Page 148 - EM - Export Magazine Perfumery Edition

R E P O R T

Along with the rise of the e-commerce industry, comes the to set themselves up as a seller and there’s very little due
shift of marketplace for counterfeit goods. Fakes are less diligence, so the onus is really on the consumer to do their
frequently sold on street corners and flea markets and research,” says Rachel Jones, founder of brand protection
instead are found in online marketplaces. The transition software Snapdragon.
to online shopping has made it more difficult not only for In the past, it may have been easier to spot counterfeit
e-commerce companies, but also for consumers to identify items with obvious dodgy packaging, spelling errors, and
the characteristics (appearance, price, and location) that blurry images on product or website pages. However,
are typically associated with counterfeit goods. counterfeiters have become highly sophisticated. With
IP and brand protection company IncoPro found that 52% advances in technology, it’s easy to manufacture copycat
of consumers lost trust in a brand after purchasing a fake packaging. They often combine these efforts with copyright
good online, while 64% lost trust in online marketplaces. theft of a brand’s imagery and sell goods via social media
This led Nike to stop selling its products on Amazon. and fake websites. Thus, counterfeit beauty products
Red Points (a brand-protection agency), works by finding find their way into the hands of even the most discerning
and sending ads and listings on online marketplaces to customer.
brand executives who then confirm or deny the legitimacy
of the listing or vendor. In the first half of 2020, fake product
sales were up by 56% across hundreds of brand clients for what can brands do to better protect
Red Points. The same year, Red Points started working themselves?
on removing 11,000 fakes sold across 180 marketplaces. Online brand-protection companies like Red Points and
Daniel Shapiro, vice president of Red Points explains, Snapdragon, focus on identifying copycat products online
“Counterfeiters always seize on opportunities for growth, and taking them off the marketplace(s). But up until recently,
and with e-commerce sales booming, the pandemic was there wasn’t a way to verify an actual product. That has
one of those opportunities.” According to Shapiro, post- changed. Beyond encouraging consumers to shop only from
pandemic, haircare brands, cosmetics, and skincare tools official retailers, like the brand’s own website or a chain like
have been hit especially hard. Sephora, brands can employ covert packaging features, such
Since the pandemic began, online beauty sales have grown as: invisible or UV inks, invisible watermarks, ink taggants,
by 20-30 percent, according to research from McKinsey, and infrared ink. But how do these features work exactly?
and marketplaces that are prone to counterfeiters, like We’ll look at a best-in-class example in order to illustrate
Amazon and eBay, are seeing sales gains. Furthermore, the the advantages of choosing this type of anti-counterfeit
popularity of social media and e-commerce has made it measure, before going through a list of considerations a
far easier than ever for counterfeit producers to distribute brand needs to assess when choosing an anti-counterfeit
their products through mainstream channels. Social media, partner.
in fact, contributes to above 50% of counterfeit cosmetic
sales. Examples of anti-counterfeit (packaging-Based) solutions
Amazon and eBay state they have taken a stronger stance include:
against fake products in recent years. Amazon, which • Invisible inks
now accounts for a third of online cosmetics sales in the • Microtext (only visible under magnification)
U.S., reports that it spent over $500 million and relied on • Holograms, specialty foils, specialty inks, and other
8,000 employees in 2019 to fight fraud and counterfeit complicated builds that are difficult to replicate (a similar
products on its platforms. eBay, meanwhile, launched concept used on currency)
eBay Authenticate in 2017, an authentication service that • Variable printing for unique lot number tracking
was only available for brands selling handbags and wallets • Unique laser cutting of tiny shapes or images into the label
over $500, but discontinued the service. Shapiro, who • Tamper-evident labels of many varieties: Shrink sleeve,
formerly worked at eBay and helped the company create pressure sensitive and film labels to create a seal over
its first brand protection team, believes that relying on product openings, labels that leave behind a message or void
marketplaces alone to solve the problem is unrealistic. materials when peeled, tamper-evident pallet banding for
“The teams focused on this at Amazon or eBay just aren’t bulk authentication, or NFC tamper-evident tags
going to know every single brand being sold that well, so • QR codes and much smaller 2D barcodes
how can they weed out all the counterfeits when they don’t • RFID taggant
know what to look for?” Experts say another way to battle • RFID/NFC blockchain
counterfeiting must be found. “It’s so easy now for someone • NFC tags and QR codes for consumer digital authentication

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