Just recently, in downtown Los Angeles, officers seized over $300,000 in counterfeit makeup coming in from China that looked nearly identical to the name brands. At best, these counterfeit cosmetics contain benign, lesser-quality ingredients than the name-brand items. At worst, they have been tested to contain dangerous chemicals and harmful bacteria detrimental to the health and safety of the consumer. Companies have a responsibility to protect their loyal customers from counterfeiters, protect their brand’s reputation, and protect themselves from financial losses.
This is just one of the latest examples of an industry plagued by fake products and lost sales to illicit trade. Cosmetics are an interesting problem, because many of the products have a relatively small size compared to their value. The real estate on which to carry serialization or overt authentication features – such as holograms – is very limited, and the product image and look are extremely important to marketing and brand differentiation. While the outsourcing of production to low-cost places like China has created economic benefits, they are to some degree offset by that same manufacturing capability being used to create large amounts of counterfeit goods of seemingly high quality.
But even the smallest of cosmetic products, like nail polish and lipstick, require some information to be carried for the consumer. There are several solutions through printing technologies to help with the easy identification of counterfeit and authentic product. These approaches, from overt color-shifting ink to covert markers read by proprietary devices, all offer the stakeholders in the supply chain an opportunity to authenticate goods easily and cost effectively. When supported by stakeholder education and product surveillance, these features are effective deterrents to counterfeiters who fear their illicit product may be identified and not be accepted into the supply chain.
The different types of features all serve a different purpose, from enabling consumers to quickly identify a branded product as genuine, to covert markings that enable a manufacturer to identify the source of diversion or other illicit activity. When combined with the careful design and production quality controls used in authentic product manufacturing, these features raise the bar of complexity for counterfeiters and make the product a less attractive target.
Solutions exist today to solve counterfeiting in the beauty and skincare market. It is just a matter of matching the cost of the solution with the value of the product. In our 25 years of protecting brands, we most often find that a multi-layered authentication solution works best. In the case of a $5 tube of lipstick, a simple overt solution for less than a cent per unit may be appropriate. In the case of a designer skin care product, a more robust solution is appropriate, which can be designed to enhance the brand image as well as brand protection. What is important is that they both be incorporated as a part of an overall brand protection program that includes monitoring and sampling retailers.
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