Poshmark Fashion App Adds a Layer to Detect Fake Designer Labels

Deni Greene has been selling her used designer handbags on the Poshmark mobile app for more than a year. She always checks the authenticity of the Chanel purses and other luxury lines she sells to make sure she and her customers don’t get burned.

But not everyone is as vigilant or honest as Greene. That is why Poshmark, a 3-year-old mobile app launched by Manish Chandra out of Menlo Park, Calif., unveiled a free new service that will help buyers on the fashion and accessories destination make sure they are getting the real McCoy.

On Dec. 4, Poshmark launched Posh Concierge, a free luxury authentication service for high-end handbags, accessories and other designer items priced at more than $500 and sold through the mobile app. Less than 10 percent of the 7 million mostly used items for sale on Poshmark are considered top-tier luxury items. But Chandra is hoping that Posh Concierge will make buyers more eager to purchase tried-and-true labels online with more confidence.

To celebrate the launch of Posh Concierge, Poshmark is creating a Chanel boutique where shoppers can access more than 17,000 Chanel items across 8,000 Poshmark closets.

“We wanted to add an extra layer of service to the market,” Chandra said. “This new service gives sellers and buyers extra protection. They know the product has been validated, so there is no risk there.”

Poshmark is basically a way for people to sell what’s in their closet or shop other people’s closets. About 20 percent of what is sold on the fashion app is new clothing. But the rest is used—ranging from J. Crew dresses to Hermès purses.

For those who want to make sure the designer label is real, Posh Concierge works this way: When something sells for more than $500, the item is not immediately shipped from the seller to the buyer. Instead, the seller receives a pre-paid, pre-addressed shipping label to send the item to Poshmark. Then Poshmark, through its in-house staff or experts around the country, checks the validity of the item, which is then sent on to the buyer.

“Most sellers try to verify their items, but I am grateful for this extra level of scrutiny,” Greene said.

On average, about .05 percent of items sold on Poshmark are disputed for their authenticity, Chandra said. With Posh Concierge, he is hoping to reduce that to zero even though the mobile fashion app has Posh Protect, which gives buyers three days to return an item for any reason. “Sometimes our buyers may not know they have been delivered merchandise that is not real,” Chandra said, noting they have no recourse after missing the three-day return window.

Making and selling counterfeit designer goods is big business. U.S. Customs and Border Patrol agents last year seized $1.74 billion in counterfeit goods brought mostly in cargo-container ships. Value-wise, 40 percent of all counterfeits found by customs agents were handbags and wallets. Another 30 percent were watches and jewelry.

But that is only a small portion of what is really out there. The International Anti-Counterfeiting Coalition predicts that $1.77 trillion in global trade will be done next year in counterfeit and pirated items, which includes pirated DVDs, fake consumer electronics and apparel.

China is by far the largest source of all counterfeit items, followed by Hong Kong, government statistics show.

Counterfeit websites are extremely abundant and clever. Many times, knockoff artists copy photos from real designer websites and put them on their own websites. The product being sold may resemble the real item but uses inferior raw materials.

Anti-counterfeit experts advise that if a price is too good to be true, it probably is a fake. Also, Internet shoppers are warned to look for typos and spelling errors on websites, which is an indication that they are not legitimate selling spots.

So far this year, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and other law enforcement agencies across 18 countries have shut down 29,684 domain names illegally selling counterfeit merchandise online.

With the new Posh Concierge service at Poshmark, Chandra is hoping to amp up luxury-item sales at the mobile phone app, started in 2011 after he founded and sold Kaboodle Inc., a website to collect, organize and share information found on the Web.

He said Poshmark’s revenues grew tenfold last year and are expected to double or triple this year although he would not give total revenue numbers.

In the past year, Chandra said the destination has seen growth in sportswear, modern designer labels and teenage brands. In the future, Poshmark is hoping to add categories for menswear and childrenswear, and it hopes to soon debut in the international market.