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BizReport : Ecommerce : April 06, 2020

Expert: How to outwit scammers feeding on COVID-19 fears

Scammers selling fake products on the Internet, pretending to be authentic designers and brands, has long been a problem. But over the past few weeks, a new crop of these scammers have put their shingles up all over the web, and they're selling products that have gotten more interest since the COVID-19 pandemic hit mainstream news channels. Here's how brands can protect their identities - and their consumers - against these fraudsters.

by Kristina Knight

Kristina: We hear a lot about fake-designer handbags or shoes - this is the first we're hearing about fake health goods like hand sanitizer - have these fakes been around for a while? 

Piers Barclay, Chief Strategy Officer, Incopro: The emergence of fake versions of hand sanitizer and antibacterial wipes is an entirely new problem driven by COVID-19 that demonstrates how agile but unethical counterfeiters are. Even as recently as before Christmas we were not seeing these kind of products being counterfeited. Counterfeiters are very agile and commercially-minded. They don't have to go through regulatory approvals like legitimate manufacturers, so they can bring products (that are likely to be ineffective) to the market very quickly when they see spikes in demand.

More broadly in the health space, fake pharmaceuticals have been a problem for some time. Yet the current situation of constrained legitimate supply and increased demand has led to surges in counterfeiting often tied to major news updates, which also highlights how rapidly counterfeiters react to increased demand without concern for the consequences of what they are doing. 

Kristina: Your new report shows a more than 200% uptick in listings for non-genuine hand sanitizers, antibacterial wipes and the like. What tactics are these counterfeiters using to get their products onto selling sites and into consumers' hands?

Piers: Whilst some e-commerce marketplaces have taken proactive action to remove listings that make claims about COVID-19, counterfeiters have reacted to evade these automatic checks on listing text by either not mentioning search terms like "coronavirus" or by embedding these terms within an image that the platform isn't proactively monitoring. However, the counterfeiters don't just rely on other platforms - they have sophisticated go-to-market strategies that leverage social media and search in order to attract consumers to websites they set up themselves, as well as using retargeting ads. This has been a key strategy for sellers of products related to COVID-19. 

Kristina: Is there anything brands can to do protect themselves against counterfeit goods? 

Piers: Many of the brands affected by these issues won't have had significant issues with fakes before, and so probably take a reactive approach, such as sending letters to platforms when someone in their business notices an issue. Instead, they need to take a proactive approach for monitoring key platforms, focus on identifying the commercial scale operators, and leverage platform policies to have these removed simultaneously. Playing whack-a-mole and trying to take things down on a listing by listing basis can be time consuming and ineffective, so focusing on the commercial networks is important. 

Kristina: What about selling platforms - what actions can they take against those who try to sell counterfeit goods? 

Piers: It's been good to see platforms make an effort to be proactive in removing misleading content related to the coronavirus pandemic. Ultimately, they need to act rapidly to remove the threats to consumers, and that requires taking more of a common sense approach when notified about this kind of activity, rather than prioritizing the value they make from transactions and avoiding removing obvious issues. 

Kristina: From a consumer standpoint, what should buyers look for to ensure they're getting real products and not imitation?  

Piers: There are a few red flags to keep in mind.  For example, don't buy just on price - if a price is too good to be true, it probably is.  Another is read the reviews (if available) for a listing before buying, but be aware that some reviews may be fraudulent. If a handful of 5* reviews are mixed in with largely negative reviews, the review has probably been paid for by the faker.  Also, check the country of origin - 72% of the counterfeit goods currently in circulation in the world's largest markets for products, such as the U.S., E.U., and Japan, are thought to be exported from China (Europol/ EUIPO), so vet these listings carefully.  

Tags: advertising, ecommerce, ecommerce tips, fake products, Incopro, merchant tips, mobile commerce, mobile marketing, retail tips, social commerce, social marketing

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