In 2017, Amazon launched a program called the Transparency Program. It was designed to help brand owners protect their retail businesses from unauthorized sellers and counterfeit products.
The program also ensures that only authentic products are sold on the Amazon platform. Before we get down to the nitty gritty, let’s start with why Amazon wanted to create this program in the first place.
Why is There a Need for the Transparency Program?
The way Amazon works is by mixing third-party sellers’ products with products that come directly from manufacturers. This works just fine in most cases due to the first sale doctrine. This legal concept allows third-party sellers to sell products they’ve purchased that are trademarked or copyrighted, without any penalty. It’s a business model that many ecommerce sellers have used to get started in the industry.
The problem with this option is that it makes it very easy for dishonest and fraudulent manufacturers to make cheap copies of genuine products and sell them. Amazon has so many SKUs that it’s exceedingly difficult to monitor them for counterfeit products.
Over the last several years, there’ve been media reports of a counterfeit problem on Amazon. Unfortunately, it’s happening with enough regularity that Amazon is having a hard time controlling it.
That’s why the Transparency program was created.
What Exactly is the Transparency Program?
The Transparency program has been around since 2017, but Amazon has been enrolling brands slowly so they could work out any kinks along the way. The program’s goal is to ensure that only legitimate products are being sold on Amazon.
How Does Amazon’s Transparency Program Work?
After a brand owner is enrolled in the transparency program, they then purchase unique codes for the products they sell on Amazon. Essentially, the brand owner will then create barcode labels using the individually unique identifiers and apply those labels on each product. Each item has its own unique label.
The products are then shipped to shoppers, who verify the authenticity of the items they purchased. Not only can they check the authenticity of the item, they can check more information about their item through the Transparency app, available for both Android and iPhone devices.
Brands using the Transparency program can now control how their products are sold on Amazon and prevent counterfeiters. Additionally, the overall buying experience for shoppers improves because they now have more trust in the products they’re purchasing and the brand they’re buying from.
What are the Amazon Transparency Requirements?
There are some requirements that must be met for brands to participate in the Transparency program. Products must:
- Be trademarked (principal register, not secondary)
- Have UPC codes/GTIN(can be purchased quickly from GS1, but it can be costly)
- Be able to have stickers applied or package design that meet Amazon Transparency program specifications
The brand itself must:
- Be registered with Amazon Brand Registry
- Be registered with the Transparency program
- Meet quality control and other requirements
Sellers who haven’t had to deal with these requirements before may find these steps to be time-consuming and expensive. For those who are already selling trademarked products with UPC codes, it’s a fairly simple process to complete.
Once brand owners get into the Amazon Transparency program, they can have confidence that counterfeiters won’t steal their customers.
What Does the Future Hold for Amazon’s Transparency Program?
The Transparency program is a huge step in the right direction for Amazon. This program gives them the ability to monitor and prevent counterfeiting, but it will be more effective once more brands are using it.
That is something that Amazon plans to do, but it may prove challenging. Both buyers and sellers stand to really benefit from the prevention of counterfeiters selling fake products. However, it would require that major retailers to jump on board – which may be unlikely because Amazon is their competition.