Amazon, under increasing pressure to tackle counterfeit products, said in its second-year report it prevented 4 billion bad listings on its site and removed more than 3 million fake products last year.
The results, released Wednesday, were mixed compared to 2020, when Amazon blocked 10 billion listings and removed 2 million fake products. The Seattle-based e-commerce juggernaut also saw a decline in intellectual property infringement complaints in 2021 while the number of active brands on its site increased.
According to the report, Amazon stopped over 2.5 million attempts to create fake accounts on its third-party marketplace, where sellers can list their products directly to consumers. That number is about a 58% drop from attempts it said to stop in 2020, which the company attributes to its vetting process and other efforts to deter bad actors.
But Juozas Kaziukėnas, the founder of e-commerce research firm Marketplace Pulse, said it can be difficult to independently know what caused the actual decline — be it Amazon’s policies or other factors.
Counterfeit sellers have long plagued Amazon and other e-commerce retailers, including eBay. And Amazon has stepped up its efforts to fight it recently, amid heightened scrutiny from brands and lawmakers pushing for anti-counterfeit laws.
Amazon is supporting a House version of an online retail account known as the INFORM Act, which would require online marketplaces to collect contact and financial information from major sellers and release some of the data to consumers. Amazon had opposed an earlier Senate draft of the bill requiring online retailers to collect data from a larger group of third-party sellers.
Meanwhile, TechNet, a lobby group that considers Amazon and eBay members, is pushing back against another bill that would hold e-commerce platforms liable for counterfeit goods sold on their sites. An Amazon spokesperson said in an emailed statement that the company recognizes that “the intent of the legislation is to stop counterfeiting” and looks forward to working with Congress to achieve that goal.
In its report, Amazon said it implemented a program last year that made it more difficult for bad actors to register for account sales by requiring one-on-one conversations with a corporate team member to verify their identities. It also says it proves the seller’s physical location and payment instruments and uses machine learning to detect risks about potential accounts.
Last year, the company said it spent more than $900 million to fight fraud and charged — or referred — more than 600 sellers for investigations in the US and other places like China. Amazon did not reveal the source of most counterfeit products in the report, but China is a sore spot. And the company won’t share data that helps it detect and prevent fake products from appearing on its site, said Mary Beth Westmoreland, Amazon’s vice president of brand protection.
According to Marketplace Pulse, the share of China-based merchants has been steadily declining in Amazon’s external market since late 2020, a trend some experts believe may be caused by pandemic-induced supply chain snafus and the company’s recent efforts to act hard. prohibited activities, including fake reviews. Last year, the company suspended several prominent China-based merchants and reportedly evicted 50,000 merchants for violating its rules.
Marketplace Pulse data shows that 55% of the top sellers on Amazon’s US marketplace are domestic businesses, up from 48% in November 2020.