A relationship between online marketplace Amazon and sports shoe brand Nike looks set following various media reports the shoes will be sold directly to consumers via an anti-counterfeiting brand-registry programme.
Currently, the Nike brand – which is popular with counterfeiters – is only available on Amazon's Zappos platform and not through the main company. Yet there are more than 70,000 listings for Nike products on Amazon.com, which include counterfeits and items sold by unlicensed vendors.
According to a Goldman Sachs report, that was released yesterday, Nike is "close to commencing a direct relationship selling product on Amazon.com".
The speculation follows reports at the end of last year that Amazon was pledging to make 2017 the year of banishing fakes from its platforms by working directly with brands to establish a stricter registration process for listing products online. At the time, it was understood that Nike was trialling a pilot of the system.
According to Bloomberg, who spoke to an unnamed person 'familiar with the situation', "the approach lets Nike take greater control over how its products are sold, helping ensure that knockoff shoes aren't offered by third parties on the e-commerce marketplace".
They said that Amazon plans to use machine learning to detect fakes with the aim of picking them up and taking action before the goods are even listed on the site.
As part of the deal, experts believe that Nike will require Amazon to be more ruthless in its efforts to rid the site of counterfeits and dodgy third-party vendors.
"Sellers may find themselves feeling like they have targets on their backs, stuck with inventory they can't sell on Amazon and possibly suspended for bad Nike products," Chris McCabe, an e-commerce consultant and former Amazon executive, told the New York Post.
The bonus of a potential move by Nike is two-fold. One the one-hand it allows it to address the issue of counterfeits, especially on one of the largest online marketplaces. On the other, it's an opportunity to market its merchandise directly to consumers, when the vast majority of its products are sold via sports retailers, such as Foot Locker, as well as allowing it to directly compete with other sports apparel brands on the platform.
Lindsay Drucker Mann, an analyst at Goldman Sachs, told *Bloomberg *she believed a deal with Amazon could boost Nike's revenue by 1 per cent and she expected more brands to follow suit and carry out similar deals.
Already Victoria's Secret and Procter & Gamble products are taking part in the brand registry programme.
Amazon's current process for kicking off knockoffs is rather flexible with the onus on brands to inform the e-retailer of the fake goods before they can be removed. Yet, despite being booted off, the counterfeiters can easily jump back on under new accounts with slightly different details.
Under the new brand registry programme, the registration process would be stricter, requiring sellers to register with Amazon and prove they have the brand's permission to sell the brand-name goods online.
Amazon also plans to include in the brand registry merchants and brands that currently don't sell on the platform, with an effort to include thousands of companies this year.
The crackdown on counterfeits follows increasing criticism of Amazon, and other online marketplaces, for not doing enough to stop fakes being sold online.
Last year, Birkenstock pulled its products off Amazon in protest of the continued presence of fakes. But according to Bloomberg, the sandal maker has reassessed the situation and had a change of heart.
A company spokesman told the newswire it had "seen improvements on the Amazon marketplace addressing our core issues of unauthorised sellers and counterfeit goods. As a result, we have continued to allow select third party sellers to list Birkenstock products on Amazon.com in the US".