Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Mon May 11 2015 16:27:49

Etsy Gets Black Eye over Fakes

By: Ina Steiner

Sponsored Link

Sellers and investors are buzzing after a Wall Street report estimated as many as 2 million items on Etsy could be counterfeit or infringe on trademark. The Wedbush report said that while it expects near-term growth from Etsy, it believes the problem of fakes could have a negative impact on growth.

How? 

The Wedbush report said if brands begin to monitor Etsy for illegitimate sellers, it could "materially reduce" listing and commission fees, according to Forbes.

The analysts cited their own analysis and their discussions with IP lawyers, which "lead us to believe questionable seller practices may draw increased scrutiny, eventually limiting volume growth."

But sellers take a different view about the implications of brand monitoring. While many of those discussing the issue agreed fakes were a problem, they believe more monitoring would be a good thing for the site (and for their sales of legitimate goods) and hoped the attention would result in something being done about the problem. "Maybe search will work once all this stuff is out the door," said one.

And some said cleaning up the site would boost shopper confidence.

The Wedbush report estimated as many as 2 million items on Etsy, or less than 5% of all merchandise, may potentially be either counterfeit or constitute trademark or copyright infringement. 

Sellers discussed the report on the Etsy boards, and debated how big the problem was. "I think the number is much higher than 5%, unfortunately," said one user.

Another seller also questioned the math. "Does the stats taken into account the legitimate uses of names like Mickey Mouse and Louis Vuitton when it is a vintage item. Has that been factored in? If not then the stats used could be false or misleading."

We reached out to Etsy about their policies with regard to counterfeits. Let us know what you think of the problem of fakes on Etsy and on other marketplaces.




Comments (37) | Leave Comment | Permalink

Readers Comments

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: sasikat9 This user has validated their user name.

Mon May 11 17:11:48 2015

Etsy, Ebay, Amazon, Ecrater etc are well versed on how to give lip service to these reports.

The bottom line is always the first consideration when any form of site monitoring is concerned.

To clean up these sites from the scammers, thieves, fakes, etc is a direct impact on the bottom line and these sites JUST AIN'T GOING TO DO IT.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: pace306 This user has validated their user name.

Mon May 11 23:53:17 2015

eBay cleans up fakes when they get threatened or get paid to, Amazon does it to block ASINs for beloveds, no clue what Etsy will or wont do.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

This user has validated their user name. by: askalice59

Tue May 12 00:17:17 2015

How does this work? I ask because I honestly don't know, but let's say a person buys fabric with a  licensed design or artwork by for example Mary Engelbreit and makes a purse out of it. Can they sell the purse? When you buy fabric from the local fabric store have you agreed not to use it to make something for resale? I ask because this is the case with many items on Etsy and all kinds of craft shows.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Deltamaster This user has validated their user name.

Tue May 12 00:19:28 2015

The only time the managed marketplaces deal with fakes... REALLY deal with TRUE fakes is when they are either threatened or when it affects their bottom line or their favored sellers.  Then they take a heavy hand and do NOTHING to truly determine a fake from a true item or an item that is truly allowed to be sold in the secondary market.

As a result, companies such as Monster Cable, Dunkin Donuts and Disney have been able to quash the LEGAL free trade in the secondary market protected by the First Sale Doctrine.  

At the same time NOTHING is done to curb the influx of cheap Chinese knockoffs flowing freely into this country even when they are clearly identified by whistleblowers who spend a great deal of time and resources to point out just how prolific the trade in counterfeit and illegal products are on these marketplaces..

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: odona This user has validated their user name.

Tue May 12 00:19:29 2015

I make a point of reporting fakes (and non vintage items) to etsy and so far they've been pretty good about pulling them down...as a seller I'd love to see one of the companies actually develop a vetting dept - although that can have its own perils as in when people who don't actually know an area of collecting start deciding what's right or wrong

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: WhoKnewIt This user has validated their user name.

Tue May 12 00:19:36 2015

We have been "reporting" and flagging like crazy these very Sellers for YEARS.  Etsy does nothing about it.  Many of these Sellers have 100's of listings....and if they sell?  Well, do the math, Etsy isn't likely to cut off the hand that is feeding them....

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: marcello This user has validated their user name.

Tue May 12 01:31:20 2015

Etsy has always turned a blind eye to copyright infringement and illegal counterfeit merchandise. Etsy Trust and Safety is way too busy harassing vintage sellers to be bothered with that silly nonsense. I can have mass produced tee shirts printed with LV, Chanel and Celine logos and sell them there but don't dare sell a vintage item that they think is a year or two off, they'll shut your store down! This is the hypocrisy of the Etsy marketplace.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: sundance This user has validated their user name.

