Category: Commercial Brand Protection

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.

From Risk Identification to Full Implementation

Part 4 of The ABC’s of Brand Protection series by Authentix focusing on the global scope of the counterfeiting epidemic and how to act against it to protect your brand, your customers and your revenue.

In articles 1, 2 and 3 of this series, we’ve discussed the vast scope of the global counterfeiting problem, the tactics used by counterfeiters, and security features used on many products today to detect and mitigate these compromises. You are aware that this is a massive problem but how do you determine if your products are at risk? Understanding and assessing these risks is the first vital step to start mapping out your company’s action plan, resulting in an effective brand protection program.

Five Steps to Determine if Your Products are at Risk

1. Identify the risk areas

First, develop a risk inventory for your product line. The level of risk might differ depending upon supply chain complexity, geography, price point, margins, and anticipated demand. Consider these questions to identify vulnerabilities:

• Is my product line high volume with a low variable cost to produce?
• Are these products sold at higher price points and gross margins?
• Does my product line have an existing or potentially large market share?
• Does my product line and/or packaging currently have covert or overt security features that are economic deterrents to prevent counterfeiting?
• Do we sell through a complex supply chain and lose visibility to the point of sale?
• Are any of these products sold online or manufactured in countries without stringent counterfeit enforcement laws?

2. Assess risk

Determine the likelihood, impact, and overall threat of each risk factor. How susceptible is each product in your portfolio for attempted compromise? Use this information to create a portfolio of the higher risk products which includes:

• Aggregated risks – score each product with weighted indicators to prioritize by risk potential
• Map of the supply chain environment – what are the highest points of exposure and where do we have access?
• Potential short- and long-term damage – Consider:
  • How could adverse events of illicit supply affect consumer trust in your brand?
  • What about liability from health issues caused by compromised product?
  • How much market share and revenue dilution could be happening?

3. Develop a risk management strategy

Examine the results of your risk assessment to create an integrated strategy for each high-risk product that includes potential solutions to address all the foreseen threats:

• Adopt a defined set of policies and procedures where your stakeholders are aligned
• Look at available solutions to address specific product risks by threat area; for example – consumer safety vs. losses from diversion activity
• Address what actionable steps can be taken at the physical points in the supply chain where threats are the greatest
• Play out each risk scenario and escalation possibilities for contingent action upon the event including communication strategies
• Prepare a budget to implement solutions based on your assessment

4. Create an action plan

Responses to the most pressing threats can now be put into action by organizing management, information, and technology solution partner(s). Your action plan should include the following three categories:

• Detection and Deterrence – solutions that provide detection of a non-authorized product in the supply chain, proactive awareness campaigns, investigatory procedures upon detection, vendor agreements that include security policies for handling or manufacturing higher risk products, and unannounced audits of downstream distribution partners.
• Enforcement – the pre-determined action you plan to take upon the detection of an adverse event. This might depend on the event’s geography, supply chain level, and the resources you have allocated for enforcement.
• Prosecution – plan the specific steps that will be taken to support investigative and forensic efforts upon the discovery and confirmation of responsible parties. In some countries, enforcing your supply agreements against offending distribution partners might be a better course of action than criminal prosecution.

5. Monitor risk and continually re-evaluate your strategy

The last step in your strategy is a closed loop. Constant review of your data analytics offers an opportunity to better understand changing risks, increased or decreased vulnerabilities, and allows you to refine your actionable policy proactively. Today, data visualization coupled with a strong physical security element is even more critical in the fight against illicit product placement activity.  Analyze and act on these insights revealed in the reporting information– from new counterfeit hot spots to changing risk as time evolves.

The fact is no one solution or security measure will be the panacea to address all instances of product compromise across the global marketplace. However, as a brand owner you can assess these risks and select the right security solution partner(s) to help minimize the damage and keep you in charge rather than being in a reactionary stance. Also, it is important to select solution partners with lengthy experience in multiple industries who can offer a full suite of technology and service solutions that can both be rapidly implemented and scale to your business needs.

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.

Download the eBook

READ PART 1     |      READ PART 2    |    READ PART 3

Part 2 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.

By the Authentix Brand Protection Team

Brands are working harder than ever to provide transparency into their business practices. The customer trust and loyalty that this creates is invaluable and the holy grail of marketing departments. A sure-fire way to destroy that trust is to be subjected to counterfeit controversy – product falsification, consumer harm, or news of legal action against a brand can prove toxic to any popular brand.

Organized criminal enterprises have developed sophisticated networks of willing players throughout the global supply chain in practically every industry to cause such destruction. Some of their tactics include:

• Counterfeiting
• Diversion
• Tampering/Reuse
• Adulteration

Today, companies expand their operating and delivery efficiencies at lower costs with high-quality manufacturing available around the world. However, that innovation comes at a cost by enabling undetectable counterfeit goods to make their way into the supply chain. Buzzworthy brands with growing demand, celebrity clout and premium price points are most-targeted. The resulting inferior quality and/or faulty parts lead to consumer dissatisfaction, recalls, and major safety concerns.

