Will Amazon’s ‘brand gating’ put counterfeiters out of business?
Counterfeiters and unauthorized sellers have long caused problems in Amazon.com’s relationship with brand manufacturers. Now comes news the e-tailing giant is getting tougher with new sellers on its marketplace. The company will now require proof of purchase from popular brands and one-time fees up to $1,500 per brand.
“We want customers to be able to shop with confidence on Amazon,” Erik Fairleigh, an Amazon spokesperson, told CNBC. “For certain products and categories, Amazon requires additional performance checks, other qualification requirements, and fees.”
Amazon is taking this action — called “brand gating” — less than a month after Birkenstock announced that beginning on Jan. 1st it would no longer do business with the site or any of its third-party sellers. The brand made the decision after finding a large increase in counterfeits being sold on Amazon along with a big jump in unauthorized sellers.
Birkenstock USA CEO David Kahan sent an e-mail to the brand’s retail customers to explain the decision.
“The Amazon marketplace, which operates as an ‘open market,’ creates an environment where we experience unacceptable business practices which we believe jeopardize our brand,” he wrote.
“Policing this activity internally and in partnership with Amazon.com has proven impossible,” Mr. Kahan added.
Reports have identified Adidas, Funko, Hasbro, Hewlett Packard, Lego, Nike and Samsung among the brands being checked as part of Amazon’s new protocol.
- Amazon’s plan to fight counterfeiters will cost legit sellers a ton – CNBC
- Amazon tacks on a fee to sell select brands on its marketplace – Internet Retailer
- Amazon Wants Proof of Purchase From Sellers – PYMNTS.com
- Will other brands follow Birkenstock in cutting off Amazon? – RetailWire
DISCUSSION QUESTIONS: Will Amazon’s “brand gating” make a serious dent in the amount of counterfeits and unauthorized sellers on its site? Will the fees and process associated with the practice drive away legitimate sellers as well as those being deceptive?