The fight against counterfeiting requires accountability, technology and education

Counterfeit and pirated goods are not new. They have been sold for years on street corners and outside car trunks. In some countries this is still the case. It was not too difficult for consumers to identify the goods as illegitimate. The price, the quality and, of course, the place where these goods are sold were clear gifts. However, like many other parts of our lives, the counterfeit trade has made its way from analog to digital. In the online world, distinguishing the real from the fake can be much more difficult for consumers and can leave them with a defective product that doesn’t work properly, breaks down quickly, or doesn’t live up to their expectations. Often the blame is placed on the authentic company, which forms a damaged image of the brand. Authentic brands face a tough battle against counterfeiters who work very effectively online, stealing the company’s design and brand and even mixing their original goods with online reviews of the brand’s products. The images used by the product are sometimes real photos of the brand owners, leaving the customer to play a guessing game between real and fake.

To mark World Anti-Counterfeiting Day, Amazon has released its second Amazon brand protection report, sharing its progress in combating protection against both sellers and customers against counterfeit goods, fraud and other forms of abuse.

In 2021 alone, Amazon is investing more than $ 900 million and more than 12,000 people in the venture. Efforts have halted more than 2.5 million attempts to create new sales accounts, preventing these bad participants from publishing a product for sale. Like real life, where taking a seller to a corner doesn’t stop them from finding a new place, the fight against online counterfeiting needs to be wider than one store. Industrial collaboration between online retailers and between the private and public sectors is a must, so Amazon has created a plan to maximize impact.

“We feel strongly that there is no competition in the world of counterfeiting,” said Mary Beth Westmoreland, Amazon’s vice president of brand protection. “We tried to build our program so it’s not specific to Amazon. IP Accelerator, which helps brands get a trademark, protects their brand everywhere, not just on Amazon. The Anti-Counterfeiting Unit identifies and confiscates counterfeits so that they are not returned to the supply chain. Whether or not a brand is sold on Amazon, it can still share IP information with us, share product information, and send notifications of potential infringement. “

Accountability

Amazon’s work to ensure that customers can trust their shopping focuses on sound and effective proactive techniques to protect stores and brands and hold them accountable from bad participants. Bringing bad actors to justice is the only way for the industry to gain the upper hand over counterfeiting. That’s why in 2020, Amazon set up Amazon’s Counterfeit Crime Division (CCU), a team of former federal prosecutors, FBI agents, experienced investigators and data analysts. Trafficking in counterfeit goods is a multi-million dollar global crime involving well-known organized crime groups. Offering high profits and low penalties, in part due to public acceptance, the sale of counterfeit goods remains a very attractive business. Last year, Amazon filed civil lawsuits against more than 170 counterfeiters in U.S. courts and tried or referred more than 600 criminals for investigation in the United States, Europe and China, an increase of more than 300 percent compared to 2020.

technology

Increasing the peace of mind of buyers is twofold. On the one hand, there must be confidence in the sellers who have access to the store, and on the other hand, there must be powers to protect, not to challenge, intellectual property (IP). And machine learning can help both.

The process begins with a robust vendor verification process that includes a personal verification program that requires prospective vendors to interview one-on-one members of Amazon’s team to verify their identity and documentation. This verification is further enhanced by proof of the seller’s physical location and payment instruments. Machine learning models are also used to detect risk by using hundreds of data points for the future account, such as payment methods, business location, previous activities, and even links to previously imposed bad participants.

The technology is also used to continuously monitor Amazon.com for potential violations. For example, Amazon’s automated technology scans more than 8 billion attempts daily to change product detail pages for signs of possible abuse. In 2021, Amazon blocked more than 4 billion bad ads before entering the store. These lists were suspected to be fraudulent, copyright infringing, counterfeit, threatened with other forms of misuse or pose significant concerns about product quality.

Fighting bad actors is only one side of the coin. The other is to ensure that brands and their IPs are protected. Amazon has created a trademark registry, a free service for trademark owners to manage and protect their trademark and intellectual property rights, whether or not they sell to Amazon. In 2021, the Brand Registry increased by 40% compared to the previous year, with over 700,000 registered brands. In addition, improvements in automated protections powered by machine learning models have resulted in fewer infringing products in the Amazon store. As a result, the average number of valid infringement notices filed by a trade mark in the trade mark register has decreased by 25% since 2020.

For many businesses, especially small businesses, the barriers to protecting their IP start with actual registration. Time and money are too much for some. Amazon IP Accelerator helps companies gain intellectual property rights faster by allowing brands to protect their IP in any store, not just Amazon. IP Accelerator connects the business with a curated network of trusted IP law firms that provide high quality trademark registration services at competitive prices. In 2021, 5,900 small and medium-sized enterprises benefited from the IP Accelerator.

All of these tools power Amazon’s machine learning algorithm with millions of data points to identify and detect IP breach before it affects the customer. Sharing information between the private and public sectors will only help to improve these models of machine learning. That’s why in 2021, Amazon improved communication and support with the U.S. Patent and Trademark Office (USPTO). Amazon now uses information directly from the USPTO to prevent fraudulent trademark applications and registrations from being entered in its trademark registry. In return, Amazon shares information about abuses and trends in its stores to support the USPTO’s investigation into potential fraud by its applicants and registrants.

Education

However, all these efforts would be somewhat in vain if consumers were not better educated to shop with confidence and deliberately avoid counterfeiting.

A 2019 study by the International Trademark Association showed that while Gen Zers strongly values ​​the value of people’s ideas and creations and 74% think it is important to buy original products, 57% think their money is better to benefit the local counterfeit seller rather than a large corporation. This thinking is related to a somewhat romanticized idea for people who sell counterfeit goods. As mentioned, more often than not, these bad actors are part of organizations that exploit workers and engage in other illegal activities. For example, Europol is finding links between migrants who have been smuggled across borders and organized crime groups with children used to produce counterfeit goods.

A study by the International Trademark Association also found that 91% of the Zer generation have expressed openness to changing their views on counterfeiting based on new things they are learning, stressing that education is a critical part of how counterfeiting can be defeated in the long run.

We often believe that technology can solve all our problems, even those that have somehow helped to create in the first place. However, the reality is that while technology such as machine learning can lend a hand, we need to bring about a change in behavior at the root of the problem. First, we need to educate consumers about the hidden costs of buying counterfeits and thus change public opinion that this is not a crime that should be taken lightly. Second, we need to support businesses more in their protection of intellectual property, which is crucial for innovation.

Disclosure: The Heart of Tech is a research and consulting firm that engages or has participated in research, analysis, and consulting services with many technology companies, including those mentioned in this column. The author does not hold shares in any of the companies mentioned in this column.

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