How to Deal With Amazon Listing Hijackers
If you’ve noticed an upswing in Amazon listing hijackers, you’re not alone.
Listing hijackers can wreak havoc on your sales–and if they’re selling cheap counterfeit versions of your product, they could tank your brand’s reputation. It’s part of the reason Birkenstock announced they were cutting ties with Amazon earlier this year, and a huge source of contention across Amazon seller forums.
Two weeks ago, we interviewed Amazon Sellers’ lawyer C.J. Rosenbaum about Amazon seller account suspensions. This week, we had another big Amazon question on our minds for Rosenbaum. How should sellers deal with listing hijackers?
Counterfeit vs. Unauthorized: What’s the Difference?
First off, it’s important to note the difference between counterfeit listings, which are closely aligned with trademark infringement and intellectual property rights, and unauthorized listings–which are much harder to police in the U.S.
Counterfeit refers to a product that is clearly a fake version of your own.
“Let’s say you got a shoe that’s made by a different factory, and you slap on a Nike swoosh,” says Rosenbaum. “Or you got another type of fleece, and you slap on the Northface label.”
On Amazon, a counterfeit hijacked listing could be a low-priced ASIN child knockoff under your parent listing that gains the buy box, and potentially damages reviews due to inferior quality.
Unauthorized refers to a seller is not in an agreement with a manufacturer to sell their product.
For instance, an auto dealership must be authorized by Chevrolet to sell a brand new Chevy.
Online, this is frequently third-party marketplace seller who purchased a branded product and proceeded to resell it on a listing far below the designated Minimum Advertised Price (MAP).
Which One Matters More?
Amazon states clearly that they take counterfeit seriously. However, brand manufacturers and private labelers frequently get the short end of the stick when attempting to shut down unauthorized resellers. Why? Because technically, it’s still legal in the United States.
One Amazon seller in an exclusive distribution agreement with a manufacturer tried to combat an unauthorized reseller using FBA to sell her products. This is the response she received when she reached out to Amazon:
It’s not entirely clear whether the reseller attained the product legitimately or not, but if they did, there is not much that this seller can do unless she can prove the product is counterfeit.
Rosenbaum explains. “Under U.S. law, as long as you buy in the stream of commerce, and it’s the same product, you have every right to resell it. Amazon doesn’t generally care about you being an authorized reseller or not as long as you got it from a good source.”
Is MAP Enforceable Against Unauthorized Resellers on Amazon?
Some manufacturers and sellers point to the MAP agreements and claim that some unauthorized sellers are in violation of this policy. However, on Amazon, MAP—much like the pirate code—is more of a guideline than an actual rule. Rosenbaum explains why.
In [’07], the United States Supreme Court, [there was a case called Leegin Creative Leather Products, Inc. v. PSKS, Inc.] The Supreme Court said you have to do an analysis: What’s best for a society? If it’s a product like you know it’s going to cure cancer, the court wants to protect those companies that develop life-saving products, so in those cases, [they’re] going to enforce MAP.
However, if it’s something like a t-shirt or a phone or a pair of sneakers or a label maker, the benefit to society is having lower prices, and they’re not going to enforce MAP…so in 42 states there’s basically no MAP pricing. Amazon doesn’t care about MAP pricing either—at least that’s the current stance. [emphasis mine]
To an extent, it is true. Amazon prioritizes the customer experience, and a large part of this is by offering competitive pricing for products. This also affects sellers who adhere to MAP and have to compete with those who don’t.
One seller vented their frustration on an Amazon forum:
“So as long as you don’t have an agreement with the manufacturer you’re not subject to their MAP pricing,” says Rosenbaum. “MAP is just a contract between a particular seller and a particular manufacturer.”
It seems MAP has lost its power, but nothing is set in stone. MAP pricing enforcement may change with the approaching U.S. election.
“The deciding vote in the Leegin case—the one that knocked out MAP pricing—was with Justice Scalia, who’s now [deceased],” says Rosenbaum. “The next president is also probably going to appoint…[up to three] more justices…and they are going to have to address issues like MAP pricing.”
How Do Counterfeit Products Develop?
When it comes to complaints about counterfeit products, Amazon has a more serious stance on violations, because this issue directly affects their #1 priority: customer trust and satisfaction.
Here’s what the Amazon Anti-Counterfeiting Policy says:
China is one country that frequently comes up when this subject is on the table, and for good reason. According to CBNC, in 2015, sales from Chinese-based sellers more than doubled on Amazon’s marketplaces.
Of course, not all Chinese sellers are illegitimate. According to Rosenbaum, “There are hundreds of thousands of legitimate Chinese sellers…selling to the U.S.” The issue occurs when those products that you commissioned from a Chinese manufacturer start making their way directly into the hands of other sellers.
Example of a Supply Chain Leak
Let’s say you’re a seller working directly with a Chinese manufacturer on a custom-built calculator. You can specify exactly what types of features you want this calculator to include; from solar panels to a tilted screen. The manufacturer produces it, and you create a listing.
A few months later, you notice other sellers popping up on your listing. If you can prove their calculators are counterfeit, then Amazon will likely boot them. But what if you can’t? What if:
- There’s a leak somewhere in the supply chain and resellers are exploiting it
- That original manufacturer started selling your calculator to other people
“That manufacturer could make another hundred thousand and sell it to whoever they want,” says Rosenbaum. “The scalability of factories in China is just insanely good.”
