 2020, issue of Adweek magazine. Click here to subscribe.

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