The Dark Side of Double 11

2018-11-12 15:19:56

What started as a celebration of singles on college campuses across China in the late 90s has today become a worldwide shopping phenomenon that cannot be described aptly by any adjective in any language. The Single’s Day Shopping Festival which has been transformed into the “Double 11” event is so huge that a look into the statistics can befuddle any economist of the world, leave alone a simple individual.

Photo credit: Xinhua

A few days back, on 11/11/2018, Alibaba alone generated sales of more than $31 billion, calculated on the basis of gross merchandise volume. All of this in a 24-hour period. If you add other Chinese retailers, the figure breaks the roof. Take, for instance, that sold products worth more than $19 billion in 11 days, centered around Single’s Day. Now compare this to the measly $6.5 billion that Americans splurged on Cyber Monday and $5 billion on Black Friday, and you’ll realize how big the “Double 11” event has become.

But all is not smiles and sunshine in this phenomenon. The monster of fake products has raised its ugly head in what was supposed to be a celebration of life itself, of gifting happiness to oneself and to loved ones. Within hours of receiving their products, thousands of customers took to social media to display the quality of products they had received and how they had been duped by counterfeiters with the promise of a good deal.

Just a couple of months’ earlier, in an extraordinary case that has rocked online commerce, raids by New York police uncovered a whopping $450 million worth of counterfeit goods, all coming from China. In a carefully planned modus operandi, these fake products are manufactured in China and brought illegally to the US mainland. Once they land at a port, they are shipped to different places inside the United States through registered business entities. Then these same companies hold these fake products in warehouses, to be shipped back to China through online channels so that they seem like coming from the US. Reputed products like LV bag, Chanel perfumes, Tony Burch bags, Michael Kors wallets, Hermes belts and many more were faked and sent back to China. Many of these products are also sold in storefronts in major cities like New York. The 22 people who have been detained by the police are thought to be using money from this counterfeiting business to launder money.

Photo credit: xPACIFICA/Getty images

In a similar police raid in Italy, authorities seized counterfeit goods worth almost 1.2 million euros. Using legitimate businesses, these counterfeiters were easily able to move fake products within the country and sell it through legit outlets to unknowing customers. Authorities say that this is not the handiwork of a handful of individuals. But it is a well-organized structure that has been doing this shady business for years. And the $450 million worth of goods is just a fraction of what is currently there in the US and is absolutely nothing compared to the amount of goods they have sold in the previous years.

However, authorities are waking up to the real danger of the counterfeiting industry. Consumers are also getting more knowledgeable but at the same time counterfeiters are also becoming smarter by the day. It is what is called the “host-parasite co-evolution” in Nature. When the parasite stays inside the body of the host animal, the host body evolves to remove the parasite from the body. However, the parasite also gets smarter and evolves processes that allows it to counter the offensive forces of the host.

We, thus need a holistic way to fight online counterfeiting, which, by the way, is a $323 billion industry. While there are many solutions available in the market to fight counterfeiting, we, at simplyBrand, have created a unique platform that not only uses high-end technology, but also involves the help of the most important stakeholder in this system — the individual customers. Our easy-to-use DApp uses a combination of cutting-edge AI, blockchain and crowdsourced information from human intelligence to detect and blacklist urls selling fake products online. This blacklist is then made available on a public blockchain for everyone — brands, consumers and enforcement authorities — to see and act upon.

simplyBrand creates a comprehensive hurdle on the most important step of the product lifecycle — at the marketplace level. This leads to economic and reputation losses to counterfeiter and also to the online shopping sites that allow such unscrupulous merchants to use their platforms for illegal activities. Our platform also encourages customers to participate in anti-counterfeiting activities and rewards them for successful reporting. It also educates customers on how to spot fakes and the modus operandi of counterfeiters so that they can take informed decisions the next time they shop for their favorite brands online.

At simplybrand, we are seeking to create e-commerce that is safe, secure and fun. We invite you to participate in our efforts. You can see more on what we do on our website. You can also become part of our ever-increasing community on Telegram. And also please follow us on Facebook and Twitter for more updates.

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