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Control diversion, reduce counterfeiting and engage consumers.

By the Authentix Brand Protection Team

Preventing unauthorized products from entering the marketplace has long been a major concern and challenge for brand owners. Products determined to be at risk should be protected to prevent adverse financial impacts as well as the health and safety of the loyal consumer.  In today’s more complex supply chains, deceptive practices such as counterfeiting, diversion and product tampering continue to be an unfortunate reality requiring more brand owners to take a proactive approach and implement protective measures to insure both the value of their brand investment and the safety of their customers.

Traditionally most brand owners have turned to a combination of security features including covert taggants and inks, overt specialty inks, and tamper evident closures as the most widely utilized security features to protect the higher value and most targeted products. However, other emerging technologies are enabling more choices by taking advantage of the near ubiquitous base of smartphones now estimated at over 3 billion active users worldwide.  New technology is becoming available which takes advantage of recent improvements in optical imaging and digital graphics to create digitally ‘connected’ products that can be added to the security feature portfolio for even greater brand protection while providing a connection and interaction with the consumer.

A connected product enables the sharing of information in real time about the product’s journey through the supply chain, its probable location of sale, volume-based unit sales trends, and if desired, an interactive connection to the customer whether prior to or after a purchase.

How are connected products created?

Products become digital touchpoints by adding unique, item level digital identifiers to the product or its packaging. This could include applications of a digital identifier to primary or secondary packaging; the capability to attribute or optically fingerprint an existing digital code or added as a covert digital identifier or “twin” to an existing printed code that prevents removal or copying of the code. These encrypted or covert digital identifiers can be added directly to the product carton, an adhesive multi-featured label, or a specialized tamper seal or other bottle or carton closure.

Unique identifiers can be delivered in multiple formats allowing for less complicated implementation, lower incremental costs, and increased levels of security. These may include overt or covert data matrix and QR codes, human readable alphanumeric codes, or embedded NFC chips, all of which can extend the visibility of the product’s journey from the manufacturer all the way to the retail consumer utilizing native smartphone capabilities.

Who can interact with connected products and how does it happen?

Multiple personnel can engage with a product and generate a recorded event or transaction as it moves through the supply chain to the final point of sale.  These transactions, evidencing a product’s journey, may occur in different ways and for different purposes. If we split these users into three groups, these could be classified as:

• Group 1: Brand owners, vendors, employees, agents, or 3PL providers
  • This group tends to use industrial scanners to engage with or interact with the codes for inbound and outbound shipments through standard supply channels
• Group 2: Contracted or agent inspector teams, law offices, law enforcement, or customs agents
  • These users can validate the authenticity of a product via a smartphone, with or without an app. The addition of an app allows inspectors to impart more detailed information, such as product pedigree and interactive incident reporting and management back to the brand owner
• Group 3: End Users / Consumers
  • Consumers are growing more averse to downloading proprietary mobile apps to engage with a brand and have shown a preference for QR codes and NFC tags, both functions enabled natively in most smartphones today. Therefore, the ability to simply scan the secure and proprietary code to obtain more information about the product or its authenticity is essential for a greater level of consumer participation in this process. A digital track and trace solution such as Authentix’s DigiTrax™ also supports a unique ability to tailor the consumer web experiences to company brands by enabling interactive engagement post product scan. Integrated with a single scan event, the consumer can, for instance, receive brand storytelling, digital promotions, manage loyalty programs and connect to social media channels.

Using the DigiTrax solution as an example, the digital authentication process occurs as follows:

• The user scans or taps a code on a product using a smartphone.
• The data is submitted to a secure platform which determines the authenticity of that product and the result (yes/no) is sent back to the user in real time.
• If the code is marked in the system as invalid, the user is notified, and an incident is recorded in DigiTrax.
• The user is exposed to the delivery of branded content after authentication.
• The brand owner accesses real-time scan data on a dashboard, which provides strategic insights and analytics that are helpful to multiple functional areas within the company.

How are connected products used?

