There is no question how important a good customer relationship is. But the ways in which customer relationships and a brand built with passion can be protected have so far been rather vague. That's over now! Proactively protect your brand from counterfeiting with Amazon Transparency!
Why does the Amazon Transparency Program exist?
Transparency protects your brand and customers by ensuring that every unit is genuine. But why is this necessary? What role do counterfeit goods play?
Looking at the world as a whole, over 400 billion euros in counterfeit products were traded in 2019. That's 2.5 % of global trade! And in the EU? In the same year, it was 119 billion euros, or 5.8 %! (Source: EUIPO)
In 2020, Amazon had to destroy no less than two million counterfeit products after they were found in its warehouses. But that's not all: a further ten billion products had to be blocked or were directly denied inclusion in the product range.
This even creates jobs, as Amazon now employs around 10,000 people to prevent fraud. However, artificial intelligence is now primarily used in this area, with the primary aim of banning counterfeit items from the market.
Amazon's Transparency Program was created with this goal in mind. 15,000 brand manufacturers were already part of it in 2021 and were able to benefit from the associated advantages. (Source: Handelsblatt)
According to sources, counterfeit goods seem to be a problem worldwide and also in the EU, but what about Germany? The German customs report from 2021 has the answers: 18 million items had to be confiscated in 2021 alone. These goods were worth a whopping 315 million euros. This means that the number of confiscated goods tripled between 2019 and 2021 and their value increased by 40 % in the same period. Incidentally, half of these products came from China. (Source: Federal Ministry of Finance)
Product piracy and counterfeit goods are therefore a serious problem, and not just in relation to the world or the EU, but also explicitly in Germany. The figures also make it clear that counterfeit goods and product piracy represent an enormous cost item.
But what is Amazon's solution to this well-known problem? What exactly is Amazon's Transparency Program and how can it be used? Answers to these and other questions follow.
Amazon's response to product piracy and counterfeit goods
The Transparency program focuses on brand protection. This means that mainly companies that have registered their brands with Amazon (more precisely: Amazon Brand Registry) receive support.
And no, this does not only affect others, because in principle any brand owner or manufacturer can become a victim of product piracy. The resulting damage is difficult to estimate and in most cases it is not obvious to entrepreneurs whether and, if so, to what extent they have fallen victim to product piracy.
In large companies, an entire department often already deals with the issue of product piracy. What is already on the agenda for large companies is often unthinkable and uneconomical for smaller companies. However, the Amazon Transparency Program can offer new opportunities to combat counterfeit goods, especially for companies that do not have their own legal department but have registered their own brands with Amazon.
Apart from the pure economic damage, this topic also focuses on reviews and ratings. It can happen that a company receives false negative reviews because its customers have had to deal with counterfeit products. However, the customer does not notice the difference, which results in further economic damage for the company.
A tip in passing on the subject of customer reviews: In this context, the question often arises as to how purchased product reviews can actually be recognized. We will get to the bottom of questions relating to this topic in another article.
Amazon Transparency is currently (2022) available in the following countries:
- United Kingdom
- United States of America
Only customers from the countries mentioned can currently use the program.
Transparency QR code from Amazon - what does the seal of approval look like?
Amazon's solution is a seal of approval. FBA sellers (FBA = Fulfillment by Amazon) are given access to this. Brand owners or manufacturers are assigned an ASIN (Amazon Standard Identification Number, consisting of 10 characters) in addition to the seal of approval. Each seal has a unique QR code and therefore each product has its own unique ID. Copying the seal of approval therefore makes no sense, as the system would detect the duplication.
This also means that every product approved for Amazon Transparency needs its own sticker with a QR code. This is called the "Transparency 2D barcode". It is clearly visible on each product unit, i.e. stuck to the outermost packaging. The special Transparency symbol makes this sticker unmistakable.
As a seller, you can choose between three different label designs. The labels differ in details, but all labels have a repeating pattern. The QR code is located behind the T symbol. The Amazon Transparency symbol is usually blue. If the standard version is selected, the square QR code is black and white. The QR code stickers are called labels according to the current name of Amazon.
The QR codes (labels) are currently available in three different sizes:
- Label 1 - Size: 2.8 x 2.8 cm
- Label 2 - Size: 4.5 x 2.0 cm
- Label 3 - Size: 3.5 x 3.5 cm
The Transparency Code is an alphanumeric value. It either has 26 digits (and follows the prefix AZ/ ZA separated by a colon) or it is a 38-digit SGTIN.
Show results with Transparency
Transparency uses secure, unique codes to identify individual units and prevent counterfeits from reaching the customer. On the one hand, this improves customer loyalty and, on the other, brands can gain valuable insights that can help optimize the supply chain.
- Authenticity check for a product: Ensure that only genuine products are sent to your customers. Valid transparency codes are used for this and it does not matter whether the "Shipping by Amazon" option is used or whether the shipment is handled directly by a sales partner.
- Interact with customers: The customer can use the Amazon shopping app or the Transparency app after purchase to scan the codes that confirm authenticity, submit reviews and access any content you may have provided. All this is possible regardless of where they bought your product.
- Optimize your supply chain: You can gain additional information about your items at batch or lot level. This allows you to identify and solve supply chain or other problems and find the source of product improvements. All of this has minimal impact on your business operations.
Why use Amazon Transparency?
After a brief insight into how the Amazon Transparency program works, let's take another look at your benefits with the program.
If another seller tries to sell your items, Amazon will recognize this because the counterfeiter is not using valid transparency codes. Accordingly, Amazon interrupts the supply chain and the counterfeit does not reach the customer. This protects your brand and customers stay with you, the genuine seller.
If a counterfeit item reaches the customer, it is usually of poor quality, which not only has a negative impact on the service life of a product, but can also pose a risk of injury to the customer. On the one hand, this can damage your reputation and on the other hand, it can lead to the customer having to replace the broken product or, in the worst case, sustaining an injury. Transparency codes, on the other hand, create trust and thus stable customer loyalty.
Negative shopping experiences result in poor customer reviews. By using transparency codes, on the other hand, you can ensure a positive shopping experience that customers are happy to reward with a positive review or rating.
Conclusion on Amazon Transparency
Amazon Transparency is a major step forward in the fight against product piracy and counterfeit goods. The approach is both proactive and preventative. If you have any questions about Amazon Transparency, make an appointment today with the Amazon agency AdsMasters.