Fighting Counterfeit Goods: A Corporate Responsibility
According to a report commissioned by the International Trademark Association (INTA) and the International Chamber of Commerce, the global economic value of counterfeited and pirated goods could reach $2.3 trillion by 2022. Whilst that number is staggering, many organisations are looking to increase their anti-counterfeit measures, rather than being lumped in with the trillions in lost revenue.
Governments in countries where many counterfeit goods originate are taking action and e-commerce organizations—such as Alibaba— are taking steps to fight counterfeit sellers on their network. However, the messaging is clear: the distribution of counterfeit goods won’t decrease any time soon, so it’s best to safeguard yourself and your business immediately.
One major reason for the uptick in counterfeiting is the sheer size, diversity, and unregulated nature of the internet, exposing brands to numerous threats. It takes seconds to register a domain name or social media username with few mechanisms in place to prevent someone from immediately infringing on a trademark or other intellectual property. Additionally, copycat websites or mobile apps can be built in a few hours—and mobile, in particular, is a difficult channel to watch.
More than half of all web browsing now happens via phones, and they’re increasingly used to make purchases. But those smaller screens and on-the-go engagement may leave consumers more prone to being duped. Social media, auction sites, and online marketplaces are all viable alternatives for fraudsters in a hurry.
The state of play in online counterfeiting means that no brand can afford to underestimate the sophistication of the fraudsters now exploiting the digital world. They have already proven their skill at adapting their tactics to exploit the online environment, migrating to cyber crime and information theft when it proves more lucrative, and even using the same channels as the genuine brands to market their goods.
Fighting the Fakes
There are many reasons why consumers buy “fake” goods. Some long for luxury goods they cannot afford, while others purchase fake creams and cosmetics without ever considering the risks, and still others buy health products online without actually examining the full implications of fake goods.
The fact is, you can type in any highly recognizable or popular brand name paired with the word “cheap” in a search engine and instantly find at least one site that sells counterfeit goods. Most consumers prefer a more attractive price for a product as opposed to paying full price. Also, the internet gives us all the opportunity to do this without leaving the comfort of our own home, and counterfeit sellers not only know this, but will use their insight to con people with fake goods.
With so many consumers now unwittingly buying fake products online, brand reputations are being tarnished by counterfeiters. These bad actors can monetize a brand’s global prestige or force product recalls and liability claims by infiltrating supply chains. But apart from the economic consequences counterfeit goods have on a brand, there is a real risk for consumers: Counterfeit items do not go through the rigorous health, safety, and compliance testing that legitimate products undergo.
This serious, dangerous risks to consumers―as well as liabilities to the companies selling products― mean that fighting counterfeit is every brand’s responsibility. It’s crucial for brand owners to review their online strategy carefully―considering the internet is constantly evolving―and the best practices document, titled, “10 Steps to Tackling Online Counterfeiting,” can help you adapt.
Ask your current provider to help you develop or update your strategy by assessing the size of the issue and identifying which channels to monitor by providing the appropriate enforcement option and supporting documentation. By developing a proactive and effective anti-counterfeiting strategy, you can safeguard customer confidence, brand equity, sales, and revenue.