Counterfeit products not only result in lost sales for your business but have the power to destroy your brand reputation and market trust. With such high stakes, brand protection from counterfeiters becomes an essential part of your market strategy, and not just an afterthought. Here’s a guide on how to protect your brand from counterfeits, so you can safeguard your business as well as your consumers.
Today, counterfeiters have access to the latest technology to help produce counterfeit products that look almost exactly like the original one. What’s more, the counterfeit problem has become worse with the rise in online sales and commerce channels like Amazon and eBay.
Counterfeiters are now able to fool consumers more easily by fake pictures of products along with nearly-perfect product replicas. They can also use a technology like geo-adaption which makes it difficult to identify the culprits and online sellers of the fake products. This way, the counterfeiters are able to prevent law enforcement.
In such a scenario, your brand needs to take strong steps to protect your business and consumers against counterfeiters. One of the easier options is to make your products almost impossible to counterfeit. You can do it by implementing the best anti-counterfeit technology suited to your product type, and prevent fake sellers from targeting your brand.
Why do you need to protect your brand from counterfeits?
Protecting your brand from counterfeiters is important because the impact of counterfeiting is long-lasting on your brand reputation and revenue.
The impact is twofold: direct impact and indirect impact from counterfeited goods. Direct impact is the loss of direct sales when consumers buy a fake product instead of the original one as well as the loss of trust from the consumers.
The more dangerous is the indirect impact. If your brand products are being regularly counterfeited, your brand reputation will slowly start decreasing as consumers expect strict action against counterfeiters from businesses.
How to protect your brand from counterfeits
Before applying any anti-counterfeit technology, make sure you cover your bases in terms of legal rights. You can start by registering your intellectual property rights wherever possible. That includes creating a trademark, copyright, patent, or any trade secrets.
This will make sure you have a legal standing to report counterfeiters based on infringement of the trademarks, copyright, or intellectual property.
Next, your brand protection strategy must be holistic, covering multiple threats. The following steps may help you create your own brand protection program, perfectly adapted to your specific needs.
- Start small with select products
- Decide the end user of the authentication technology
- Define your brand’s major problem
- Decide if the protection feature needs to be visible or invisible
- Decide if you will authenticate the product or its packaging
- Always add your brand logo to your products
- Talk with the reference customers of your potential supplier
- Give your anti-counterfeit supplier the freedom to operate
- Make sure your anti-counterfeiting effort doesn’t indirectly result in a decreased profit
Step 1: Start small with select products
Based on our experience, companies that want to protect all their products at the same time take longer to implement a viable solution. This results in high-risk products not being protected while they could have been; had the protection scope been more restricted.
AlpVision’s advice is that you identify your highest-risk products and start the review of the available brand protection solutions with those products in mind. Later on, you can use the Pareto law and preselect solutions that would apply to 80% of your products.
Step 2: Decide the end user of the authentication technology
Very often, we see customers wanting to cover all the possible use cases. However, the challenges are different when a technology has to be deployed to the general market or to a set of trained users. Defining the scope before beginning the brand protection project is important to avoid some gold plating. The different users could be:
- Experts for internal business use (shop inspections, …)
- Law enforcement (customs, …)
- Consumers (Self-check)
The decision regarding the user of the authentication technology is critical as it impacts the authentication feature, deployment strategy, operational cost, and effectiveness. We have often observed that a system deployed for the business’s internal or expert use is more effective and has lower costs.
Step 3: Define your major problem
In some industries, counterfeit is the biggest issue; i.e. you need to quickly be able to identify whether a product is genuine or fake and you want a solution that makes it hard to replicate. In other industries, the gray market is a bigger problem as you may lose even more sales with genuine products that are not sold in the proper country.
AlpVision technology services are perfectly suited to solve gray market issues as well as standard counterfeit issues, whereas other solutions might not be.
Step 4: Decide if the protection feature needs to be visible or invisible
There are two types of anti-counterfeit features for brands: visible and invisible.
