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Resellers vs image monitoring

Malevolent resellers often buy up highly anticipated products and resell them at a premium. Find out how this affects your brand and how globaleyez can contribute to the solution of this issue.

Per definition, resellers purchase products with the intention of selling them on to other people. The majority of them are honest professionals whose work is necessary to keep a distribution channel effective and functional.

However, there’s another group, also called resellers who often make the news, and not in a good way. Sometimes they’re even referred to as scalpers. But who are they, and what kind of problems do they create?

For the sake of clarity, in this article we’re going to disregard honest resellers mentioned in the first paragraph and use this term solely to refer to people with dubious intent.

Resellers 101

Just like their honest counterparts, scalper resellers purchase products with the intention of selling them on to others. However, these people don’t act according to a contract with the manufacturer or the brand. Instead, they buy products in bulk and resell them to consumers at a much higher price.

They often target highly coveted new products right after their release, like limited edition sneakers, tickets to concerts and sports games, or gaming consoles like PlayStation.

Any product that’s in high demand could become the next victim of a scalper attack, but the most affected by this type of action are limited edition luxury goods. No wonder: highly coveted goods with a restricted availability are often the ones people are willing to pay a lot of money for.

Since resellers tend to use bots or other purchasing software to get through transactions much faster than a normal person can, whole inventories of a new product can disappear within seconds from webshops and online marketplaces, only to reappear later for a much steeper price. But this time, they’re sold by resellers.

Image of a PS 5 console and controller
Image of a PS 5 console and controller

With the right product, reselling can be a highly lucrative market. For example, the above-mentioned PS5 has made$43.2 million profit for resellers, and $15.9 million for those involved in the transactions, like marketplaces and payment providers.

Nike vs resellers

The release of a new pair of luxury sneakers, especially high-value, limited edition models provide great opportunities for resellers. Just like it happened with a pair of Nike Air Force 1 sneakers released in collaboration by Nike and Louis Vuitton.

The sneakers were sold in South Korea for ca. $2,440 and later resold on KREAM (a local resale platform) for $9,763. This prompted Nike South Korea to introduce new changes to its Terms of Sale, which was later adopted by Nike US and it’s thus quite likely to make its way across the world.

According to the new rules, Nike (that is, currently Nike South Korea and Nike US) reserves the right to cancel orders if the customer is suspected of an intention to resell. In addition, new sales limits are introduced regarding quantity, and transactions made via bots and other software can be cancelled.

While the effect of the rules is yet to be seen, sneaker enthusiasts are optimistic that brands are finally taking notice of the damage resellers do. First and foremost, to consumers, obviously. But brands are more affected by resellers than you’d initially think.

Why is reselling bad for your brand

At a first glance, a brand is not strictly affected by resellers. After all, your products get bought, and who the buyer is should not concern you. In fact, the hype the resellers create by snatching up the products may even seem as free advertisement for brands and their products.

However, this is far from the case. Disappointed customers who are repeatedly cheated out of obtaining highly anticipated products may turn their anger towards the brand that does nothing to help them in this situation.

While it’s certainly not the brand’s fault if resellers buy their entire stock, you can’t look like you don’t care about your customers’ woes. But is there anything you can do apart from commiserating?

infrimage against reselling attacks

We at globaleyez have been providing image monitoring for our clients for over a decade as part of a comprehensive brand protection programme. This service - along with many others - requires a powerful and highly specialized software solution to quickly and efficiently detect unauthorized images online, including product pictures and brand imagery.

Our in-house software tool, infrimage does just that and more. infrimage conducts a coordinated series of reverse-image searches to uncover images infringing on your brand’s IP rights. These images are either stolen from your authorized sources or recreated by fraudsters to resemble the originals. Both are used to advertise fraudulent product listings and/or webshops, and both are detected by infrimage.

Thanks to extensive filter options, image searches can be as wide or as narrow as possible, enabling you to scale our operation to your brand’s exact needs. You can create allow-lists containing authorized sellers, thus excluding them from our searches.

Screenshot of a random search result on infrimage
Screenshot of a random search result on infrimage

A highly intuitive and user-friendly interface allows you to create full or partial reports with a click and organize your search results according to your wishes.


Reach out to us to get our whitepaper and discover infrimage in detail!


And what about resellers? Well, just like regular (fraudulent and authorized) sellers, resellers need to post ads, product listings, social media content and add pictures to drive interest.

Thanks to infrimage, we can detect these images as soon as possible and alert you to the presence of new unauthorized webcontent. In addition, the accumulated results of these searches create a database of all the detected resellers, giving you an excellent overview of the unauthorized usage of your brand’s imagery online.

Whether it’s a scalping reseller or just a “regular” fraudster, the treatment is the same: once we determine that the listing is indeed unauthorized, we can enforce your rights and demand takedown to ensure that your customers are not hurt by the fraudsters any longer.

Conclusion

Nike has taken a step in the right direction when it took a stand against unauthorized resellers. How effective that turns out to be and whether other brands will follow suit remains to be seen. However, your brand can’t afford to let resellers anger your customers without at least trying to do something about it.

Contact us today and together we’ll create an effective strategy against resellers and any other fraudsters who hurt your brand's IP rights.


For more details, contact us and download our whitepaper about infrimage.


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