Barry Adika: The second algorithm we built was for counterfeit detection based on image recognition. We teach the AI what to look for. There is such diverse information that we teach this AI to look for and bring us results.
On some occasions, because search is built by many elements like price, quantity, and reviews, we need to know how to sort this data to get to where you want to be.
The image recognition mechanism that we have is very interesting. It’s looking for the product in a resolution that your eye cannot see. Let’s say I’m an IP administrator for a brand, and I’m using Brandefender. All I need to do is open the platform and put the logo of my company and a few other elements. It will come to you with leads.
We discussed two different issues. We discussed domain protection issue, and we discussed the seller information which Amazon is trying to hide from the brand because they’re getting profit by having those sellers selling on Amazon.
Brands cannot control the pricing online. If I’m selling on Amazon, I have to reduce the price in order for me to sell. When people understand that, the key metric for them to do business is to have access to the brand in order to buy the product. Not many have access because not many have stores.
People who have stores like me understand how it works. I’m not allowed to sell online but because there’s no business, some people are forced to sell online. When somebody goes online and finds somebody that might have polos or a spike in sales for a store in Brooklyn, they have an issue because all these products are leaking online.
The issue is twofold. One is stores are saving from the market in amounts that is unheard of. Macy’s just closed a hundred stores two weeks ago. On the brand side, they don’t have anyone to police the internet. They don’t have any control of what’s going on over the internet. This is the problem.
The solution is to bring technology into this mechanism and understand how everything works. After a few years, Amazon received a lot of lawsuits from a lot of brands for counterfeit products, misrepresentation, and many other things. You can imagine that those lawsuits didn’t go anywhere. They just kept suing and suing.
Amazon, in order to push back, said, “From now on, we’re going to inspect the third-party sellers that we have, and we’re going to ask sellers to give us invoices showing that the product is real.” I have an account. All I need to do is send them an invoice that my store is in New York. That this store in New York belongs to my cousin in Brooklyn.
Not a lot of people have direct accounts. If they do have direct accounts, they don’t have direct accounts at the retail level. They’re buying from individual stores. You might have 20 or 30 brands. From each brand, you can sell $100,000 a month making 10% from every single brand. It becomes a business.