Taobao's efforts to fight counterfeit - real or fake?

Last week the BBC published a list of 'strange' things you can buy off the Chinese ecommerce platform Taobao.  Bargains listed include boyfriends for hire, breast milk soap and bags of live scorpions.  Not your average 'shopping mall' experience, but then Taobao is anything but your average shopping mall website.

With over 800 million items listed on one of the world's top 10 Alexa ranked websites, surely this is a C2C paradise, as the BBC put it, "a combination of eBay and Amazon, only bigger". You really can buy pretty much anything. The BBC’s list gives us the strange and exotic, and a quick search by NetNames uncovers diverse but relatively mundane products such as hair crimpers, car parts and the marvellously entitled book, "Camels and their cousins: a treasury". A veritable 21st century Aladdin's Cave. Surely this is a beacon of all that is great about the age of internet empowerment. Buy anything from anyone, anywhere and we can all trade happily ever after. Half a billion users can't all be wrong?  Right?

Not quite.  There is a darker side.

In the brand protection world, Taobao is very well known to NetNames and this is an online environment where everything is not as it seems. Yes, there are many millions of genuine products being offered and many consumers must have had many happy shopping experiences. Taobao's popularity says this must be so and this is a clear reason for the site’s meteoric rise in popularity. However, what is also clear is that the buying and selling of counterfeit products on this leading ecommerce platform remains rife. Recent and very public examples of concerns from brand owners and consumers link Taobao with the counterfeit sale of luxury goods, sports apparel, watches and even English Language Examination Certificates. With consumers publishing online guides such as, "How to avoid buying fake stuff on Taobao" and, "How to buy from Taobao - identify real and fake goods", this is a problem that is well known and well documented. Brand owners and their representatives, NetNames included, have been working tirelessly, often in unfamiliar legal and governmental jurisdictions, with Taobao to try and stem the flow of counterfeit goods being offered on the site.

So does Taobao care what happens on its site?

The answer to this appears, according to recent developments, to be a relatively cautious "maybe".  Alibaba Group, the owners of Taobao, now recognise publicly that many government organisations, what brand owners and consumers have known all along, i.e. that has been and still is a rampant volume of counterfeit product being offered on the site.  As evidence of this, they recently submitted a paper to the WIPO Advisory Committee on Enforcement that describes their ever-evolving policy towards counterfeit goods being sold on their sites. An extract makes for ever-so-slightly reassuring reading, "At present, the Group spends over 100 million yuan each year fighting inferior and counterfeit products. It has established a 5,000 strong professional IP protection team consisting of staff from relevant departments and online volunteers. In the past year, Alibaba removed more than 100 million hyperlinks to products suspected of IP infringement", including millions on Taobao. This is an improvement in both openness and activity. Alibaba Group has certainly become more visible in recent months and is engaging more with brand owners, trade associations, law enforcement agencies and governments alike. This is good news, but there is still a long way to go to address brand owners legitimate concerns.

Some might say that the Alibaba Group is striving for legitimacy in the eyes of Western investors with their US IPO this week. Others may say that the Group is genuinely concerned with erasing as far as possible the threat posed to brand owners by counterfeit on their platforms. With all eyes in the IP world turning to Hong Kong and the INTA Annual Meeting in May, and increased pressure on Alibaba Group by brand owners and their representatives, only time will tell.

By Haydn Simpson, Product Director, Brand Protection at NetNames.