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.
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.