Connected products are extremely powerful when used for the following objectives:

• Journey Tracking for supply chain security and operations management. This is generally used for diversion management so that supply chain personnel can see how product flows through the supply chain and if the product is in the right place at the right time. If the product is in the wrong channel or market it can then be traced back through the supply chain to determine where the diversion occurred.
• Authentication for brand protection and consumer assurance. Consumers and other users scan the product with their smart phone camera and learn whether the product is genuine or suspect. Counterfeits are revealed, and brand owners are alerted in real time with purchase locations and other critical details.
• Consumer Engagement for storytelling, branding and consumer nurturing. After authentication, consumers are invited to engage with the brand for marketing purposes. This could include receiving brand storytelling, digital promotions, loyalty and reward information, and links to social media and other brand channels.

The key to a successful brand protection program is the recognition that ROI can be achieved across multiple functions in the company and leveraging the data gleaned during the process for actionable insights and business analytics.  Functions that benefit from scan data include legal, brand protection, supply chain, operations, channel management, marketing and digital engagement.

What types of data can be delivered to the brand?

An enormous amount of meaningful data can be delivered to brand owners in digital brand protection programs including information about a product’s provenance, its journey through the supply chain, the location/date/time of associated transactions including consumer scan events, validation of authentication or suspected illicit activity, and direct consumer marketing and engagement.

In summary, digital authentication and connected products are a critical component in rapid detection of product compromise and can be harnessed to deliver much more, too. Connected products are powerful inspection, reporting and communication tools that continue to deliver data to the brand and information to the consumer long after their point of sale.

To learn more about Authentix digital brand protection solutions, schedule a meeting with our experts by emailing info@authentix.com.

Protecting consumers and safeguarding your company’s brand identity and reputation is becoming increasingly challenging in today’s environment with the continued growth of counterfeit and diverted products entering the market. At the same time, consumers are taking a more proactive role in choosing to buy brands they know and trust, while expecting increased transparency in brand promise.

As supply chains become increasingly complex, brand owners are facing intense pressure to respond to traceability and transparency challenges by utilizing digital systems for collecting valuable data and analyzing and acting upon the visible trends to help consumers authenticate products at points of sale, or alternatively connect and engage with the brand owner directly via the web or app. A digital solution helps with monitoring product movement in the supply chain, as well as direct consumer feedback, to confirm legitimate or potential suspect product in the marketplace.

67% of consumers say brand trust has a great deal of influence over their buying decisions.

In todays connected marketplace, most companies already collect and use various forms of data analytics to drive ongoing business decisions and strategic initiatives. In fact, business action and decision making has become reliant on the use of data analytics to manage many day-to-day operations. Despite this growing reliance on data, most organizations have yet to apply the practice successfully when it comes to brand security. This can partly be attributed to the lack of reliable data available since the early adoption of digital track and trace capabilities for risk-based products is only beginning. The key to effectively using data in brand protection programs is to understand what data is available now, what data is needed that is not available, how to efficiently collect and analyze the data and lastly, what action can be taken based on this analysis to effectively reduce counterfeiting and diversion while simultaneously engaging directly with the consumer.

Data Identification

An enormous amount of meaningful data can be gleaned in digital tracking for brand protection programs including information about a product’s provenance, its journey through the supply chain, the location/date/time of associated transactions including consumer scan events, validation of authentication or suspected illicit activity, and even direct consumer marketing and engagement.

However, how to apply the data once collected can be different for each company. At Authentix, we collect supply chain and consumer interaction data from multiple sources and aggregate it into our secure cloud-based platform on behalf of our brand owner clients. From there we are able to configure rules and analyze data trends to provide our clients with complete visibility into the suspect events or grouped metadata revealing weak links or threats in supply chain operations that often point to product compromise.

Data Collection

The following are key areas for collecting data using digital track and trace technology.