If your manufacturer is selling to other people, it could be difficult to prove. After all, manufacturers frequently work through trading companies that pitch these products to other sellers rather than approaching them directly. Rosenbaum explains.
It happens on the levels of trading companies in China, and filters all the way down to distributors here in the States…a lot of people think that the sellers reach out to distributors, but [it’s often] the exact opposite. The distributors say, “Hey I ended up with five cases of pens—do you want to sell it?” And if the seller says yes, they make the deal. And if the seller says no, they call somebody else.
“Wait a minute!” You might say at this point. “I made my manufacturer sign an exclusive contract so they wouldn’t sell to other people!”
Unfortunately, that contract may not hold much weight.
“You can get a manufacturer to sign anything you want, but enforcing it might be a little difficult,” says Rosenbaum.
7 Ways to Fight Off Amazon Listing Hijackers
First off, we are not going to give you “magic bullets” or any underhanded ways to knock off other sellers. The more time you waste on shortcuts that may not work, the less time you’ll have to actually fight those hijackers off.
It really is important to remember the fundamentals of Amazon’s infringement reporting process, though it may take more time and patience. As you go through the process, keep calm and follow these 7 tips from Rosenbaum.
1. Act Quickly
If you see counterfeit or unauthorized listings on your profile, deal with it ASAP.
“You have to start the process,” says Rosenbaum. “If you want to get them off [your listing], it’s better to get them off in three weeks than in six.”
2. Make Test Buys
Before you’re able to submit a complaint to Amazon, you must do a test buy—even if there are up to 20 people on your listing.
“I know that can be a pain in the neck…but you want to do a test buy from the top people, or all of them,” says Rosenbaum. “And a lot of people who are from overseas who are doing it have pretty long delivery times. So you could do a test buy that takes four weeks to get the product [shipped in].”
3. Create Detailed Reports on Test Buys
Once you assert your complaint, Amazon will email back asking for more information. It’s important to be strategic and remember Amazon’s goals. They don’t want to know how this affects you as the seller, says Rosenbaum. They want to know how that counterfeit product affects the customer.
“You want to find all the flaws and share why those flaws affect the customer because everything on Amazon is customer-centric,” points out Rosenbaum.
Here’s what you should examine:
“If you order a product and the packaging is incredibly similar, you want to identify each and every portion of the packaging that’s similar—the colors, the font, the verbiage, the product itself, how the product opens or closes, the warnings that might be on it.”
“Not only can you check the packaging on the product, let’s say it’s an electronics product—weigh it. If the authentic product has a certain, the counterfeit will likely have a different weight.”
- Product Construction
[Regarding electronics]: “Look at the coloring of the wires; how the batteries are held in place…check the product and see how it’s sealed, open it up and see if the wires are the same, or the batteries are the same manufacturer.
If nothing else is working, think outside the box. The last few tips will give you a few tools to get an edge on the competition.
4. Offer a Warranty
Let’s say you order a test product, and it comes back as the exact same product.
At this point, says Rosenbaum, there’s not really that much they can do unless there’s something that “materially alters the product.”
What does this look like? Rosenbaum explains: “If a Casio calculator comes with a warranty as long as it’s sold by the Casio store, and the hijacker can’t offer the warranty—then it is materially different, and you can get [that seller] knocked off.”
5. Bundle Your Products to Increase Value
This is where it helps to get creative, and think about making your product more valuable in your customer’s eyes.
“Let’s say you package that calculator with other things to sort of make it your own—like a cable or printer tape—to make it different…it could be a booklet, a recipe book, other cables, accessories, an online membership…improve it, make it better, make it different.” [emphasis mine]
6. Source or Manufacture Products on U.S. Soil
If you are a seller also manufacturing your own products in the U.S. dealing with counterfeit knockoffs, it’s one thing. But let’s say you typically use a Chinese manufacturer for your private label products. Does it help to use a manufacturer on U.S. soil?
“If you can source it and have your stuff built here [in the U.S.] it would be a little better,” says Rosenbaum. “You could sue someone here and get a court injunction. I’m not so sure that’s a viable option on most products, but I do think that’s a huge selling point. Americans will pay more for stuff built in America…especially in election year.”
7. Revamp Your Products and Start a New Listing
If you have tried all of the above and failed, it may be time to simply revamp your product and get a new product listing. However, you should still go through the steps to remove the other sellers from your current listing.
“You’re not selling the same thing anymore because you’ve updated the color, the mechanism, the springs, the number of [protections], whatever—you’ve made the product better. It helps you, your brand, it flies right into Amazon’s [policy] of always making the customer the best—you should make your product better.”
Pro-tip: Place codes on your updated product so you can better identify counterfeits and supply chain leaks in the future.
Want to learn more about brand policing and protecting against counterfeit products and unauthorized sellers? Check out these posts:
- Policing Your Brand on Amazon: Copyright & Trademark Infringement
- Brand Enforcement: Actionable Steps Brands Can Take Against MAP Violators
- Brand Protection On Amazon Against Unauthorized Sellers
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