Business Law & Compliance
Top tips for fighting back against online counterfeiting
8 min read
28 June 2017
In a highly competitive market, brands are facing a growing challenge from online counterfeiting, with fake goods affecting bottom line, reputation and customer trust.
While genuine products at discounted prices can indeed be found on the Internet, consumers can often find themselves unknowingly caught out by goods that were the product of online counterfeiting.
The rapid expansion of online counterfeiting is put into stark perspective by the Organisation for Economic Co-operation and Development (OECD), which found that fake goods made up 2.5 per cent of all world trade in 2016. Financially, this equates to a total value of $461bn.
No industry is truly safe against the threat of online counterfeiting, and so it is up to legitimate brands to put measures in place that help protect both the company and the customers. But where should these brands begin?
1) Attain global visibility
Before a brand can understand the scope of the threat posed by online counterfeit sales, it must expose and quantify the problem. Counterfeiters operate over a wide array of online channels, and all of these must be monitored and analysed, including online marketplaces, social media, e-commerce sites and message boards.
Counterfeiters depend on technology to drive sales, so it is essential for any brand to build an accurate picture of the challenges they face, whilst applying the correct techniques and leveraging the technology available.
2) Monitor points of promotion
While it’s obviously important to identify and shut down distribution channels, it’s almost certain that counterfeiters will regularly seek new platforms to sell from. This can often include them using paid search advertising, links within social media, black hat SEO tactics, cybersquatting and spam to steer traffic to illicit offerings – diminishing the marketing ROI of legitimate brands. Monitoring for these promotional efforts is critical – and enables our next best practice.
3) Take proactive action
The only way to prevent counterfeiters from damaging your brand is to let them know that you are aware of their activity; otherwise they will simply continue operating unchallenged. Therefore, once brands have identified the channels and ways in which the counterfeiters in question are working, they must take aggressive action. All brands must:
• Set priorities. Identify the biggest offenders, offering the greatest number of counterfeit goods in the most highly trafficked channels, and address them first.
• Watch for cybersquatters. Brands should actively monitor the Internet for unauthorised use of their branded terms in domain names. This will aid in the rapid detection of e-commerce sites selling counterfeit or unauthorised goods – and frequently also uncovers other abuses such as false association with offensive content like pornography.
• Become a difficult target. Brands that vigorously fight to remove counterfeit goods from the varying online channels often see a dramatic drop in the amount of infringements against them.
• Use all your weapons. Most online channels provide mechanisms for dealing with counterfeit sales situations. Online marketplaces, for example, typically have policies and procedures enabling brand owners to report listings that infringe their brand.
• Get help from friends. Industry relationships can be powerful weapons in the fight against online counterfeiting. When choosing a brand protection solution provider, look for one with established ties with thousands of ISPs and Registrars worldwide.
4) Fight online counterfeit sales holistically
Online counterfeit sales are easier to address when the entire business participates. That means brand owners should set up a cross-functional task force to address the issue in a coordinated, holistic manner. Stakeholders – and, therefore, recommended participants – will vary by industry and enterprise, but can include legal, marketing, risk management, loss prevention, channel sales management, manufacturing, supply chain management and other functional units.
Because fighting online counterfeiting requires attacking both promotional and distribution channels, this group needs to address more facets of the problem than seen in the physical world.
5) Let online intelligence inform offline defence measures
Setting up offline measures to tackle counterfeiting – whether it be a physical investigation, a factory raid or otherwise – can be financially expensive and very time consuming, and so before carrying any of these out, brands must identify the areas on which they should focus. To do this, they should use online intelligence to find the most damaging individuals, which will consequently ensure that offline measures are far more effective.
6) Act swiftly – and globally
Perhaps even more than it affects legitimate business, the proliferation of international trade offers tremendous benefits to online counterfeiters. While a domestic seller or manufacturer may seem like an easy first target, brands have learned that it’s more effective to launch global anti-counterfeiting initiatives – and to get them underway expeditiously.
Prepare by ensuring your trademarks are registered internationally – especially in China, which observes a “first-to-file” policy that grants registration to whoever files first, even if it’s not the true brand owner. A global effort doesn’t preclude addressing markets that target a specific country exclusively.
In some cases, this will require competent language translation resources for monitoring, detection and enforcement. Most companies rely on third-party brand protection solution providers for this kind of expertise.
7) Educate your customers
Your customers can be an important ally in minimising sales of counterfeit goods with all its associated costs. Educate your customers about the risks of buying from unauthorised sources, and recruit them to join in the effort by reporting suspicious goods and sellers. The Authentics Foundation and its consumer site, dontbuyfakes.com, have useful resources for consumer education.
Also, many brands provide form or email-based mechanisms for reporting suspected infringement. When offering such tools, be sure to reinforce the benefits of buying authentic goods from authorised sellers.
It’s important to remember that counterfeiting activity does not just impact your brand – it ultimately will result in a negative experience for your customers, too. Therefore, fighting back against the counterfeit challenge should be a top priority for all businesses. With a comprehensive brand protection strategy to their names, brands can ensure they guard their reputations and their revenue, while keeping customers engaged and satisfied.
Charlie Abrahams is senior vice president of MarkMonitor, a brand of Clarivate Analytics