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Alibaba Goes to War Against Counterfeits

Dec. 23, 2014
Over the last two years, China's Alibaba Group has invested over $161 million to help eradicate fake goods from its e-commerce sites.

China's booming market for counterfeit goods isn't exactly a big secret.

And because of that market, China's most popular e-commerce site, Taobao – part of Alibaba Group's global enterprise that allows merchants to sell their own goods directly to consumers – has unwittingly become one of the largest counterfeit trading sites in the world.

But Alibaba is apparently putting an end to that

Today, the company revealed that since it began to its ramp-up to the U.S. market back in January 2013, it has invested 1 billion yuan – that's about $161 million – to identify and remove all fraudulent and counterfeit goods from its sites.

"From Alibaba Group's perspective," Alibaba CEO Jonathan Lu said in a statement to Reuters today, "we bear a serious responsibility in this fight against counterfeits."

So far, that fight seems to be working.

In the two years the company has spent focusing on fake goods, Alibaba reports that it has identified and blocked over 90 million products from its sites.

And that seems like a pretty good start, but there is still a long way to go.

According to the Reuters report, with the $9 billion in sales racked up in this year's annual Single's Day online shopping extravaganza in China, the State Administration of Industry and Commerce found that about 10.6% of all goods sold were either fake or highly suspicious.

Of course, with a platform like Taobao, it would be practically impossible to eliminate every counterfeit from every merchant, so we should probably be encouraged by a number like 10.5%.

But as the company shifts its focus to U.S. consumers following its record-breaking IPO earlier this year, these remaining counterfeiters profiting from the platform will be coming under much closer scrutiny.  

Read the full article on Reuters.

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