Insider Ties: Amazon, Counterfeits and the Battle Against Fake Startups (Updated)

Updated (May 1st, 2020)

I wrote this post in 2016. I decided to update and add the information at the bottom of this post today.

Amazon is full of Chinese counterfeits and they’re driving out legit goods

Source: Amazon is full of Chinese counterfeits and they’re driving out legit goods

I know the picture above is not of sneakers, but it relates to something that I noticed happening about a month ago. Currently on Amazon those who own shoe markets who actively pay attention to our stores, have seen an increase in the number of sellers available to sell on Amazon. When I first made it onto Amazon years ago, it took 6 months to get approved. Now anyone can sign up and the sneaker market is beginning to look like the Wild Wild West.

On Amazon you have to “win the Buy Box” to earn a shoe sell or any kind of sell. What this means you have to have the lowest price including shipping for your product to be available to customers with one click. What’s happening and what is explained in the Source link above is Amazon is allowing counterfeit stores to flood the marketplace. These people in many instances are ruining the listings and incorrectly posting the UPC codes and using the wrong pictures.

What this has done to legitimate marketplace stores is a few things:

  1. It destroys customer trust. Customers are getting fake shoes which used to be difficult to pull off on Amazon.
  2. Because customers are getting fake shoes, they think all shoes are fake. The problem is the customer reports the shoes and Amazon pulls the listing down for the shoes. If you bought 20 pair of kicks in that style, unless you have a large following and sell through your site, you’re screwed.
  3. If you’re like me you use the “lowest price” tool picture in (Pic 1) below to adjust your prices to win the buy box. If you don’t use the check price link to see who is selling, you will lower your price and sell your authentic shoe at a price competing with fakes. (See Pic 2).

UPDATED:

I’ve been in the process of sharing information on smaller sneaker companies. This has led to my social feeds being littered with startups and companies that aren’t as well known as other brands. I share the information because as the owner of two different shoe companies, that didn’t make it, I know how hard it is to get coverage on sneaker sites. I also realize how expensive it is to get your brand out there.

What makes me angry is that I can’t reach every consumer to educate them on different companies that exist to take advantage of buyer’s ignorance. As I stated in the information above counterfeits shape the entire market and for smaller brands this can be disruption without the smaller brands even knowing the smaller companies exist. I’m writing this to bring attention to a site that flashed in my feed today. I will write the name of the company, but I won’t create metatags or add the links to improve their search. On a Facebook ad the company Cason has incredible engagement and feedback. The feedback is better than an ad I’ve seen from CLAE and it’s on par with the feedback on Lakai’s ads.

I will share this picture of their sneaker page and explain why I’m writing this:

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In this picture from the Cason website you can several styles, I’m only focusing on sneakers here.

  • Top right is a knock off of the adidas Pharrell Tennis Hu
  • Top middle is a knockoff of the adidas UltraBoost Uncaged
  • Middle left is a knock off of the adidas NMD_XR1 Duck Camo
  • Middle Center is a knock off of a fusion including the adidas 4D midsole, LeBron 15 Low battleknit construction with a Yeezy heel.
  • Bottom middle is a knock off of the New Balance 247 Lux
  • Bottom right is a knock off of the adidas UltraBoost with Y-3 detailing and fake Boost midsole

In the battle that will ensue as we enter the new normal, those of us in the industry understand how bad this is, but the consumer does not. One of the few opportunities that remain in the sneaker industry is customer service and experiential retail. It’s one of the few places an entrepreneur, startup or reemerging company can find differentiation. The problem is you can do everything right, but if you aren’t stopping and educating the consumer, sites like this can and will pull the attention of consumers.

I can’t explain how dangerous this is on every level.

Please, all retailers and brands, make every effort to improve copy and marketing materials. Make every effort to educate the consumer. If you don’t Amazon and the ability for these counterfeit companies to reach the consumer will undoubtedly disrupt and hurt your business.

5 thoughts on “Insider Ties: Amazon, Counterfeits and the Battle Against Fake Startups (Updated)”

  1. People used to come to NYC’s Chinatown, by the bus load, to buy knock offs of brand named merchandise–as far as I know they may still. It really exposed the fact that the brand named stuff is way overpriced; if someone can make a decent transcript and sell it for small fraction of the brand’s retail price.

    I know that was not the point of your article, but maybe this will encourage people to realize their are actually other places to buy things online. It really is worth shopping around. It is not uncommon to find better deals for products off Amazon’s website.

    Won’t it be less expensive for a consumer to buy sneakers from you directly?

    • We had a place like that here in Memphis. People used to come from the Tri States to buy in bulk to resell knock off purses and footwear. The guys would make 10,000 a day on a good day. It was bananas.

      In regard to the customers buying directly from me, this inspired my last video series The Conscious Consumer: https://www.youtube.com/playlist?list=PL_VAAqapCWceCP1MF71zCUF3yXLXPNrmq

      It’s amazing that people simply aren’t willing to look outside of the giant that is Amazon. Amazon controls 51% of all e-commerce transactions online. 51%!!!!! You can’t beat Amazon unless you are starting out and you are willing to sacrifice the amount of money it takes to acquire customers. For a small biz that customer acquisition is greater than the 15% and pain in the ass that Amazon is. I have a video on that as well.

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