On 28th February 2019, Amazon announced the launch of its (much anticipated) anti-counterfeit program Project Zero. It did ruffle quite a few feathers in the e-commerce industry because, after the retail giant’s admission that counterfeit products were eating into its profits and reputation, it had proactively done something to fight this menace. The news of this announcement had mixed reactions from brands and third-party sellers.
Why the Secrecy?
The timing of the announcement is a bit disconcerting. Just a couple of month’s ago, in January, in its most candid admission (in the Form 10-K submitted to the SEC), Amazon had said that the counterfeit problem on its platform was huge and that they had no means to fight it. Many major brands had pulled off their products from Amazon’s shelves and one organization had also asked the US authorities to blacklist some of Amazon’s international platforms for their inability to disallow fake product sellers from operating.
And just a few weeks later, Amazon announces Project Zero, which should have taken them months to develop and test. By Amazon’s own admission, it had been testing this platform with a number of brands before announcing it. So, why did Amazon withhold information that it was developing a platform to address the counterfeit product menace that was sullying its reputation?
We’ve been getting interesting queries about how simplyBrand’s solution compares to Project Zero. So we thought of clearing the air. Below is a brief dissection of Project Zero and its tools. What follows next is an objective comparison.
Project Zero — Too Little, Too Late?
The program is essentially based on three tools — automated protections, self-service counterfeit removal tool and product serialization. Below is a detailed discussion on how these tools work, their shortcomings and how simplyBrand has a better solution.
· Automated protections
Automated protections, according to Amazon, are based on machine learning, where products are continuously scanned and fake products removed. Brands have to provide Amazon with information regarding logos, trademarks and other key data that will enable their algorithms to detect fakes.
The input for this tool are the key data that brands will provide that will help it to detect fakes. But as we all know very well that counterfeiters have become smarter and create product packaging that is impossible to distinguish from the original. Only after using the product can a customer realize that she has been cheated.
simplyBrand realizes this problem and that is why it uses crowdsourced detection methodologies in conjunction with its state-of-the-art AI capabilities. This “humint,” or human intelligence (HI) quotient, works closely with its AI to detect fake products from a number of key giveaways, like product placements, sellers, supposed “brand pages” (which, if fake, can only be detected by the keen eyes of humans) and reviews of customers. This gives an unmistakable advantage to simplyBrand’s solutions vis-à-vis Project Zero.
sB’s AI+HI = faster, better, more accurate.
· Self-service counterfeit removal tool
This tool, touted by Amazon as a gamechanger, provides brands the ability to remove counterfeit listings themselves.
The self-service counterfeit removal tool, in our opinion, is a double-edged sword. There cannot be any control of who is taking down what if this capability is given in the hands of another party and not held by the platform provider. While many brands are going gaga over this tool, we believe that it can be used by miscreants to take down genuine products. What is to stop ethically dubious sellers from removing their honest competition using this powerful tool?
At simplyBrand, we do not offer these capabilities to brands, but use our 24×7 monitoring and detection system to detect urls selling fake products and provide this data to enforcement authorities who will work with the platform to take down these products. In our one-stop service, we work closely with such relevant agencies directly so that fake products can be removed swiftly.
· Product serialization service
This service provides a unique code for every “authentic” unit produced and brands have to put these codes on each of their products as part of their manufacturing process.
It is obvious that this tool will increase costs to the brand as they have to apply unique codes provided by Amazon for every single unitthey manufacture. This means that brands have to tweak their manufacturing processes to include this serialization process, leading to increased time and costs, which will, no doubt, have to be borne by the customer. According to Amazon, there will be an additional cost of $0.01 to $0.05 per itemfor serialization.
simplyBrand, on the other hand, does not utilize any such coding/tracking process and uses its AI and human-powered crowdsourced detection methods for monitoring, detection and take down. This keeps costs affordable and not dependent upon how many products/items are being protected.
· No clarity on post-action consequences
A major problem with Project Zero is its lack of clarity on what action will be taken against counterfeit sellers. Once the brand uses its self-service removal tool, what happens next? Is there any record maintained of that url? The seller? Are they punished? If not, then we know that they will spring elsewhere.
We know for a fact that the global counterfeit industry is not scattered but a very structured entity. It has lot of funds and the wherewithal to wreak havoc on the global e-commerce industry. It is just not enough to remove a url that sells fake products, but to maintain a public registry of all offending sellers and platforms that allow such sellers to operate. This is where simplyBrand has an distinctive edge.
simplyBrand has the “blockchain advantage.” Through blockchain technology, it can create a “whitelist” and a “blacklist” that can be permissioned to be visible to relevant stakeholders — brands, enforcement authorities, e-commerce platforms and consumers. This record is immutable and thus cannot be manipulated, even by simplyBrand, if it wishes to do so. This makes the entire process transparent, honest and trustworthy.
· Project Zero is only Interested in Big Brands
Finally, Project Zero is currently an “invitation-only” service. Most big brands are conspicuous by their thin or almost non-existent presence on Amazon due to its inability to stop counterfeiting. Project Zero is a way by which Amazon wishes to attract them. It is obvious that the first batch of invites would have gone out to major players like Nike, Hugo Boss, North Face who have only “paper presence” on Amazon. For all other brands/sellers, Amazon currently has a “waitlist” for this service.
The waitlist (or shall we say, disinterest?) of Project Zero for smaller businesses and brands, trying hard to establish themselves in the industry with high quality products, and the costs of using this service is a major deterrent. This service is affordable only to big brands who can shell the kind of money that Amazon demands and protect their products. Counterfeiters can then turn their attention towards faking products for small and medium business entities, who will feel exposed since they won’t be able to afford the costs of Project Zero.
simplyBrand, on the other hand, is for everyone. Its cutting-edge solutions provide a holistic service and does not charge per product. It is affordable, because we at simplyBrand honestly believe that online counterfeiting must stop. For us, though it is a business venture, it is guided more by our philosophy of making e-commerce clean, safe and joyful for customers. And hence we have created a system that is affordable to brands of all sizes.
A quick comparison
How Project Zero will fare will be seen in the days and months to come. While it is a welcome step by the world’s preeminent retailer, it has its shortcomings that are glaringly obvious. It will be interesting to note how brands react to it and whether they will opt for these services. While many major brands have “welcomed” this step from Amazon, they are surely not gung-ho to climb onto the Amazon bandwagon. They are sceptical and are biding their time to see how this experiment by Amazon takes shape.
simplyBrand has been providing its anti-counterfeit services to brands since more than five years. It already has to its growing clientele some of the biggest names in the industry. This is testament to its service and solutions that is distinguishing it from its competitors. And, it is helping brands protect their products on not just Amazon, but all major online stores of the world.
In the past, brands have criticized Amazon for doing precious little to fight counterfeiting, which has been an obvious menace right since the days when Amazon opened its arms to third party sellers. In this process to scale up, they lost control of quality assurance. In a sense, the counterfeiting monster is a creation of Amazon itself.
Now, with Project Zero, they have created a paper gun to kill the monster. And the worst part is that it is the responsibility of the brands to use that paper gun to protect themselves. Whether you consider the self-service counterfeit removal tool or the product serialization tool, the responsibility of protection lies with the brands themselves. So if fakes still persist, even after being part of Project Zero, Amazon can always say that the brands aren’t using their tools to effectively fight fakes and protect themselves. With Project Zero, Amazon takes “zero” responsibility.
Join us in our various community discussions on different platforms.