• Data Carrier Technology – includes multiple formats of barcodes, NFC and RFID technologies for supply chain tracking, purchase and post purchase consumer engagement, inventory movement, and theft prevention. These technologies vary greatly in terms of volume capacity, costs, application requirements and security levels, so it is important to evaluate the best types of code formats and integration to existing manufacturing and packaging processes that best meet the minimum needs that would produce a valuable return.
• Track & Trace – can be accomplished during sourcing, manufacturing, distribution, and pre- and post-sale stages. During the printing, manufacturing or packaging process for example, the scope of implementation choices widen and we can provide multiple routes to enable tracking of product origin information, manufacturing location(s), production lines designation and more. Additionally, as the product nears closer to the point of sale, we’ll begin seeing authentication activity and the collection of meaningful data such as distributor and consumer interaction and engagement, and sustainability and circularity.
• Authentication – in most digital track and trace systems, analysis of authenticity is often achieved via a smartphone. This can be by company inspectors using a proprietary mobile application all the way to the consumer who can interact with the product without having to download a mobile app. Using the Authentix DigiTrax™ track and trace solution as an example of direct consumer engagement, the smartphone user simply scans a proprietary and encrypted QR code which directs them to a custom URL experience that can include, among other things, the unique information associated with the individual product scanned. These consumer product scan events including geo location, date, time, product and product provenance information are submitted to the secure cloud-based DigiTrax platform where the information can be used to understand purchasing trends, market directly to the user, or allow the user to authenticate the product using proprietary codes or PINs. If designed for the purpose, the results of the authentication can be sent back to the user in real time. This technology also enables inspectors in the field and other key stakeholders to identify the authenticity of a product instantly using a more sophisticated mobile application. In addition, consumers may also use the DigiTrax platform to verify authenticity of other products or for the purpose of continuing engagement with brand owner purely for marketing purposes.
• Online Surveillance and Enforcement – are methods, systems, and services used to identify, investigate and takedown unauthorized e-commerce websites that deal in illicit trade of counterfeit, diverted, or stolen products. This is accomplished through automated online tools and services such as marketplace monitoring, WeChat micro tasking, and machine learning which can identify risk levels, hot zones and image matching to police and eliminate unauthorized sales of product and illegal use of trademarks on the internet.

Putting Data to Use

Reliable and timely data feedback enables brand owners to quickly answer complex supply chain events, pinpoint trouble spots, and take corrective and even preventative action to reduce the instances and threats of unauthorized product entering the marketplace. Data can be used to assess multiple business-centric operations to increase sales and market share, acquire and build trust with new customers, and reinforce brand assurance, to name a few. In addition, as consumers become more reliant on smartphones for collecting and communicating information, brand owners can capture consumer data to tailor experiences and increase engagement and loyalty.

Using Data to Drive Success

Authentix customers are using valuable brand protection data and analytics in multiple ways with great success. In one customer success story, an international wine exporter faced counterfeiting and diversion issues in China, resulting in loss of consumer trust and risk to its strong market share and long term brand loyalty it had spent years building. Authentix helped the client implement a multi-layered digital authentication solution with covert and overt on-product features that flags, collects and analyzes all inspector and consumer scanning activity including the capability of retail product authentication by the consumer. The result? Over 150 counterfeit retail locations were identified and remediated. Also, through direct consumer engagement, loyal brand purchasers became more confident in product authenticity and the client was able to maintain premium pricing for their superior and quality products.

In another example, an international brand customer incurred online marketplace counterfeiting in Asia, putting consumer health, safety and loyalty at risk as well as decreasing revenues. Authentix helped the client implement a multi-phased online brand protection monitoring solution and services to identify and investigate the online sale of spurious product and locate complicit bottling and closure manufacturers involved in the illicit trading. Website takedowns were initiated, resulting a 90% reduction in fake products in Indonesia, 1,500 online listing takedowns in Malaysia, and 13 raids and enforcement actions conducted in China.

Start Big or Small. Just Start.

It’s important to point out that you do not have to implement a full scale approach to digital authentication initially and it’s easy to begin collecting and leveraging data – even if it’s just one product or product line for a particular geography. Alternatively, digital automation for brand protection programs can be implemented in a sweeping fashion as an end-to-end solution from the start with a full technology suite. Most clients choose to implement in logical steps based on risk assessment, ease of implementation, and to the most critical geographic areas. The key is to get a secure digital mark on your product and start the data collection process. Ultimately, it is how much data, the association of the data elements for analysis, and the conclusions and action you take that determines how much your brand protection program can be enhanced by bringing in digital track and trace automation. The key is to start, analyze, adjust, expand and continue until the data flow and insights provided are resulting in the development and refinement of actions and policies to take command of the risks faced each day.

