Why retailers and IP rights holders must be extra vigilant during the holidays
The biggest shopping period of the year is in full swing and retailers around the world are predictably busy preparing for the final rush of sales during the Christmas and New Year holidays. However, merchants should not just be focusing on their stock, promotions or staffing – you should also be protecting your brand online.
Because, like it or not, counterfeiters are equally excited for the holiday sales surge - by piggybacking on promotions by IP rights holders and selling fake products in plain sight on online marketplaces.
Impact of Counterfeiters on Commerce
Global trade of counterfeit goods reached $1.2 trillion in 2017 and is projected to grow to $2.3 trillion by 2022 – that’s almost as large as the GDP of the United Kingdom. Speaking of the UK, the OECD noted in their annual ‘Trade in Counterfeit Products and the UK Economy’ report that fake goods not only affect IP rights holders, but they also harm public finances. Counterfeit goods caused the British economy tax revenues worth in excess of £4 billion in 2016 and were responsible for over 86,000 lost jobs in the same year.
Educating consumers and preventive strategies
Consumers will definitely spend hours looking for the best deals online while doing their Christmas shopping. Amidst the various promotions and discounts, it would be easy for infringers to slip in their low-priced fake products. Since customers lack the necessary skill set and knowledge to identify the less obvious products, the onus is on the rights holders to allocate resources to scrutinise online marketplaces and identify rogue merchants.
Why businesses must be proactive
Every dollar, pound and euro earned by counterfeit syndicates can strengthen their organisation and enhance their distribution network; and every purchase of substandard products could further normalise the behaviour of buying fake goods among the populace.
But the worse thing is, fake goods purchased by unknowing victims often negatively affect the perception of legitimate brands. The substandard quality of fake goods like toys, cosmetics and electronics can expose consumers to health hazards which, in turn, might even expose rights holders to civil litigation.