Every consumer likes a bargain and they’re often willing to compromise on quality to save on price. However, those shopping shortcuts can become long-term hazards for brand value, the reputation of a product or company, and for society as a whole. Unfortunately, shoppers are more tempted and or vulnerable when buying online, a virtualized, often anonymous marketplace that offers more risk than reward.
Counterfeits Damage Brand Value
Waking up to the threat counterfeiters pose is a brand’s first step toward security. Thankfully, there’s already a significant degree of awareness among the world’s retailers regarding the dangers caused by counterfeit goods. This awareness is particularly high in the United States, which held the largest share in the anti-counterfeit packaging market in recent years.
Worldwide, that market is expected to hit over $248 billion in the next six years, huge numbers for an equally huge threat. Soon, fewer than 10 countries will have a greater GDP than the global counterfeiting market, which is expected to reach $1.82 trillion in 2020.
Even before online shopping, companies had to combat counterfeit goods in the market. But with the increase in online fraud and counterfeit goods, businesses face another challenge when protecting the integrity of their products and brand value.
Many consumers don’t realize the full extent of counterfeit goods in the marketplace. Cultivating and promoting awareness to the greater impact is so important because of these three very intertwined categories:
- Protection of individual or consumer interests
- Promotion of a more secure retail reality
- Creation of a safer society
Counterfeits and Online Shopping
Internet consumers often cannot spot counterfeits when purchasing and maybe even when, or if, they receive the product. Raising their awareness of the situation is a giant step towards protecting product value for brands, businesses, and buyers.
When counterfeiters attack it undermines a buyer’s trust, which quickly hurts online brand value. In the world of internet reviews, negative press spreads like wildfire and hits brand value hard. 93 percent of consumers say online reviews influence their purchasing decisions. Some shoppers are less scrupulous, but this isn’t good news for your brand either.
“Bargains” Can Actually Mean a Rise in Cost
Many buyers have few qualms about purchasing known or possibly counterfeit items if it will sufficiently boost their personal image. It’s more important than ever that the public and professionals realize this isn’t simply a cost-cutting situation that “only” burns the buyer and the brand. This “simple” cost-cutting actually increases costs for society as a whole.
The Cost of Counterfeit Goods
The United Nations warns that counterfeit goods are ranked among the highest income sources for organized crime. Furthermore, since these fake goods are often smuggled illicitly across borders, they illegally sidestep taxes and customs duties, which can rob a country of millions.
Internet crime also removes the haptic effect, which is the hands-on ability for a consumer to inspect goods for quality and legitimacy. By the time they’ve received their order, a no refunds/no return operation has already taken their money.
Because of these illegal activities from counterfeit organizations, there can be an increase in law enforcement budget to control these crimes and higher medical costs due to injuries from faulty products or fake medicines. This is also not including the fact that companies who wish to implement anti-counterfeit measures can potentially raise prices to help fund their security.
It just takes a few “bargain-hunting” consumers purchasing counterfeit goods to increase the cost for all of society and decrease brand value all at the same time.
The Importance of Product Protection
By incorporating anti-counterfeit product protection, companies can help limit the overall costs to all of society as it prevents injury from fake goods as well as removes the need for additional law enforcement.
Product protection requires several forms to be proactive against piracy such as counterfeit-proof labels, transport tracking, and measures to prevent copying. This relies strongly on how far brand owners are willing to go to implement these anti-counterfeit solutions.
Because there are additional costs and processes involved, companies looking for anti-counterfeit measures often make a classic mistake, implementing a single layer of product protection.
Product protection operates under the security golden rule; the more layers of protection, the better. Single-feature security is much like only having a password on your business’ data. Having one simple password guarding your data, wouldn’t perturb any hacker determined to access your business.
There should be multiple passwords for multiple users and multi-factor authentication for all.
Implement a Multi-tiered Anti-Counterfeit System
Just like hackers and one password protection, counterfeiters view single-level product security as little more than a speed bump. They’ll actively seek to bypass it through imitation or neutralization. True product protection lies in a blending of protective elements that suit each individual product and are also scalable against future threats.
There’s no better blending than the U-NICA approach, a cooperative think tank of universities, affiliates, and agencies who all committed to the shared goal of a fluid, evolving framework to combat counterfeiting from all angles.
Join U-NICA for Better Brand Protection
U-NICA is a team with a single purpose, supporting you in the fight to protect your brand’s integrity and value. Each anti-counterfeit strategy is geared specifically for every brand and product.
To learn more about U-NICA and how to protect your brand and products, download the scryptoTRACE® brochure — an End2End Brand Value Protection and product protection solution that can be integrated into all stages of the product value chain, from design and manufacturing to distribution, sales, and purchasing. Connect with a representative for more information on U-NICA’s constantly evolving open solution suite.