Learn more about Authentix brand protection solutions, HERE.

From Identification, Surveillance, Investigations, and Website Takedowns: Authentix now Provides Full Service Online Brand Surveillance and Enforcement

To expand its capabilities in digital brand protection for brand owners, Authentix has recently acquired Strategic IP Information Pte Ltd (SIPI), a leading online brand and content rights protection service.

For over ten years, SIPI has offered state-of-the-art services for brands to track unauthorized channels for counterfeit products through its proprietary online tools and array of customized services including physical enforcement, investigations, sample purchases, and taking down pirated listings. Using a team of dedicated analysts and sophisticated platform technology, we can promptly detect infringement and counterfeiting activity for rapid action and consolidated, insightful reporting for the 200 brand customers now serviced.

In the last two decades, counterfeiting has quickly grown from city sidewalks to the internet marketplaces. While e-commerce has opened new doors for traditional and start-up brands, it has also provided illicit traders lucrative access to a global customer base.  Online counterfeit goods now total an estimated $590 billion globally and according to a recent study by the European Union Intellectual Property Office, 1 in 10 online buyers has been deceived into buying a counterfeit product.

Tokyo Olympics – Example of Recent Target

As online marketplaces continue to be exploited by illicit traders there is a growing amount of peddling with convincing bootleg and falsified versions of branded products. This illegal activity increases during major global events such as the recent Summer Olympics in Tokyo for example. While there was ample licensed merchandise sold through the official online store of the Olympics, there was also falsified and unlicensed merchandise selling through illegitimate, third-party websites.

As Authentix/SIPI closely followed the action in the Olympic games, they also investigated licensed branded merchandise sold online, where it was discovered that marketplaces, social media and multiple 3^rd party websites were offering unlicensed and infringing products. Using t-shirt sales as an example, the product offered on certain websites we investigated all displayed the Olympic branding TOKYO 2021. However, despite being held belatedly this year because of the COVID pandemic, the Tokyo Olympics retained TOKYO 2020, precisely because merchandise with the 2020 branding had been manufactured prior to the delay. Therefore, any merchandise bearing 2021 in the labels was quickly identified through automated means and was presumed to be suspect. To date merchandise bearing Tokyo 2021 is readily available on major marketplaces such as Aliexpress, Wish, Dhgate, ebay and Amazon. Discrepancies in branding and use of marks such as the TOKYO 2020 logo were also found to be compromised during our investigation.

There are many technological advancements such as product clustering, geo location mapping and machine learning based algorithms that can be used to find products compromised in the various marketplaces, discover major networks of illicit traders, and find many other forms of IP infringement. Once infringements such as the examples used above for the Tokyo Olympics are identified, viable and rapid action including shutdowns can be taken against the perpetrators, holding them accountable for their actions and helping to further prevent unauthorized products from being placed on the market.

To learn how Authentix Online Brand Protection Services can quickly work for your company’s on-line monitoring and enforcement needs, visit our website.

Part 6 of the ABC’s of Brand Protection series by Authentix focusing on the global scope of the counterfeiting epidemic and how to take action against it to protect your brand, your customers and your revenue.

The ubiquity of publicly available digital, manufacturing, and printing technology has enabled criminal enterprises to produce convincing but dangerously inferior counterfeit products.  Not only do these nefarious organizations damage the brand value of your legitimate products, they can create consumer mistrust, physically injure or even cause death. Those behind many counterfeit operations make millions in profit without regard to the investment you have made or the adverse effects on consumers.

To protect your company and your investment in high value products, brand owners must create a culture of risk assessment and leverage a security solution partner to monitor supply chains to detect, measure, act, and constantly refine the brand protection policy. This means not only developing the program and assigning responsibility to certain stakeholders in your organization but also selecting and working with a trusted security solution partner for risk assessment and deploying innovative technologies and overall program management.  An experienced solution provider will not push a single technology platform, but instead offer a suite of technologies that include a digital cloud platform for data collection and insights to help build trend analysis, track ongoing targeting, and leverage resources for a more effective outcome.  Creating this umbrella of protection that feeds digital insights that initiate action and remediation must be a part of the future for effective brand protection.

