Transparency Fights Counterfeit eCommerce Practices

eCommerce faces a constant battle against counterfeit goods. Although, the days of rampant counterfeits are behind us there are still some cases. They come in all shapes and sizes. For example, there is a Spider-Man toy with DC branding and daredevil as the name on the box. That’s an extreme example, but they happen and some people still buy them. People can get scammed off of certain “person to person selling” websites as well. However, brands like Amazon are fighting against counterfeits. Transparency is the enemy of counterfeit products and Amazon has an item-level tracing service in its namesake. This isn’t a new service. Transparency has been around since 2017. So, how does it work?

Transparency’s motive is a win-win situation for consumers and brands. Consumers get the benefit of receiving the item they ordered instead of a counterfeit. Brands get the recognition of always providing excellent products/services. The service begins when a brand enrolls with Amazon Transparency. Once enrolled, the company will be issued a series of “transparency” barcodes. Every company needs to put the barcode on every unit of a product they intend to sell.

The unit will then be issued a unique code. Each code is tracked back to the brand to guarantee its uniqueness. If an enrolled seller sends their products without codes, the product will either be rejected or destroyed. Consumers can guarantee an item’s authenticity by using the Amazon app. They can scan the barcode and then be notified the authenticity.  However, it’s not all sunshine and roses for this service.

Soo-Haeng Cho, Associate Professor of Operations Management from the Tepper School of Business at Carnegie Mellon University, has reservations about the service. The service focuses mostly on packaging to fight counterfeiting. The package is real. But, are the items inside of the package real? What if someone tampered with the interior and switched the authentic products with knockoffs?

Cho brings up these points, as well as, the crux of the issue. He believes that eventually, technology will exist that can mimic the labels themselves. That will single-handedly dismantle the service. His final reservation comes in the form of financials. Smaller brands that enroll will not be able to afford the costs associated with the service. An extra one to five cents per unit needs to be paid. That adds up over time. What will the future hold for the Transparency service? Will Amazon adapt to these issues? How can eCommerce fully rid itself of counterfeit products? As always, only time will tell.

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