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Category: Online shopping

Attention Walmart.com Shoppers: Now Offering Counterfeits

In an effort to compete with Amazon, Walmart.com has significantly increased its product selection by offering items from third-party sellers. While third-party offerings provide consumers with more options, online shoppers may want to proceed with caution.

Launched in 2009, Walmart’s Marketplace allowed select retailers to list their products on Walmart.com. Recent partnerships have ballooned Walmart.com’s product selection from 10 million to more than 50 million items in the past year alone. All of which is due to an increased number of third-party marketplace sellers.

By offering a wider selection, Walmart.com has become more attractive to online shoppers. The site is now the 3rd-most-visited e-commerce site in the U.S., with 89 million unique visitors per month, according to comScore.

But with this success has come a problem that troubles open marketplace retailers like Amazon.com and eBay: the sale of counterfeit products.

The Counterfeit Report has repeatedly found and submitted complaints to Walmart, authorized by the trademark holders, for counterfeit items found on its website. Yet months later, some items remain while others are removed, but then are relisted.

As the top retailer in the U.S., most consumers would perceive Walmart as a trustworthy merchant of authentic goods. But online shoppers, who are unaware of third-party items, misplace their confidence when shopping online at Walmart.com.

Walmart Marketplace items include items from international companies, like China – the counterfeit capital of the world. These items show up right alongside Walmart’s own inventory leaving little differentiation between the store’s verified merchandise and potentially counterfeit third-party goods.

Walmart has recently been criticized for not monitoring its marketplace counterfeit problem. The Counterfeit Report, a self-described consumer advocate and watchdog, “has repeatedly found and submitted complaints to Walmart, authorized by the trademark holders, for counterfeit items found on its website. Yet months later, some items remain while others are removed, but then are relisted.”

While it’s impossible to prevent counterfeits completely in an open market, Walmart is failing to remove even reported counterfeits from their site. You’d think a nationally recognized brand like Walmart would be proactive to protect their customers from fakes. For the time being, Walmart.com shoppers may want to steer clear of the online aisles.

What’s your take? Does the risk of purchasing counterfeit products affect your willingness to shop through Walmart.com?

RELATED: Prime Issues: Keeping Counterfeits Off Amazon

Prime Issues: Keeping Counterfeits Off Amazon

Much has changed since Amazon.com opened its virtual doors on the World Wide Web in July 1995. Today, the world’s largest online retailer offers 500 million products sold by 2 million sellers; many of which are third-party vendors. In fact, 50 percent of units purchased last year were sold by third-party sellers.

While many third-party sellers are legitimate enterprises like major retailers and brands and small business, Amazon basically lets anyone sell nearly anything on its platform – including Chinese manufacturers. Notorious for counterfeit products, sales from Chinese-based sellers have more than doubled on Amazon’s marketplaces in recent years.

Oftentimes, consumers are unaware that their items are from unknown and unvetted sellers overseas. Unsuspecting customers may perceive a fake item as legitimate because of the Fulfillment by Amazon (FBA) endorsement. But this designation only means that the item is being packaged and shipped by Amazons fulfillment centers. Furthermore, Amazon commingles inventory – bundling together multiple third-party sellers – so that a counterfeit item could be sent to an Amazon facility by one merchant but sold by another.

Customers aren’t the only ones complaining. The company has begun to face legal pressure from brands including Apple and Birkenstock for allegedly enabling the widespread sale of counterfeits on the platform.

As a marketplace, Amazon isn’t legally responsible for keeping counterfeit items off the site; they are only required to respond to complaints and take action when fakes are brought to the company’s attention.

While Amazon has an anti-counterfeiting policy and recently announced a meager attempt to protect trademarked merchandise, critics say Amazon has not made it a priority to manage the influx of counterfeits. In fact, there’s not a single mention of the word counterfeit in their 2016 Annual Report.

The sale of counterfeit products, including any products that have been illegally replicated, reproduced, or manufactured, is strictly prohibited.”  

With a such a vast, global selling platform, it seems impossible for Amazon to police the millions of items sold by third-party sellers. But if Amazon wants to maintain any consumer trust, they need to do much more to close their counterfeit loopholes.

RELATED: ATTENTION WALMART.COM SHOPPERS: NOW OFFERING COUNTERFEITS

Why Counterfeiters Love the Internet

On a daily basis, billions of people use the internet to buy and sell goods and services. The booming online economy has created an ideal environment for counterfeiters, whose trade has burgeoned.

The internet has revolutionized the way counterfeiters operate and remains a highly lucrative and sophisticated criminal environment. Counterfeiters are no longer sequestered to selling fake goods through rouge websites. Ecommerce marketplaces and auction sites like Amazon and eBay allow counterfeiters to sell direct to consumers through a global and largely unregulated marketplace.

1. Anonymity

For websites selling counterfeit merchandise, it’s common practice for the registrant’s name and address on a URL to be fake. Moreover, the warehouse or retail locations are often not revealed, which further conceals the identity of the seller.

2. Globalism

The internet allows counterfeiters to reach a global audience faster and with far less economic effort than the off-line world. Between email promotions, social media marketing and digital marketplaces, reaching potential buyers is easier than ever.

3. Targeting

In the early days of selling counterfeits online, items were exclusively sold through rouge websites in which the counterfeiter relied on key words and meta tags of brand names to show up in search engine results. Today, the Internet offers innumerable opportunities to attract buyers.

Social media channels enable fraudsters to easily and affordably launch global marketing campaigns. It’s easy to create an account and buy followers to look legitimate. For pennies on the dollar, targeted advertising through platforms like Facebook and Instagram ensure the items appears on interested users’ timelines.

4. Enforcement

Unfortunately, the Internet is a difficult place to enforce IP rights. Fighting IP infringements is both expensive and complicated. On top of playing whack a mole to shut down rogue websites, brands are now facing the dilemma of fighting fraudulent listings on social media, auction sites and marketplace listings.

Current regulations for auction sites and ecommerce marketplaces do not require these retailers to pre-emptively remove counterfeit listings; they are only required do so when notified by the customer or rights holder.