E-commerce firms deny shipping fake products
Bengaluru: India’s leading online marketplaces including Flipkart Online Services Pvt. Ltd and Amazon India Ltd on Thursday defended their platforms and denied they were shipping fake products to millions of customers after two media reports this week claimed that e-commerce companies were selling counterfeit products.
On Monday, The Economic Times reported that footwear maker Skechers had filed cases against Flipkart and at least four sellers on its platform, for allegedly selling counterfeit products that carried the Skechers brand.
On Wednesday, a report from the Network18 media group alleged that over 60% of products sold under the sports category of leading e-commerce websites were fake, while at least 40% of all apparel listings online have been produced by duplicate manufacturers. It did not clarify how it arrived at these numbers.
The allegations, if eventually proven true, could severely crimp near-term enthusiasm for online shopping among new-age, smartphone-savvy consumers and dampen the rise of online retail in India, which is widely seen as the world’s last remaining major e-commerce market. Several top investors including Japan’s SoftBank Group Corp., South Africa’s Naspers Ltd and China’s Tencent Holdings Ltd have bet billions of dollars on the success of online retail in India, while a number of brokerages and analysts have predicted that India’s e-commerce market will touch $100 billion over the next decade.
Amazon India said it removes counterfeit items from its platforms whenever the company becomes aware of their existence, and has “zero tolerance for counterfeit”.
“Amazon’s customers trust that when they make a purchase through Amazon.in—from one of its sellers—they will receive authentic products manufactured by the true manufacturer of those products. To preserve that trust, Amazon is investing heavily in protecting the integrity of the Amazon marketplace for consumers, sellers, and manufacturers. Amazon is also working closely with rights owners to strengthen protections for their brands on Amazon. We remove suspected counterfeit items as soon as we become aware of them, and we suspend or block bad actors suspected of engaging in illegal behaviour or infringing others’ intellectual property rights. We have taken independent legal action against bad actors, and will continue to do so. And we work with law enforcement who present us with valid legal process,” an Amazon India spokeswoman said.
Flipkart, which is contesting the allegations of fake Skechers products being sold on its online marketplace, also echoed similar sentiments and said it had “stringent” policies in place to avoid selling counterfeit products to consumers.
“Flipkart is an online marketplace that helps sellers connect with customers across the country. We only act as an intermediary but being a responsible company, Flipkart has a robust system of checks to ensure that any instances of fake or spurious products are detected quickly and delisted. Our sellers are also mandated to adhere to certain guidelines if they sell with us. Flipkart observes a zero-tolerance policy on incidents where sellers are found violating customer trust and quality guidelines. We conduct our business with the highest standards of integrity and are fully compliant with all rules of the land. Flipkart also runs customer awareness programs that educate and caution customers against falling prey to fake products or fraudulent offers. We cannot comment on the current issue as it is sub judice,” a Flipkart spokeswoman told Mint in an email.
“We coordinate with brands on a regular basis to help keep the site clean of counterfeits. Through our ShopClues intellectual property protection programme, we make it conducive for brands and rights owners to reach out to us and to protect their IP. Our robust system under the ShopClues Surety programme also ensures that our merchants sell genuine products. We have zero tolerance for counterfeit/fake products,” said a ShopClues spokesperson.
The latest allegations against e-commerce platforms is, however, not the first time that online retailers have drawn flak over products sold.
A few years ago, in 2013, a Flipkart customer received a pair of stones after placing an order for an iPod. In October 2014, a Snapdeal customer received a bar of soap after ordering a Samsung phone.
To be sure, these kind of delivery glitches are extremely rare in Indian e-commerce, especially in online marketplaces such as Flipkart and Amazon India, which continue to maintain Six Sigma levels of quality—the highest possible rating that can be assigned to an online retailer.
However, these blunders and glitches are likely to become even more cumbersome to manage in the near future, with the likes of Flipkart and Amazon India aggressively adding thousands of sellers on their platforms every year. This, in turn, makes it harder for online retailers to ensure that third-party sellers and merchants sell original, first-hand products to customers.
Moreover, reports of fake products being sold online harm the image of online retailers and result in distrust among consumers.
India is not the only country that faces these kinds of glitches in online retail. Globally, top retailers such as Alibaba, Amazon and eBay have also struggled to weed out counterfeits and second-hand products.
Alibaba, for instance, had to fire a number of top and mid-level executives in 2011 after it discovered that these executives had granted special status to more than 2,000 sellers who had cheated customers.
Yuvraj Malik contributed to this story.
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