eBay to launch authentication service for high-end merchandise

Digital security concept

Every year, eBay facilitates the purchase of hundreds of billions of dollars worth of goods, but even though eBay is one of the web’s ecommerce pioneers, friction can still be found in its marketplace.

One of the biggest sources of friction on eBay relates to counterfeit goods, particularly in high-end merchandise categories such as jewelry, fashion and handbags.

eBay and luxury brands like LVMH and Tiffany & Co. have done battle in the courts, but ultimate, eBay understands that its interests are largely aligned with those of the luxury brands.

After all, if consumers can’t trust that the goods they purchase on eBay are authentic, it hurts eBay too. According to Laura Chamers, eBay’s VP of Consumer Selling, in large part because of counterfeiting concerns, “We know that many shoppers may be hesitant to purchase high-end products online.”

While eBay says that a counterfeit items make up a miniscule portion of the items listed in its marketplace, and it has for years offered a Verified Rights Owner program that lets brands report suspected fakes, the company late last week announced that it will be launching a new program called eBay Authenticate later this year.

As the name suggests, eBay Authenticate is an authentication service that is designed for high-end merchandise. Initially, the service will be available to sellers who sell luxury items like handbags. For an as-yet-specified fee, sellers of these items will be able to pay eBay to have professional authenticators authenticate their items.

In a press release, eBay explained the mechanics of the program:

eBay sellers who sell certain types of inventory, such as high-end handbags, will have an opportunity to opt-in to the authentication service for a fee when listing a product. In return, there will be messaging on their listing that highlights that the item will be reviewed by a professional authenticator before it’s delivered to the buyer. If the item sells, a professional authenticator will examine the item for authenticity. If the item passes inspection, the item will be forwarded to the buyer.

To further instill confidence for buyers, eBay says that, subject to certain terms and restrictions, it will refund buyers two times the cost of the original purchase price if merchandise they purchase is found to be counterfeit during the eBay Authenticate process.

A niche market

eBay’s Chamers says “For sellers, [eBay Authenticate] will be most beneficial for those who are looking to part ways with their high-value items, but don’t necessarily have a long established selling history on eBay.

For our more established sellers, the service may not be as meaningful given they’ve likely established a trusted reputation, but it will certainly be available to all sellers.”

Uptake will also depend on the fee structure eBay sets and whether it’s competitive to alternative services sellers can use to move high-end merchandise.

Despite the scale eBay’s marketplace, concerns over counterfeits have created a niche opportunity for other companies like The RealReal, Rebagg and Lollipuff. They run marketplaces and consignment-style services that focus exclusively on high-end merchandise and bake authentication into their offerings.

Related reading