Last week, the Australian Competition and Consumer Commission flagged concerns around how online marketplaces operate. In this special series, Ragtrader looks back at the submissions to its Digital Platform Services Inquiry.
Global outdoor and travel apparel retailer Kathmandu is concerned that online marketplace platforms can be utilised as a mechanism for fraud.
“In our experience, a third party can easily create a listing using Kathmandu imagery and product descriptions and advertise our products for sale to a consumer at a lower price than we are advertising for sale of the product,” the company told The ACCC’s Digital Platform Services Inquiry.
The company was responding to The ACCC’s invitation to share views on potential competition and consumer issues in the provision of general online retail marketplaces to consumers in Australia.
Kathmandu currently offers its products for sale, as well as on its own site, through eBay, Catch.com.au, and Amazon in Australia.
In its submission to the inquiry last year, Kathmandu outlined some of the key issues and concerns the brand had experienced with marketplaces.
“Once a consumer has made a purchase, the third party then purchases the goods from Kathmandu’s own website using stolen credit card details and uses the consumer’s delivery details as the shipping address,” the company said.
“Kathmandu then ships the item to fulfil the order direct to the customer (who thinks they are receiving product via the marketplace). Following delivery, Kathmandu receives notification of a credit card chargeback for a fraudulent transaction.”
Kathmandu revealed that some platforms include a feature along the lines of, Have one to sell?
“This encourages a third party to use Kathmandu imagery and product descriptions to create their own listings,” the company says. “This approach does not assist businesses to protect their intellectual property.”
Kathmandu further stated that the platforms “do not appear to be interested in ensuring that legitimate sellers are using their platform.
“For example, while they state that they have procedures to lodge an issue over an infringing listing, very little assistance is given to take down listings of other third parties using our imagery or purporting to sell `new’ products.
“There should be policies/procedures to vet a seller’s ability to sell new items (not second-hand products) from registered brands who sell on the marketplace. In our experience, the procedures that are purportedly in place for this do not work effectively.”
Kathmandu said it had also experienced marketplaces discounting its product through offering a marketplace-funded coupon/discount code without their knowledge or consent: “Our product offered through the marketplace is then at a discount to the price we offer the same product on our own channels.”
Kathmandu has a network of 140 retail stores throughout Australia and New Zealand and operates its own direct to consumer websites in New Zealand, Australia, England and the US.