It’s not just back alley transactions and big city flea markets that you need to worry about anymore. The rise of digital marketplaces such as Amazon, eBay, and Etsy (plus countless others that emerge each year) enable and accelerate sales of knockoff goods not only to willing buyers, but unsuspecting ones as well. In fact, according to a 2018 study by the U.S. Government Accountability Office, about 40 percent of a sample of goods bought on popular eCommerce websites were fake. Data collected by the U.S. Customs and Border Patrol between 2000 and 2018 shows that seizures of counterfeit and pirated goods at U.S. borders, much of destined for e-commerce channels, has increased ten-fold.

It is forecast that by 2022, the negative impact of counterfeiting and piracy will drain US $4.2 trillion from the global economy and put 5.4 million legitimate jobs at risk. This impact cuts a wide swath across many industries and businesses including:

• 
  Pharmaceuticals and OTC Medicines: At least one million people die each year after consuming counterfeit medicines.
• 
  Tobacco: If the global illicit trade in tobacco was eliminated, governments would gain at least US $31 billion in additional taxation revenue. Curbing this illicit trade could save over 160,000 lives annually by 2030 and beyond.
• 
  Spirits and Premium Drinks: Counterfeit or illegal alcohol, recognized as “unrecorded” alcohol, is not monitored for quality or taxation. The WHO estimates that 25 percent of the alcohol consumed worldwide is unrecorded.
• 
  AgroChem: The WHO estimated that counterfeit and adulterated pesticides poison over three million people⁷ annually and result in over 200,000 deaths mainly in developing countries due to unregulated trade enforcement.
• 
  Health & Beauty: According to the FBI, counterfeit cosmetics have contained adulterants such as paint thinner, which irritates the eyes, nose, and throat in addition to being flammable and poisonous.

 

In this climate, many companies are thinking more broadly about how to implement coordinated anti-counterfeiting and anti-diversion strategies across their brands and throughout different regions of the world. Just as tamper-evident seals on bottles of pills and liquid formulations became more common after a tampering scare in the 1980s, attitudes toward anti-counterfeiting technologies are beginning to evolve.

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 help protect your brands in the future – read the The ABC’s of Brand Protection.

Download the eBook

Part 1 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.

By the Authentix Brand Protection Team

The negative impact of counterfeiting and piracy is projected to drain U.S. $4.2 trillion from the global economy and put 5.4 million legitimate jobs at risk by 2022.¹ Are your products protected? They need to be.

If anyone of us were to think about the purchases we made over the years, we’ve probably purchased a counterfeit good. It’s estimated that more than 80 percent²  of all global consumers have unwittingly purchased falsified products. This concept is proliferated by the ever-growing global supply chain and all its complexities that foster an environment lacking required ingredients, quality control, or government oversight. To get ahead of the counterfeiters, brand owners need a brand protection program to shield what matters most to your business – customers, brand, and revenue.

The gaps in the system are magnified even more during a pandemic. In the same week COVID-19 was declared a pandemic, a fake and dangerous rendition of a popular potential therapeutic drug with a street value of more than $14 million was seized by Interpol⁴ . It’s time to sound the alarm. No one industry is immune to such calculated nefarious acts. Brand owners from health and beauty, food and beverage, pharmaceutical, to apparel experience financial losses and more importantly, added risks to consumer health and safety.

The good news is that today’s anti-counterfeiting solutions to detect and deter fraud are growing more sophisticated, affordable, and accessible. The benefits of a strong brand protection program are three-fold:

1. Protection of the brand owner’s livelihood – namely its reputation and investments into market-leading proprietary products.
2. Consumer protection – no brand owner wants their name associated with health hazards or calamities resulting from brand compromise.
3. Corporate citizenship – proactive companies that deploy product protection programs and are serious about a no-compromise climate are more responsible corporate citizens. This leadership and transparency can contribute exponentially to customer loyalty as it humanizes the brand.

CONSIDER THIS: The global economic value of counterfeiting and piracy could reach U.S. $2.3 trillion by 2022.³

Do you have a strategy in place, with policies and dedicated infrastructure to combat product fraud? Maybe you partner with a trusted third-party technology and solution provider. Maybe you don’t yet have a brand protection program in place. No matter your approach to the counterfeiting issues, knowledge is power.

Counterfeiting is real and impacts everyone in the supply chain. This article addresses a single layer of the importance of brand protection programs. We have more facts, figures and trends in our latest eBook, The ABC’s of Brand Protection. This eBook offers a crash course in how brand protection 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.

Sources
1. https://iccwbo.org/media-wall/news-speeches/global-impacts-counterfeiting-piracy-reach-us4-2-trillion-2022/
2. https://www.dhs.gov/sites/default/files/publications/20_0124_plcy_counterfeit-pirated-goods-report_01.pdf
3. https://iccwbo.org/media-wall/news-speeches/global-impacts-counterfeiting-piracy-reach-us4-2-trillion-2022/
4. https://www.bbc.com/news/health-52201077