Battling the Gray Market
The e-commerce market continues to grow with estimates around 12.3% over the next 5 years according to Forrester. As consumers continue to head online to buy their most valued products, we can only assume that there is a potential for the same increase in gray market and counterfeit sales. The impact that unauthorized sales of consumer products can be severe to the stability of authorized sellers and the product creators.
The gray market is defined by a verified product that is bought and resold to consumers for reduced or above market prices by unauthorized vendors. These sales disrupt pricing, and can create a sense of regret for the consumer when costs are clearly above those in approved markets. In creating a wave of products across the world for resale, brands can lose control of the value to which they hold on a product and its evolution. Nevertheless, if the unauthorized vendor typically has real product but replaces the real with fakes instead, yet the consumer pays the same price. The result is still the same, consumer regret (i.e. buyers remorse).
What is the solution to this evolution of online sales, which in turn will inevitably enlarge the gray market? Although many would like to eliminate the problem through litigation, which is quite costly, others would like to see it before it happens. In other words, use intuition. In the past this would have been a ridiculous notion, but with new technology it has become a true reality. Diving deep into artificial intelligence, we are now able to breach the glass ceiling, where intuition becomes a calculation for action; and, accuracy is inherent for strategic advancement. The alternative is an ever-increasing list of persons on the search for less expensive products that are easily found on the gray market. In the case of cancer patients found in China, they are pushed by high drug prices and a lack of access to newer drugs, according to the Japan Times.
The long-term effects surrounding gray market products are quality of product or in the case of pharmaceuticals the effectiveness of the drug. According to Strategy Business, for manufacturers, they can derive some short-term benefits from unauthorized retailers, outright bootlegging is harmful to profits and reputation.