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Outside Business Journal

Cotopaxi Opens Up About Recent Facebook Scam  

Last month, a string of fraudulent websites started posting fake Cotopaxi ads on Facebook. Leaders of the outdoor brand say response from the social media giant was slow.

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Geoff Nudelman

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Cotopaxi, arguably one of the outdoor industry’s fastest-growing brands, is the latest to battle fraudulent ads and sites linked to Facebook.

According to Cindy Grönberg Moldin, Cotopaxi’s vice president of brand, the company started receiving messages around October 25 as customers contacted the brand questioning the authenticity of ads promoting deals of up to 80 percent off and claiming the brand was closing. The ads were sending customers to fake sites bearing the Cotopaxi name. 

“In the past, we’ve faced ‘rogue sellers,’ which take copies of our images and pretend to sell Cotopaxi gear on Amazon, eBay, or other sites, but never a duplicate website,” Grönberg Moldin said.

Once the Salt Lake City-based brand became aware of these fake ads, pages, and sites, the brand reported them to Facebook through its account representative following normal processes the social media platform has in place. Cotopaxi also worked with data security service Red Points, which it hired before the incidents, to find the origin of the “rogue actors” and begin shutting them down.

Grönberg Moldin said the initial analysis came back with a total of 14 rogue duplicate sites, with similar creative and layout, all created around October 25. Most were using GoDaddy for site hosting and apparently originated from Singapore, although they couldn’t identify any individuals responsible for the pages. The analysis also found eight fraudulent Facebook pages, but no responsible creators.

“Apparent frequent bombardment to our consumers, making sure they weren’t negatively affected, was our biggest concern,” Grönberg Moldin said. 

How Cotopaxi Responded to the Facebook Scams

Cotopaxi quickly posted to its Facebook, Instagram, and LinkedIn pages about the fraudulent activity and worked to ensure that consumers could also find information easily if searching through Google.

Grönberg Moldin said she wasn’t surprised Cotopaxi was targeted, as these types of attacks and scams have escalated during the pandemic, but did voice her frustration at the slow response from Facebook’s business team. After Cotopaxi alerted Facebook of the scams, nothing happened over the course of a week. “Our CEO [Davis Smith] was getting very frustrated,” she added.

This lack of action prompted Smith to post on LinkedIn on November 8, detailing the ongoing issues, providing a photo example of one of the fraudulent ads, and advocating for better transparency and policy from Facebook about scammers. 

The post had more than 3,000 views and 330 comments as of November 12. While Smith didn’t respond to request for comment, Grönberg Moldin said the post got Facebook’s attention right away, and Facebook quickly moved Cotopaxi into a “high-frequency monitoring program” for businesses actively dealing with scammer and security issues.

While that program began the process of removing the fake ads and pages from Facebook, it also disabled the personal Facebook accounts of 11 Cotopaxi employees including Smith, CRO James Hampton, and COO/co-founder Stephan Jacob. (All have since had access restored.) Grönberg Moldin believes their access was temporarily disabled as a result of each having personal accounts linked to the control of Cotopaxi’s main Facebook page.

As of this week, the increased visibility and security work seems to be paying off. Grönberg Moldin said only three fraudulent websites and one Facebook page remain, but she’s unsure about the total cost and how much Cotopaxi lost in terms of inventory and brand awareness. She noted Redpoint will offer a more detailed analysis in the weeks ahead to help quantify the amount. 

The Future of Cotopaxi’s Digital Marketing Strategy

While the brand isn’t stopping its Facebook spends—as others, like Patagonia, have done—it is reconsidering the value of this type of outreach. Grönberg Moldin is concerned that if Cotopaxi were to pull out of Facebook, it would leave the door open for scammers to continue creating and promoting fake ads and accounts.

“We’re assessing our options,” Grönberg Moldin said. “It’s a two-way road and we need to use Facebook as one of the biggest platforms right now.”

In the meantime, Cotopaxi has created a page in its Help Center explaining the problem, listing the fake sites, and offering customers advice on what to do if they have been scammed.

“Whether we like it or not, Facebook is one of those avenues where our consumers are based and we’re very dependent on it right now,” Grönberg Moldin said. “But that doesn’t mean we might not change our mind in the future.”

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