Tue May 12 01:38:22 2015

Good!  They deserve the black eye.  I had been complaining and flagging obvious bad/illegal sellers for years.  Finally, I had to close up shop.  I sure don't make as much now, but I feel better.  If they ever DO something I may come back.  But not before they make it a more even selling field.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Cloud This user has validated their user name.

Tue May 12 02:46:21 2015

"...may potentially be either counterfeit or constitute trademark or copyright infringement. "

Unless we are talking about vintage items counterfeit items shouldn't be an issue on Etsy, that is if they were actually policing their venue for non handmade items.

As far as copy and trademark infringement, it is rampant. I'd say 8 out of 10 Etsy sellers have at least one item in their store that infringes on someones trademark. I've had items taken down by just by saying "inspired by" where I came up with my own design, and was allowed to relist without the inspired by line, while most others are outright copying a design.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: comet This user has validated their user name.

Tue May 12 02:48:32 2015

From where I sit--selling vintage and used items both high end and middle of the road---ETSY has been on my radar but they really don't seem to have all that much TO offend  over--now I find their SEARCH almost useless so maybe I am just not seeing this.  

If they are likely to shut down a seller of a used "vintage"  1980's Coach bag because the seller believes that it was sold in 1983 vs 1984---and some self appointed Purse Nazi claims it was REALLY sold in 1985---well then maybe they have too much time on their hands.  

If what they are saying is that NEW items are being represented as being MADE BY THE BRAND--and they are NOT-=-well some one is going to have to PROVE this.

How to accomplish this--are we going to be forced to ship ALL of our items off for "Authentication"???   When a seller lists the SAME items--REAL BRAND NAME ITEMS!!!  BUY 'EM HERE!!!---over and over--then most likley these are NOT real.  However neither ETSY nor EBAY seem able to puzzle this out--nor the "Designer inspired"  or simply "designer" key words that jam 'n' spam their sites.  

And SOME of these fakes are really good---I bought --NOT for resale---some "Coach"  charms for stocking stuffers from an import shop in a large  mall here.  We happened to go past the actual Coach display at Macy's and compared these--and even the Coach Rep was impressed--for all we know the SAME Chinese factory is making both.  Knock off charms--that you could not TELL were fakes---sold for something like $5 a pop-=-=vs---$45 and up for the "real"  thing.

EBAY claims they have no fakes--there are millions of fakes in plain sight they just refuse to SEE them--instead warning me that my one off Coach bag from lets say 1977 is==fake.  I don't list hundreds of the SAME brand new designer "Coach"  or "Tiffany"  items--but "I" am the one who gets WARNED and has my items pulled.

Those sellers are --in EBAYS case--their favored CHINESE PARTNERS IN CRIME.  Me?  Just some schlub who shops at thrift stores and church sales to find these gems and present them to a grateful audience==WHEN they can be SEEN.

I am sure there are people like me on ETSY--and they also court these Chinese fake sellers.  That was a VERY deliberate choice ETSY made--and now they are crying "Wolf"!!!  

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Ebay's Slow Death This user has validated their user name.

Tue May 12 03:23:34 2015

How can you sell a newly manufactured, New Coach bag on Etsy anyway? It has to have been made before 1996 to fit into the Vintage category. It wouldn't fit the Handmade or Supplies categories either.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Watching the Wheels This user has validated their user name.

Tue May 12 05:04:14 2015

@Deltamaster, this might be a good time to tip off Wall Street that Etsy allows Alibaba reselling, too.

Etsy will only respond to authority figures that "it" perceives as being too strong to say no, to.

These sites NEVER respect their seller base, so NOW would be the time to strike.

There's some sort of financial report being delivered on the 19th.

Maybe it's time for Etsy to actually do what it says it does.

IF the infringement goods get tossed, and the factory items get tossed, Etsy just might have to figure out how to put together a search, that allows people to find the remaining "proper to Etsy goods".

Just a thought.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: RCL This user has validated their user name.

Tue May 12 07:16:08 2015

I'm with Comet--good distinctions to make.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: RCL This user has validated their user name.

Tue May 12 07:20:55 2015

I CAN say from my own personal, and having heard from other buyers, experience that BOTH eBay and Etsy have a WILDLY successful seller of the very BEST & MOST $$$ costume jewelry (more than one, but one that got me)and despite reports, have done NOTHING to stop the seller of repros as originals. Etsy doesn't know what a fake (or art & collectible for that matter) IS and eBay thinks feedback ratings are a distraction to buyers. In another several years, no one will risk to buy online.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Lois This user has validated their user name.

