As we head into the biggest shopping period of the year — which this year may well have an even stronger online component than usual because of COVID-19 — Amazon has launched its latest effort to combat the sale of counterfeit goods on its site.
The e-commerce giant today announced that its IP Accelerator is now live in Europe — specifically France, Germany, Italy, Spain, Netherlands and the United Kingdom — to help SMBs selling on Amazon obtain trademarks on their intellectual property, protect their brands and tackle the sale of counterfeit goods, connecting companies with recommended legal firms to carry out work. Joining the IP Accelerator is free, while the legal aid is provided as “low-cost assistance”, with those costs coming in the form of “competitive, pre-negotiated rates,” Amazon said.
The European launch — in Amazon’s six biggest markets in Europe, covering more than 150,000 small and medium businesses selling on Amazon’s platform, which account for more than half the products sold in the region — comes just over a year after Amazon kicked off an IP Accelerator in the U.S., in October 2019.
Amazon today said that the U.S. effort has so far yielded 6,000 trademark applications submitted to the U.S. Patent and Trademark Office by SMBs working through the program.
Amazon has long struggled with counterfeit and other illicit items sold through its marketplace — which brings in third-party sellers and is built on the very concept of economies of scale, offering a vast array of choices to shoppers, and the IP Accelerator comes on the heels of a lot of other proactive efforts to battle the situation.
They have included Amazon filing a number of lawsuits — both on its own and in partnership with others, and most recently, just this month, being the plaintiff in a case that interestingly extended outside its own platform to target online influencers.
It also has built a lot of technology to help track and spot illicit goods.
And it’s working with government authorities, most recently in an initiative to halt the import of counterfeit inventory before it gets sold or delivered to buyers.
It’s a Sisyphean task in some regards: Amazon’s growth means more sellers, and more goods to triage, and more chances for dodgy items. But it’s one that is very much in Amazon’s interest to get right: If it can’t protect IP, the best brands will stay away, and consumers will start to lose confidence in the platform, too.
That’s where initiatives like the IP Accelerator come in, where the idea is that it gives sellers who are smaller more direct control over their own brand destinies.
The focus on SMBs is very specific and not just because of their collective selling power on Amazon. They are most often not in full possession of their legal options, and perhaps also worried about the costs of getting involved in trademarking, with a recent report from the European Intellectual Property Office finding that just 9% of SMBs have registered IP rights, versus 36% of larger companies.
“We know from our conversations with small business owners that there is often confusion about why IP rights are important and how sellers can secure them,” said Francois Saugier, vice president for EU Seller Services, Amazon, in a statement. “As part of our broader commitment to supporting small businesses, we have set up IP Accelerator to make the IP registration process as easy and as affordable as possible for entrepreneurs in the early days of their businesses.”
In addition to legal assistance, SMBs in the program can then join Amazon’s Brand Registry. This currently covers some 350,000 brands and gives businesses the ability to manage and track their brands, using automated algorithms built by Amazon and giving participants a hotline to reporting and acting on potential copycats and other trademark criminals.
One IP publication, IP Watchdog, describes how the IP Accelerator is a particularly disruptive concept in part because of that quick access to the Brand Registry: Previously, a company would have had to have a trademark approved by the patent office before joining. Now, it seems that as long as the application is in progress — via the legal firms that have been picked to be a part of the IP Accelerator — you can join the registry. Businesses generally try to join to get a leg up on their marketing, and critics see the Accelerator as one way to potentially game that system.
(The other way that the IP Accelerator is disruptive, according to the article? By forcing a pricing structure for trademarking services that departs from the norm, for a potentially very large audience of customers, which also could lay the groundwork for a wider set of legal services for businesses.)
The business of providing business services to SMBs on the platform is an interesting one.
We’ve seen a number of startups emerge in recent times that are looking to acquire and roll up the best of the SMBs that sell on Amazon with big ambitions of their own.
Their plans are to use economies of scale to run these businesses better, with better supply-chain management, marketing, IP control and more. That strategy is predicated on the fact that those small businesses are finding it a challenge to take their enterprises to the next level on their own.
In that regard, Amazon’s IP Accelerator potentially gives those smaller sellers another helping hand to stay independent (or at least grow their businesses enough to catch the attention of these consolidators).
“Great ideas are the core of every good business. Turning those ideas into a reality relies on IP,” Pippa Hall, director of Innovation and chief economist at the U.K.’s Intellectual Property Office, said in a statement. “Understanding, protecting and getting the most out of your IP is a crucial ingredient of success. A good IP strategy should sit at the heart of every good business plan.”