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Thought Leaders in E-Commerce: Barry Adika, CEO of Brandefender (Part 4)

Posted on Sunday, Feb 23rd 2020

Barry Adika: Amazon decided to freeze some accounts that don’t have proper documentation. For these sellers, to photoshop an invoice is not a big deal. There’s no enforcement on Amazon’s side. That’s why they have six million members currently.

Long story short, those guys got smarter. Let’s say you have a big Amazon account. It’s millions of dollars in inventory and millions of dollars in pending payments.

Suddenly, your account is frozen. The only thing you need to do is get it resolved with Amazon. You need to open a new Amazon account under a different name with a different bank in order to get back up. People open 10 accounts a time, 20 accounts at a time, 40 accounts at a time before it becomes a massive business.

There are sellers on Amazon that sell around $400 million to $500 million a year. It’s not a small business by any means. Brandefender can associate the amount of accounts that you have on any platform online. We see you everywhere by uploading the UPC’s of the brand to our platform.

We are assisting brands detect many things – price violations, domain protection, counterfeit product, gray market trafficking. The most recent solution we have is authentication. You buy a Louis Vuitton bag on eBay, but you don’t know if it’s real or not.

We have a token that installs in some of the brands that we are working with. This token will give you a serial number that when you scan it with your phone, you will know if the bag is authentic or not. The problem is bigger than we think. The problem is not about our company which is brand protection.

I jumped into this field because I saw the shift in retail. I saw the growth online. I saw the demand for doing something in policing the online marketplace. On top of that, I have the understanding of how the mechanism of wholesale and retail works. I understood the bylaws, so to speak, between a brand and a retail store.

Then I had to understand how Amazon treats their sellers in order to understand how Amazon works. I gave you a reference to Amazon but it can be any platform today. Walmart is accepting third-party sellers. eBay is a giant.

Today, the retail becomes some sort of an experience, and you shop online. You go to a store to enjoy the excitement of what the brand will do. Bottomline, it’s more convenient to buy online. Take everything I told you and think about kid’s safety or medicine.

Maybe a safety chair for kids. When we found this specific chair that’s $100 cheaper, and this chair can’t even pass any safety law, kids might be in danger. It’s not just making a dollar or making a transaction. This is a real concern and it’s happened everywhere.

The main protection that I mentioned to you is not necessarily about a company like Ray-Ban. It’s about your banking today. You bank with Bank of America. I find a domain that’s called bankofamerica.app. I went to LinkedIn and saw all the VPs. I open their emails and send an email to somebody at the bank saying, “This is Richard. Please approve the wire to Sammy.” He’s not going to open my domain. 

Sramana Mitra: Help me understand how you charge. 

Barry Adika: We have a monthly fee. We have different ways of charging. We can charge per UPC. Most of the items that sell online are the best selling items. For example, I’m not going to buy the entire collection of Lacoste. I’ll only buy the black and white Lacoste polo that sells for 40 years online and offline.

Basically telling the brand to give us the 250 UPCs of their best product. This is usually what’s being violated online. That’s one way we charge. Another way we charge is per region. Do you need America? Do you need Europe? Do you need China? Where do you see your product being counterfeited a lot?

Another way of charging is also by marketplace. Some of them will say, “I don’t really care about eBay. I care about Walmart.” It depends on the customer’s needs.

This segment is part 4 in the series : Thought Leaders in E-Commerce: Barry Adika, CEO of Brandefender
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