The advantage of visible features is that your business customers will be reassured since they can see the security feature. On the other hand, with a visible feature, counterfeiters know what they should target. Plus, if you choose a visible feature, you will be locked into it almost forever as your customers might get used to it.
The bottom line is: if the feature isn’t verifiable using software, it will be easily counterfeited.
Also, it’s often difficult for users to verify the authenticity of visible authentication features through visual inspection. For instance, it’s difficult for users to distinguish real from fake holograms. This can be mitigated if the authentication is done via software as it could take advantage of AI to increase security as in AlpVision’s Secured QR code technology. The advantage of an invisible covert feature (such as Cryptoglyph or AlpVision Fingerprint) is that it’s extremely secure.
Step 5: Decide if you will authenticate the product or its packaging
There is no right or wrong answer here.
Of course, authenticating both the product and its packaging would be more secure. But we strongly advise you to start simple and shoot for a fast launch. The advantage of authenticating the product itself is obvious; it removes the risk of refill. On the other hand, If you start by authenticating the packaging, the authentication can be performed in shops without even buying or opening the products.
Step 6: Always add your brand logo to your products
Your brand logo has legal rights. Therefore, if it can be added directly to your products (for example molded in plastic caps, stamped on pills), it will prevent fake sellers from copying it. In case of a counterfeit incident, you can report it to law enforcement authorities under intellectual property (trademark logo) infringement.
This is already a first level of protection as there would be a higher risk for the counterfeiter to copy your goods than that of your competitors. Please note that incorporating the trademarks into the product makes it more efficient than simply putting them on a label.
Step 7: Talk to the reference customers of your potential supplier
Most of your potential suppliers will tell you that they cannot give you the names of their customers. This is, of course, a respectable attitude as it protects customer privacy and hence increases the security of the overall brand protection strategy.
Nevertheless, most of your counterparts will agree to talk with your team responsible for brand protection strategy. Indeed, even if the companies compete with you on the products or services they are selling, you share common interests to protect your industry.
At AlpVision, we may be able to put you in contact with reference customers at some point in the bidding process time. Of course, this is best done as the procurement negotiations become advanced to better protect our current customers.
Step 8: Give your anti-counterfeit feature supplier the freedom to operate
Over the last few years, we have unfortunately seen some providers of brand protection solutions claiming to be sellers of solutions for which they have no patent or, even worse, that infringe another patent.
Selecting one of those suppliers can be problematic from a cost perspective as they could be discovered at some point, and would need to pay for the legal rights to operate. This could result in an increase of your costs or a bankruptcy of the company, which would mean that your whole brand protection strategy would need to be rethought.
Step 9: Make sure your anti-counterfeiting effort does not indirectly result in a decreased profit
This would be a shame if your efforts to protect your brand from counterfeit result in decreased profit. Below are 4 important points that you should have in mind while selecting the most appropriate strategy:
- Implementation of the technology may burden or decrease your manufacturing productivity.
Please note that all AlpVision anti-counterfeiting solutions and technology are thought to avoid this problem. - Talking about counterfeiting may frighten your customers.
In that case, you may want to opt for a solution that is solely reserved for experts (read Step 2). - In case the anti-counterfeiting feature does not work as expected, you may be flooded with consumer requests wrongly suspecting they have a counterfeit, which at the end of the day costs you more than counterfeiting.
Selecting a feature that is easy to detect as well as starting small (read Step 1) would help mitigate this point. AlpVision anti-counterfeit solutions can be easily detected with a smartphone. - In case you need special consumables, the cost of applying the feature will grow linearly with the volumes.
AlpVision Solutions makes use of your standard consumables. Yearly license is a royalty to have the right to use the solution and therefore, even if it is indexed to the number of produced products, its cost won’t grow linearly.
The ultimate question is which anti-counterfeiting technology is best for your unique product and market. As discussed, your selection of the technology depends on a lot of factors. Here’s a whitepaper that dives deep into the available technologies and how to select one for your business.
Download your Whitepaper