As an e-commerce player, you’ve certainly heard of customers receiving fake items they ordered on Amazon: Knock-off footwear that looks similar to Adidas or Nike, top-brand or luxury handbags that are slightly off, or sporting equipment that doesn’t deliver the same quality a customer was expecting. This can also be dangerous, with nefarious sellers delivering shoddy medications, supplements, and beauty products for both people and animals.
Counterfeiting of this nature is a huge issue that continues to rise. As much as counterfeiting is a problem from a customer perspective, it’s also become a huge issue for Amazon. For a company that basks in the light of customer trust as a beacon of customer service, counterfeit products are a bad experience and a huge logistics problem. Enter Project Zero, Amazon’s new project aimed at reducing counterfeiting on their website.
The rise of third-party sellers
For the first time earlier this year, Amazon addressed counterfeiting in its Annual Report to shareholders. Listing the issue as a “risk factor” and possible detriment that was likely to affect Amazon’s adversely.
On April 11, Amazon’s blog Day One published a letter from Jeff Bezos to shareholders. It detailed the rise of third-party sellers in recent years, specifically, that third-party sales have grown from 3% in 1999 to 58% in 2019. These numbers represent the share of the third-party side as compared to Amazon’s own business.
Bezos credited helping “independent sellers compete against our first-party business by investing in and offering them the very best selling tools we could imagine and build. There are many such tools, including tools that help sellers manage inventory, process payments, track shipments, create reports, and sell across borders – and we’re inventing more every year. But of great importance are Fulfillment by Amazon and the Prime membership program.”
With so many operators in the marketplace, it’s obvious that counterfeiting would increase.
In 2019, Amazon announced a new program for vendors and sellers, with a goal of reducing persistent counterfeiting issues. Project Zero, allows legitimate brands more direct control over product listings. Enrolled brands can flag and remove counterfeit items all on their own, via a self-service tool.
Up until recently, Amazon required brands to make a claim through a reporting system. Investigations and take-downs were slow. The new program takes a three-pronged approach:
- Automation: Powered by Amazon’s machine learning technology, brands can provide key data points such as trademarks and logos. These listings are scanned (at a rate of over 5 billion listings daily) to look for suspicious items.
- Self-service: Brands can now use Amazon’s tools to flag and remove products on their own.
- Product serialization: Brands can apply a unique code on every unit they manufacture for an enrolled product. Amazon can then scan and confirm the authenticity of every one of those products purchased in Amazon’s stores.
With these measures, Amazon hopes to stop counterfeit items before they even reach customers. Eliminating returns, poor ratings, and numerous headaches.
Who can participate in Project Zero?
Project Zero is free to join and allows brands to access access better brand protections. The program is currently invite-only and has a waitlist. Another caveat: Project Zero is open only to brands with a government-registered trademark who have also already enrolled in the Brand Registry. As of April 2019, Project Zero is available to brands in the United States only.
Joining Project Zero
Project Zero is now officially up and running.
"We've continued to make progress in reducing the amount of counterfeit in our store… but the fact is that today, that number's not zero. There are still counterfeits," said Dharmesh Mehta, Amazon's vice president of customer trust and partner support. According to Mehta, Amazon caught three billion suspicious listings last year before buyers even saw them. But Project Zero will, hopefully, catch far more.