The Gray Blog

It is a common misconception amongst those who have a passing knowledge of the parallel market that it is universally despised and opposed by trademark owners/manufacturers. This is far from true. Although the battle between trademark owners and parallel market resellers usually garners the headlines, there is a cooperative relationship between many manufacturers and the parallel market.

This entente cordiale exists for various reasons. In some cases, the manufacturer wants to seed lower market segments that it would normally not service as part of its visible marketing posture. In others, a subsidiary in one region, interested only in their regional sales numbers, turns a blind eye to sales into another territory. Yet in others, the parallel market provides a convenient way of clearing out old or unpopular inventory.

Normally these dealings between the manufacturer and the parallel market reseller are kept fairly private. This is why The Gray Blog was surprised to receive a box marked with Coty Beauty name and address which was clearly labeled on the outside flap with various routing options including “GREY MARKET”:

Coty Beauty, Inc. is a major fragrance reseller based in the US. Coty Beauty markets brands such as adidas, Rimmel, Celine Dion, Miss Sixty, Jovan, Isabella Rossellini, Esprit, and David and Victoria Beckham.

One Response to “Manufacturers hate the gray market…nudge, nudge, wink, wink.”

• michael webster 15July2008

  This is very interesting; and it raises the question about the French case why LVMH was trying to prevent eBay from enabling alternative distributive channels.

  Any ideas?

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