Jack Ma's Alibaba has been continuously plagued with allegations of selling counterfeit goods. (Photo : Reuters)
Alibaba Group Holding Ltd. has been at war with counterfeits since 2013. The world's largest e-commerce company has already spent more than 1 billion yuan ($160.7 million) in its attack against fake products and increased levels of security for customer protection.
In recent years, in line with the company's continuous growth, which included raising $25 billion for its initial public offering in New York in September, Alibaba's strategies against counterfeits constitute greater aggression.
Analysts said that selling fake products would be disastrous for the company since its reputation is on the line as the company claims to be the biggest Internet trade business even surpassing General Electric Co. (GE) and Procter & Gamble Co. (PG) in terms of market share and value.
Alibaba's strategies and efforts to block counterfeit merchandise are in line with a larger legal issue in China. The whole country is known to host multiple counterfeit merchandise. Ninety million of these counterfeits were taken down from the Alibaba platform as part of the company's efforts to block the influx of counterfeit products and to create a dependable system for raising consumer concerns.
Taobao and Tmall.com, both Alibaba's popular platforms, make the connection between the consumers and sellers. These platforms earn their keep from advertising and commission.
To lower the risk of vendors selling fake products, Alibaba took certain measures such as vendor registrations and deposits, allowing a smooth business relationship between the trading parties.
To date, Alibaba has already penalized 131,000 of counterfeit sellers, and the company's cooperation with the local authorities in multiple cases has also led to the arrest of 400 suspected counterfeiters.