Artificial Intelligence and Machine Learning

While still in the early days of adoption, artificial intelligence (AI) is already being applied in some areas of brand protection. Using machine learning, for instance, computers can analyze and learn from large, complex datasets, recognizing patterns that reveal potential fraud or diversion. Packaging can be analyzed along with data compiled from sensors. Anomalies the human eye cannot see can be detected and exceptions can be flagged.

Data and Digital Platforms

It has been said that data is the oil in the engine of many business enterprises today. Despite this, only a few organizations effectively apply this to brand security. Over the next few years, this will change as many experienced security solution providers like Authentix, change the way data is collected and managed for the purpose of product and supply chain security.

Many companies have invested in supply chain and inventory management systems to collect data and optimize inventory management and manufacturing. However, the integration of brand security into this process is often overlooked.  Thus, many brand owners use bespoke physical security mechanisms such as holograms, license keys, and UV inks to manually detect problems in the post manufactured distribution channels. Moreover, as data collection technology improves and is more available to consumers via the ever-present smartphone, more brands may be able to actually integrate the reciprocal interaction with consumers via smartphones and products to begin the awesome scope of data collection towards the point of sale.  These days, more smartphones are capable of image and code collection at high resolution with native and downloaded applications for digital interaction with products and manufacturers.

Engaging with consumers via product interaction is not new. Certainly, many consumers have been scanning QR codes for years to gain more detailed product information, see other products in the lineup, and to take advantage of rewards and discounts. However, with many manufacturers, using this consumer interaction to authenticate legitimate from counterfeit or diverted products is tricky to say the least.  Therefore, using multiple layers of digital collection capabilities and correlating the data over time is the best approach. This may include a digital collection increment by inside inspectors who are querying for a graphic security feature using a proprietary mobile application.  This will immediately attest to UID level authentication and traceability or provenance. Alternatively, consumers may inquire directly via a QR or NFC basis. This would require no special mobile application but provide important geography, distribution, duplicate code, and transactional data that can help regarding distribution and transactional point of sale feedback, thereby securing the supply chain.

Right Data, Right Time

Having the right data at the right time will speed reaction times, enable faster diagnosis of issues, and deliver a more complete understanding of what specific corrective actions are needed and when. For instance, the DigiTrax™ digital platform is a cohesive data repository and dashboard interface that enables the collection, storage, and analysis of secure transactions to help companies make informed decisions on brand protection issues. DigiTrax™ is a secure, comprehensive, cloud-based, end-to-end platform designed to deliver a complete picture of your authentication and consumer interactive transactions and correlated results. It also is configurable to be customized to each client’s needs for detection, measurement, and targeting for unauthorized product placement and helps to form policy on corrective actions and investigations.

If the past is a prologue to the future, a tsunami of counterfeit goods continues to make its way into the global marketplace – from products such as luxury items, medicines, food, spirits, auto parts, and many more. The damage from illicit and fake products can cause nearly incalculable damages, including loss of human life, lack of consumer trust and the overall devaluation of your large brand investment.

So whether you choose to invest in the latest emerging single technology as a “one off” approach or you choose to select a fully integrated solution provider with a full technology suite – it is important to remember that ultimately, it is how you take action on the information retrieved from the security solution that ultimately determines how effective your product protection effort is. Risk will continue to grow as the arsenal of tools that criminals gain access to continues to expand. Stay ahead of the game and consult with a security solution provider who has the experience handling rapid deployment to help you migrate your organization to a digital platform as an ultimate component for brand enforcement strategy.

For more brand protection basics – why it is necessary, how it works, who is vulnerable, how to implement an effective program, what to look for in a technology partner, and which emerging technologies will make a difference in the future – download the eBook, The ABC’s of Brand Protection.

READ PART 1     |      READ PART 2    |    READ PART 3    |    READ PART 4     |     READ PART 5

Part 5 of the ABC’s of Brand Protection series by Authentix focusing on the global scope of the counterfeiting epidemic and how to take action against it to protect your brand, your customers and your revenue.

