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Amazon faces a $33,000 penalty over counterfeiting allegations

Happy first day of spring! 🌸

Like flowers going into full bloom, there’ll come a time when Amazon sellers will eventually reap the fruits (or flowers) of their hard work.

But when one works hard, someone else is cheating their way to cut the system. Whether it’s a good or bad practice, nothing remains hidden forever—just like the hot news we’ll serve today:

BLACK MARKET

Yup, you heard that right. Amazon and a clothing manufacturer named V K Knitting Industries are on the other side of a counterfeiting battle after the Chandigarh Consumer Disputes Redressal Commission penalized them for selling counterfeit goods

🤦In a report by The Indian Express, a customer ordered a pair of Marc Jacobs socks at a steal, only to unwrap a disappointing surprise. Here’s what happened:

  • Jatin Bansal, a local from Chandigarh, thought he scored a deal of the century when he snagged a pair of 'Marc Jacobs' socks on Amazon for Rs 279.30 (less than $4).
  • But when the item was delivered, he was shocked to receive a knockoff by the name of 'Marc,’ courtesy of V K Knitting Industries. 
  • What’s even worse—there’s no return policy in sight!

🧑‍⚖️ The verdict

The Commission wasn’t having any of it, demanding Amazon to stop displaying the same product on its platform as “Marc Jacobs.”. They also imposed a penalty of Rs 27 lakh, equivalent to almost $33,000 on the retail giant and V K Knitting Industries. 

Here's the penalty breakdown:

  • Full refund for customer = Rs 279.30 (roughly $3.37)
    Compensation for customers' troubles = Rs 2 lakh ($2412.16)
  • Litigation costs = Rs 20,000 ($241.22)
  • Legal aid account payment = Rs 25 lakh ($30,151.90)

Amazon tried to wiggle out, citing jurisdictional gymnastics and platform policy. But the Commission firmly stood by its decision and reminded Amazon that when it comes to dodgy products, refunds should be as easy as slipping off a sock.

In case you’re wondering, V K Knitting Industries wasn’t innocent either. They knew Amazon was peddling their socks under false pretenses but didn’t lift a finger to stop it. 🚩

What happens next?

The commission sent a stern letter to the authorities in New Delhi. So, it seems this might have larger implications for Amazon.

📌Gentle reminders for sellers: Maintain your integrity. It's best to sell in the most honest manner possible. The consequences of doing otherwise might not just break the bank but also your entire business.

TOGETHER WITH WALMART MARKETPLACE

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*Source: Walmart first-party data, 2021-22

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BITES OF THE WEEK

ECOMMERCE NEWS

Walmart is Amazon’s only competitor

Walmart is Amazon’s only competitor

As Amazon remains the biggest, baddest online marketplace in the U.S., rival platforms continue to try harder to overtake it. But according to Marketplace Pulse, Walmart is Amazon’s only real competitor.

How so? Well, here’s the breakdown of the ecommerce battle so far:

  • eBay remains the 3rd largest online marketplace—but spending was up by only 7%. Also, it mainly focuses on enthusiasts and collectors rather than direct shoppers.
  • Target is growing well—but its marketplace has less than 1,000 sellers. 
  • Shopify surpassed $200 billion in annualized GMV in 2023—but its mobile app “Shop” is doing less than $1 billion annually.
  • Newbies Temu, Shein, and TikTok Shop did disrupt online retail—but they still have a way to go in terms of being the top marketplace

🥊 What sets Walmart apart?

Compared with the ecommerce platforms above, it:

  • Has more than 100,000 active sellers.
  • Pools in $100 billion in online sales, in the same order and magnitude as Amazon.
  • Has been growing faster than Amazon in the past 5 years.

But Walmart’s biggest green flag is its quick adoption of optimal fulfillment, marketplace, and advertising tactics—at least compared to other platforms.

For now, only time will tell how far they’ll catch up. While keeping an eye out on how this battle will unfold, why not devise your own optimal way to sell on both platforms?

TACTIC TALKS

5 foolproof content marketing ideas to try in April 2024

5 foolproof content marketing ideas to try in April 2024

When it comes to marketing your products, content is king. But if you’re feeling stuck with your content calendar, don’t worry because Practical Ecommerce has some awesome ideas to jazz up your content game this April:

  • Connect activities to your products. Tap into your customers’ interests by sharing exciting activities related to your products. For instance, you could write about the top 10 hiking trails for Spring and feature your best-selling hiking boots or backpacks within the content.
  • National Welding Month. Talk about trends, gears, or even career opportunities in welding in your newsletter or social media to reach the handy ones out there. If you’re selling welding equipment or protective gear, you can consider promoting them in these articles too! 🥽
  • National Car Care Month. Share car stories and interviews or pair cars with car-related products like car cleaning kits, dashboard accessories, and apparel for car lovers. Don’t forget to add links to the products available in your store.
  • National Burrito Day (first Thursday in April).Spice up your content by including recipes, fun facts, or quirky burrito-themed ideas in your articles. For example, if you’re selling luggage, you can link your products in your article about the best places to visit for burrito lovers.
  • National Handmade Day (first Saturday in April).Showcase handmade products or DIY projects that align with your brand's niche or target audience. Provide step-by-step tutorials or inspirational ideas for creating handmade items, and include links to crafting supplies or tools available in your store. 🎨

📈 Do you have other ideas to drive engagement and boost your sales this April? Do share them with us by replying to this email!

Author : SellerBites
Faith began working on SellerBites in 2021, a weekly newsletter that provides sellers with the latest news and updates in FBA. With first-hand experience in managing various seller and vendor accounts, she understands what sellers face on this platform. Her background led to the conception of SellerBites, which main goal is to help people become better, more informed entrepreneurs in the Amazon marketplace.
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