Amazon Transparency Program
What is Amazon’s Transparency program – Proactive counterfeit protection?
Chinese counterfeits are prevalent on Amazon.com. Amazon’s Marketplace business model where multiple sellers can sell same product and compete on price creates an opportunity for counterfeit sellers to list their products on the same listing as the genuine product. Even though Amazon has launched the Brand Registry program, it is only partially effective. This program prevents counterfeit products from attaching to your listing.
The Amazon Transparency program is designed for Brand Manufacturers who want to reduce the damage done to their business by counterfeiters on Amazon. The Amazon Transparency is a brand-new program (still in Beta) and it is designed to block counterfeits from hijacking your listing. It, however, does not solve the problem caused by new listings created by the counterfeiters. This program is only available in the US at this time and will be expanded to additional Global Amazon Marketplaces in 2019.
Who are Hijackers? Hijackers are the people on your listing that have undercut your price just enough to steal the Buy Box from you.
What is a Buy Box? Amazon Buy Box is a box on the product detail page where customers begin the purchasing process. Usually, a single product is offered by multiple sellers and these sellers compete to be in the Buy Box. Amazon selects one seller among the eligible sellers and grants them the Buy Box.
Basically, Amazon is asking the brand manufacturers to label every single product with a unique two-dimensional bar code (Unique Identifier Label). The barcode is based on a 26-digit non-sequential alphanumeric code provided to the manufacturer by Amazon. The manufacturer requests number of codes to Amazon based on the quantity being manufactured for a specific product (ASIN). Amazon provides an Excel file with unique codes for all the units that are being manufactured. Amazon has partnered with a few printers who can convert the alphanumeric code into a two-dimensional bar code – sort of like a QR code.
One of the requirements is that the brand manufacturer labels all the units of the product even if only a subset is sent to Amazon. This is done because under the First Sale Doctrine anyone who bought the product at retail or other sources has rights to sell it.
If you are using Fulfillment by Amazon (FBA), once the products are labeled, the Brand can send inventory to Amazon. Amazon will inspect the incoming inventory and scan the labels to verify that the codes match the Amazon’s database. Amazon checks the labels and codes to make sure you have followed their instructions. Once you pass this test, Amazon enables the Transparency program for your product. This means no counterfeits can be listed on your listing. This virtually guarantees close to 100% Buybox.
What about sellers shipping product from their own warehouse? If counterfeits try to list the product on your listing, Amazon will ask them to provide the scans of Transparency labels.
Here is the process as shared by Amazon.
The Transparency App for consumers
In addition, Amazon has launched an App called Transparency for mobile devices. Using this App, consumers can scan the code on the product to verify that the product is genuine. In addition, the transparency App also provides information about the product, manufacturing date and location.
When a transparency label is scanned with the App, here is what the consumer sees. The product is authenticated and additional information about the product is displayed including the manufacturing location, date and 26-digit alphanumeric code.
Can someone copy the codes?
The only way to cheat the system is to obtain the file with codes or printed labels. As long as you manage the process carefully, there is no way to copy and use these labels.
Amazon Transparency program is a bulletproof way for preventing counterfeits from hijacking your listing. It, however, does not prevent damage done by sellers creating new listings and shipping counterfeits.
Gaining near 100% Buy Box can easily double your sales on Amazon. It also allows you to maintain your price on Amazon and protect your business in other channels such as retail.