Tue May 12 07:21:48 2015

There is still another problem that should alarm ETSY stockholders, and that is the issue of not requiring that sellers of home-prepared foods - cakes, cookies, candies, jams, pickles  and so on - are not required to have a legally-approved preparation facility.

I have brought this to their attention, and the concern has been totally ignored.

If I were a stockholder, I would be very concerned about the legal liability of ETSY in a law suit of someone gets sick, or even worse, dies because of improperly, non-inspected food items purchased on ETSY. This is especially troublesome given the influx of sellers from third-world countries where sanitation is not a priority.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Flying Childers This user has validated their user name.

Tue May 12 08:10:32 2015

Great comments from some very astute sellers. It is always such a pleasure to read this blog!

As far as the latest Etsy debacle, let's have a reality check. The theory of Etsy is supposed to be that you can sell 3 types of merchandise, handmade, vintage and supplies.

There has been the biggest change of definition in handmade and vintage, especially since 2013 when Chad decided to change the definition of "handmade" in order to legitimize the hordes of Chinese re-sellers who seem to have such a huge presence on the site.
The same thing has happened with "vintage" items that are brand new things, especially in jewelry, that might have a "vintage" look to them.

What really gets me is how Chad & Co. have completely debased the language in order to allow substandard merchandise that generates a lot of money for them while screwing their loyal and legitimate customers.

I wish the fascist admins who police the forums like it's North Korea would spend as much time weeding out the fakes as they do looking for negative comments about Etsy!

I am really glad to hear that we are being vindicated and truly hope that Chad & Co. will be forced to clean up their act before they destroy what was once a great marketplace for handmade and vintage sellers.

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: Ebay Seller-Ebay Buyer This user has validated their user name.

Tue May 12 08:22:56 2015

It sounds like Etsy is cutting into Ebay's market share and Ebay has paid off some analysts to try to bring Etsy down

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: SammyCat This user has validated their user name.

Tue May 12 09:49:26 2015

I had a few 1930's and 1940's alligator purses in my shop.  I got an email saying that these items were not allowed and that Etsy had pulled the listings.

I did a search and there were over 1500 searches related to alligator handbag, alligator purse.

Fired off an email saying ... what about these and why my two purses out of a sea of similar items using the same material.

They didn't tell me but I know that it was another shop, most likely selling what I was who reported me to get rid of my merchandise.

Its a slippery slop, but reporting really is the only way to go when you find fakes or pieces that infringe on trademark (which has not been clearly defined!)

You can sell an authentic vintage Chanel anything, but you can't claim that something is Chanel just because it looks like it to get more views etc.  

It is trademark infringement but it is also keyword spamming which should concern us all. They tricks to divert track is rampant and Etsy doesn't do anything about that either.  

Yes their search sucks, but it doesn't help that people are allowed to abuse words, terms etc to position themselves higher, attract unwitting buyers, and steal traffic from authentic pieces and the shops that sell them.  

Its a tricky business and Etsy has enough bloody profit to higher more staff to ensure quality control etc.  New shops should have to submit 10 mock listings for someone to go through so they can decide if the shop is up to par in terms of quality of product, photography etc.  JMHO

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

by: FREDDY This user has validated their user name.

Tue May 12 09:51:47 2015

@Ebay Seller-Ebay Buyer

Companies have been doing this for a long long time.
You are probably right in this case. Maybe ebay actually started losing chinese sales to Etsy...

Perminate Link for Etsy Gets Black Eye over Fakes   Etsy Gets Black Eye over Fakes

This user has validated their user name. by: The End

Tue May 12 10:13:10 2015

Thank Heavens my product is So Unique, no one Dares to copy it.
Another reason to keep the price low as well.
We need a new set of laws to deal with this problem of bootleggers.
Stiff prison sentences (build more prisons) for these foreign and domestic economic terrorists.

Click to view more comments
1 2  [Next Page]


Login is required to post comments.
To sign in to leave a comment using your AB Verify User Name, fill in the form below. If you have not yet signed up for AB Verify, or if you'd like more information, go to the Registration Page
.

Login for AB Verify
Be sure and use your email address and password to log in.

 
Email:
Password:
 
 Forgot Your Password?
 Even though you are signed in with the AuctionBytes Blog, you will have to sign in to the EcommerceBytes blog. But you can sign in with your existing AB Verify info.