Swarovski in spat with 360buy

Chinese online business-to-consumer retailer 360buy.com confirmed on Monday that Swarovski products sold on its platform are genuine and legal after the luxury crystal brand announced its intent to take legal action against the retailer for selling Swarovski products illegally in China.

Swarovski Trading (Shanghai) Co said the company has not authorized any website to sell Swarovski products online in China and the company only provides after-sales services to the customers who buy products in offline stores with warranty cards and sales slips, according to a report by China Business News (CBN) on Monday.

360buy.com confirmed with the Global Times on Monday that the products are procured through legal channels with regular commercial invoices, and the platform would be responsible for the after-sales services of the products.

"We are still negotiating with Swarovski as the online products' prices are lower than the brand's official price," the company told the Global Times yesterday.

Swarovski was not immediately available to comment on the dispute.

The official price of a Swarovski breastpin is 600 yuan ($95.4), but sold for only 480 yuan on 360buy.com, according to the two companies' websites.

"Online prices are lower than the traditional offline stores due to lower operation costs, but the lower prices are attracting customers to buy products online, which hurts the offline business," Li Fangting, an analyst at the CIC Industry Research Center, told the Global Times yesterday.

Swarovski is not the only brand facing the issue of lower online prices. TISSOT China said it would not provide after-sales services for products sold on dangdang.com, after the e-commerce platform sold TISSOT watches with 25 percent discount on the Fathers' Day, according to CBN.

Normally e-commerce companies get the products from the brands' agents, even though they don't have authorization from the brands directly. So the brands should focus on the management of their agents to ensure the agents are entitled to provide goods to e-commerce platforms, Feng Lin, an e-commerce analyst at Hangzhou-based China e-Business Research Center, told the Global Times yesterday.

If the products sold on e-commerce platforms are genuine, brand owners can not accuse the websites of trademark infringement, even if the websites do not have the brands' authorization, Liu Jiahui, a lawyer at Beijing-based Derun Law Firm, told the Global Times yesterday.

If brand owners can allocate specific products for online sales which are different from the products sold in offline stores, the brands will not be affected by the price difference, Li from CIC said.

Nevertheless, both online and offline sales are needed in order to satisfy different customers' demands, despite some differences between the two channels currently.

"The two platforms will have a harmonious development in the future," Li noted.