The current counterfeit landscape is a “not if, but when” environment. At some point, brand owners will experience an unauthorized product in their supply chain.  Given this inevitability, your product security strategy should be thorough, with a strong emphasis on implementation planning to enable detection of problems and action to mitigate and manage accordingly. One of the most effective deterrents to risk is teaming with a partner with the requisite skills, experience and talent to assist you in all facets of brand protection.

Qualified brand protection partners understand what you’re up against and can work with you to develop, implement, and manage a proactive strategy to help insulate your company against illicit trading of diverted or fake products. What should you look for in a partner? The following are key considerations when you are vetting an authentication solution provider:

1. Your business is their business

Choose a company that understands your business and offers consultative services—not just a technology.  It’s critical that they have experience relating to your industry and are quick to understand the challenges you face.  Experienced solution partners ask the right questions to help you articulate your exact concerns, assess risk, and work with you to set realistic goals for your program.

2. Thorough risk assessment plan

Determining the appropriate level of security required for a given product requires a thorough risk assessment strategy. The strategy provides insight into the risks in the market, the nature of product distribution, complexity of the supply chain and the goals for the brand. The appropriate security level depends on the exposure to counterfeiting and the value of the product to the brand owner. Determining the appropriate scope of protection, budget, and level of security necessary to mitigate the perceived risk is not a “one size fits all” approach and may differ from product lines and geographies.

3. Customized solutions

Qualifying a security solution provider also means finding one with the ability to customize tools and implementation plans to fit the unique challenges of your industry and company. For instance, your partner should have expertise in the types of product packaging, printing, manufacturing, and existing supply chain attributes to know what existing substrates, inks, adhesives, varnishes, and enclosures used already would be the best vehicle to roll out a covert security feature quickly.  Ask them if they offer:

• State-of-the-art covert and overt inks or marking systems
• Multilayered security features
• Monitoring and enforcement plans
• Ability to financial support the inventory and other requirements
• Implementation services, trial printing programs, evaluation of existing processes
• Data capabilities – dashboards, cloud platforms

4. Multilayered approach

Decades of experience have proven that there is not a simple “silver bullet” technology that can be applied in all situations for a perfect brand protection strategy. A multilayered approach in which overt, covert and forensic features are applied in various ways is often the most effective long-term solution against counterfeiting. How much experience does the security solution provider have in this area?

5. Supply chain integration

More than likely, your current supply chain is complicated and lacks visibility at various points. An effective security solution provider should be able to integrate within that chain without causing disruption to the existing processes. In addition, the partner should be agnostic without any prejudice towards a given technology and be willing to use a suite of options to consider. The best partner will be able to objectively analyze the situation, identify and help you determine risk, and recommend multiple scenarios for your consideration.  Each situation is different – beware of single technology solutions offering only one type of choice to solve.

6. Print trials and authentication support

An experienced security solution partner should be able to certify and ensure security mandates for your vendors. All manufacturing and handling of security materials should be completed in a secure facility under full chain-of-custody and auditing.  A security audit is often the best way to determine this. The brand owner should understand that appropriate physical security and auditing procedures are maintained for the benefit of all parties. It is important to only work with a partner with quality accreditation appropriate for the subject matter and technologies involved.

7. Talent and reach

Your security solution partner should have technical and commercial teams to provide the appropriate level of expertise required to authoritatively advise on the features of their technology and implementation. In the case of a global brand, your partner should have a global footprint and reach. This includes delivery, logistics, servicing, technical support, customs handling, and regulatory knowledge to properly handle regional and country-based compliance issues.

8. Proven implementation strategy

Some companies might be great at strategy and planning but drop the ball when it comes to implementing those plans. It’s important that a partner provides extensive documentation of their experience implementing programs, including a resume consisting of several multi-year customer relationships. In addition, any qualified provider should agree to become an integrated part of your team and extend that support to your third-party vendors.

9. Committed partner

The right security solution partner for you should see you through the good times and the challenging ones, too. You deserve an ongoing relationship with a select team of people committed to help stay steps ahead of potential risks and actionable plans when those risks become realized.

For more brand protection basics – why it is necessary, how it works, who is vulnerable, how to implement an effective program, what to look for in a security solution partner, and which emerging technologies will make a difference in the future – download the eBook, The ABC’s of Brand Protection.

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