Shoppers unhappy with poor return policies, counterfeit goods on ecommerce platforms: Report

One in five consumers received counterfeit products in the last 12 months, with the highest percentage of fake products sold on ecommerce platforms in categories like shoes, cosmetics, and fragrance, according to a study by community social media platform Local Circles.

The study, which collected over 102,000 responses, revealed that 41% of customers ended up with counterfeit products due to restrictive platform or seller return policies or failure to raise complaints. Additionally, 43% of consumers reported there was no way to report fake products on these platforms, which benefits sellers distributing counterfeit goods, as it delays their identification and removal from the platform.

Online shopping accounts for just 7% of the country's total $70 billion retail market, and the number is expected to only go higher with growing internet penetration, increase in rural smartphone usage, and low cost internet services.

While 41% of respondents were from Tier I cities, 28% from Tier II, and 31% from Tier III, IV, V, and rural districts, highlighting the widespread nature of the problem across different regions.

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According to the survey, consumers claim that sellers are exploiting the no-return policy by deliberately shipping different products, knowing that customers have no option to return them. The practice is particularly rampant on Meesho and Flipkart.

Amazon comes out on top with most preferred from returns and refund perspective. Meesho, Tata Neu, and Ajio were preferred by less than 2% consumers.

On quick commerce platforms, 22% of consumers preferred Bigbasket for returns and refunds while 13% preferred Swiggy Instamart and Blinkit, and less than 6% users preferred Zepto. Overall, one-third users were not happy with the return and refund policies and processes of any quick commerce platforms.

The government should establish clear standards for returns, refunds, and handling counterfeit product complaints. LocalCircles plans to share the survey findings with the Central Consumer Protection Authority (CCPA), Consumer Affairs, BIS, and Department for Promotion of Industry and Internal Trade (DPIIT) for appropriate policy action and enforcement.