INTRODUCTION: If you’re a manufacturer or brand owner, an unauthorized reseller on Amazon is any third-party retailer who has no official relationship with your company — and no right to buy your products to reseller them to customers — but who nevertheless sets up sales pages on Amazon advertising your products.
What’s particularly problematic about this is that Amazon is well known for often choosing to remain neutral in manufacturer-retailer disputes.
Amazon might quickly remove a retailer’s listing from its marketplace if the manufacturer can prove the retailer has committed a crime — such as illegally using the manufacturer’s intellectual property (trademarks, brand name, etc.). But Amazon will in most cases refuse to take any action if that retailer is simply listing products below the manufacturer’s MAP pricing policy. Amazon’s seller team often tells manufacturers that it does not get involved directly in pricing disputes between brand owners and retailers on its site.
How Unauthorized Resellers on Amazon Operate
Rogue retailers employ all sorts of tricks to sell products on Amazon without the permission of the manufacturers or brand owners of those products. Here are a couple of the more common examples.
- Using phony ASINs to avoid detection by the manufacturer.
Imagine a retailer who isn’t part of your Authorized Dealer Network and has no official relationship with your company, but who still wants to make money selling your products on Amazon. One trick they’ll employ is to create fake ASINs (Amazon Standard Identification Numbers) for each of your products they want to list.
With this trick, they can place their sales pages on Amazon and your company (or even your price tracking software, if you’re using one that isn’t great) might not catch it — because while you’re scanning the marketplace for your ASINs, they’re selling your products on Amazon in broad daylight because they’ve made up their own ASIN.
- Tweaking your products’ details on their sales pages, to lure customers from competitors also selling your products.
Unauthorized resellers of your products on Amazon know the sales listings they’re creating on the marketplace will be going up against competitors (your authorized resellers, in most cases) who are selling the exact same products.
So they will sometimes intentionally add inaccurate, exaggerated product specs and other details to their sales listing pages to lure customers away from their competitors.
For example, they might add an untrue statement about your product in the features section. They might use an inaccurate (but impressive!) photo to imply the product has characteristics it actually doesn’t. They might try all sorts of tricks to give a shopper a false impression of your product — so the customer buys from that reseller instead of all of the others on Amazon offering the product.
The problem, of course, is that this trick — and the many others that unauthorized resellers of your products on Amazon use — will likely lead to customer anger, public distrust and, eventually, an erosion of your brand’s value.
Bottom line: To effectively protect both your honorable retail partners and your brand value from rotten reseller tricks like these, you need to know that there might be unauthorized retailers on Amazon (and on other marketplaces) using them against your company at any time, and how to deal with them effectively.
5 Options for Handling Unauthorized Resellers Selling Your Products on Amazon
- Ignore the violations.
Many manufacturers take the head-in-the-sand approach when they spot an unauthorized reseller violating one or more of their guidelines on Amazon. There are several reasons for this.
In some cases, the manufacturer has tried dealing with the rogue retailer directly and had no luck stopping the behavior. Perhaps they sent a warning letter and the retailer simply ignored it and continued with its unauthorized sales listings. And the manufacturer doesn’t know what else to do.
In other cases, the manufacturer has taken its case to Amazon. But if Amazon determined that the retailer wasn’t breaking intellectual property laws, they might have told the manufacturer there wasn’t much they could do. So that manufacturer might have concluded they simply had no resource if they ever again spotted a MAP pricing policy violation on Amazon.
Finally, in some cases an employee of the manufacturer’s company might have noticed a violation on Amazon and simply chosen not to address it because he didn’t know what to do.
But of course, ignoring reseller policy violations, on Amazon or anywhere else, is the worst possible approach—because it can quickly lead to additional violations, a price war, furious partners in your authorized resale network, and eventually harm to your brand value.
- Complain to Amazon.
This strategy can be worth trying — but it’s important to keep in mind that Amazon tends to take a hands-off approach in disputes between brand owners and retailers involving such issues as violations of company pricing or brand guidelines.
As we stated above, however, there is one major exception to this trend: Amazon will step in and help remove a rogue reseller’s listing if they determine that the sales page contains copyright or intellectual property infringements. The marketplace does not want to be a party to any illegal activity, and hosting content online that is proven to violate the law could put Amazon itself in legal jeopardy.
The good news here — if you can think of any of this as good news — is that if you’re dealing with an unauthorized retailer selling your products on Amazon, you might be in a better position to make a case that the company is violating your intellectual property. If they have copied and pasted your company’s sales copy, for example, and if they are using your brand’s logo or taglines or any registered or trademarked material, you might be able to appeal to Amazon that they are in fact violating your intellectual property rights.
But if your real issue with this retailer isn’t that they are using your copyrighted material, but rather that they are offering your products on Amazon below your MAP-approved price levels, or that they aren’t part of your Authorized Dealer Network, you might need to look to someone other than Amazon for help.
- Sign up for Amazon Brand Registry.
A more practical option to prevent (or at least cut down on) unauthorized resellers offering your products on Amazon is to establish your company or a trusted resale partner as the official “brand owner” on Amazon — by signing up for Amazon Brand Registry.
You can find the details and benefits of Amazon Brand Registry here. For our discussion here about rogue retailers, just understand that by establishing yourself as brand owner on Amazon, you will enjoy additional protections for your brand across the marketplace — including greater barriers to stop rogue retailers from create unauthorized sales listings and enhanced monitoring and enforcement tools on the Amazon platform itself to give you a better chance of spotting even the more sophisticated rogue retailers.
- Apply to become a Restricted Brand on Amazon.
Unless your company is trying to prevent counterfeiters from selling phony versions of your products on Amazon, this might be too aggressive an approach to dealing with unauthorized resellers.
Amazon’s Restricted Brand status puts your brand (or specific products) on a list that limits which resellers can offer those products on Amazon’s marketplace. Brands on this list are typically those in categories most vulnerable to counterfeiting — such as luxury apparel brands, high-end handbags, and many types of consumer electronics. Getting onto this Restricted Brand list requires effort, though, including an application to Amazon
And if Amazon accepts your brand onto its Restricted Brand list, they will be much more aggressive in preventing sellers from creating sales listings of your products on Amazon (other than those retail partners you specifically allow).
The downside of this approach is that for many manufacturers it will go too far in other direction — making it more difficult for the manufacturer’s retail channel to sell its products through Amazon.
Sellers often complain that Amazon prevents them from listing certain products on the marketplace even though they are members in good standing of the manufacturer’s Authorized Dealer Network.
So unless you are concerned about counterfeiters on Amazon luring your customers away with knockoffs of your products, you might want to stay away from the Restricted Brand approach.
- Set up an automated brand protection platform that can help deal with unauthorized resellers on Amazon.
Finally, one of the most practical and cost-effective options is to deploy a price tracking and brand protection solution backed by a team of experts who can also help you specifically address rogue retailers on Amazon.
This type of software application will monitor your brand’s presence across Amazon (as well as the entire Internet) 24/7/365, and will help you to take action against unauthorized resellers who are hijacking sales from your authorized retail partners on the platform.