The grey market

The grey market

Grey market goods are not usually illegal, but they are sold outside normal distribution lines by companies that have little or no relationship with the actual producer of the goods. In short, it’s the trade of a commodity through distribution channels which, while legal, are unofficial, unauthorised, or unintended by the original manufacturer.

Because of the nature of grey markets, it’s difficult or near impossible to track the precise number of sales, but type the name of your favourite cosmetic or fragrance brand into Google, and you’ll no doubt receive thousands of results from dozens of different websites, advertising products for sale.

At first glance, the choice seems simple – you just pick the cheapest one, right?

Unfortunately it’s not that straightforward. Counterfeit and grey market cosmetics are all over the Internet. But that ‘bargain’ luxury moisturiser might be damaged, past its expiry date, or worse – a fake. According to Craig Brock, Policy & Public Affairs Director, ACCORD Australasia, “If the price looks too good to be true, then the product is most likely a fake, especially if it’s being offered at a market fair, two-dollar shop or via the Internet.”

You might not particularly care if you’re saving yourself some bucks, but there are many dangers associated with buying from an unauthorised retailer:

As Kate Morris, founder of, an authorised online retailer for brands like Dermalogica, L’Occitane, Jane Iredale Mineral Makeup and Bloom, says, “The main danger is not getting what you paid for. You don’t know where a product has come from, where it has been on its way to you, what conditions it has been stored or transported under and how old it is – or even if it’s genuine.”

Chris Hatfield, Corporate Online Manger for Clinique, Australia attests, “Fake products can have a stolen brand name, logo, scent and design, so may look identical to the real product. What you might not know about them is that they can be harmful. These are dermatological developed products that have years of Research and Development and money invested into them. Each Clinique product is tested 12 times on 600 people. If even one of those 7200 applications incites an allergic reaction, Clinique will reformulate.” You don’t have that luxury with counterfeit goods. As Brock says, “You can be pretty certain no one will want to take responsibility if something goes wrong” with a counterfeit product. But, buy from the authorised retailer,, and Hatfield assures that Clinique “stand behind our product and offer a customer care service for any issues or questions you may have.”

Again, solution solving is something you’ll miss out on if you go down the grey market route. Morris warns, “Unauthorised sellers are not going to provide the proper brand experience. If, for example, you buy a salon-only skincare product from an unauthorised seller, without the proper information or a proper recommendation, you might think the products don’t work – when in fact you’ve bought old stock or the wrong product for your skin type or you’re not using it properly.”

So how do we shop smarter?

Come to terms with the fact that, if the deal sounds too good to be true, it probably is. Hatfield says, “Ask yourself how can somebody afford to sell expensive skincare at well below the retail price. Even if the buyer was to purchase the product at a wholesale price, how can they afford to sell them so cheap unless it’s counterfeit or over age?”

Don’t just shop on price – shop on quality, service of delivery and customer support.

Morris says signs that you’re shopping from a grey market site are: no brand logos displayed; a seemingly random selection of a products rather than the whole range; products being sold unboxed; and prices that seem too good to be true.

She advises you to buy from authorised sites that have good reputations and plenty of positive feedback. Also “ask the brand directly to recommend an online stockist.”

Know whom you’re dealing with: check the site, how long have they been in business? Is there a forum where you can talk to other customers? Make sure there’s a phone number and a street address. Google the website’s name to see if you can find any feedback from others who may have used it. Check the shipping costs and the return policies.

Remember a good deal is one where you get a product that actually works for you, with good service, fast shipping and fresh authentic stock. It’s not a good deal if you don’t get what you paid for.

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