Kering SA , the owner of high-end brands such as Gucci and Yves St Laurent to name a few, is suing Alibaba, the recently listed Chinese e-commerce behemoth for allowing counterfeiters to trade knocks offs on Alibaba’s selling platforms.
The accusation goes further, “that Alibaba had conspired to manufacture, offer for sale and traffic in counterfeit products bearing their trademarks without their permission” as reported by Reuters this week. Alibaba execs vehemently deny any wrongdoing and are determined to fight this allegation.
Alibaba Group Holdings provides a platform that allows merchants to advertise and trade their merchandise and then facilitates the transaction between buyer and seller, acting as the middle man. Taobao is Alibaba’s biggest website, containing over 700 million products from 7 million merchants, a flea market for the small guy to sell his stuff.
With these types of numbers, one can understand how unscrupulous behaviour can slip through the cracks. The burning questions is, if Alibaba and its tentacles want to be successful in the west as they have been in China they will have to control their dealers, but is this possible?
In January 2015, the Chinese regulatory division, The State Administration for Industry & Commerce, accused the company of not paying enough attention to the removal of fake goods from its websites, an accusation that Alibaba rebuffed by bringing into question the procedure the agency used in coming to its conclusion.
The company is quick to point to the $160 million it spent between 2013 and 2014 to weed out counterfeit goods as well their co-operation with authorities in more than 1000 cases against bootleggers.
One thousand cases amongst 7 million merchants, doesn’t really bear testament to an overwhelming effort. For a company that seems to be ahead of the curve in the e-commerce industry, it is quite questionable as to why they have failed to deal with the problem on a technological front.
Taobao was removed from the United States Trade Representatives “Notorious Markets List” in 2012 in recognition of efforts made to address piracy concerns, with promises made from Alibaba that the work will continue. This latest blip may take the company a step back in gaining confidence in its new territory.
- I have travelled the full spectrum of what technology has to offer. The creature that is my career continued its evolution into the Project Management environment, managing major software development for some major players, right up to implementation, roll out and even training. Changing little, but changing often is my strategy for progress.