Real, multifaceted threats
Counterfeit sales, brand abuse, and online traffic diversion: just three areas where legitimate businesses see their brands, products and ultimately market share being undermined. We are increasingly seeing these threats as not only real, but also as global and multifaceted.
Counterfeit: fake products, real threat
The products are fake, but the results are all too real: lost sales and tarnished brand image – just two consequences of today’s substantial market in counterfeit goods and brand infringement. Counterfeit sales are now common in all product categories, and are estimated to account for between five and seven per cent of world trade, or USD 600 billion annually. Today, copies are often virtually identical to genuine products in terms of quality, and in many cases consumers are unable to determine whether products are original or copies.
In addition to lost sales and brand damage, counterfeit sales also create issues from a corporate social responsibility (CSR) perspective. Production of imitation goods often involves poor working conditions for employees, child labour and environmental pollution.
Cyber attacks and brand abuse by third parties to increase sales are huge problems, comparable in scale and impact to counterfeit sales. Trademark infringers flout the law by using brands in text, images and alongside their own logos in an effort to increase sales.
Design and patent encroachment can also be examples of IP and brand abuse. With the Internet as a distribution channel, the effects of brand abuse for brand and patent owners is often quick – virtually immediate in some cases – and global.
These infringements often take the form of unauthorised agents using brand and product names to sell their own, entirely different products, with the aim of misleading buyers to increase sales. Logos and copyrighted material are also used to further mislead consumers.
To maximise online sales, brands need to be skilled at driving traffic to their online channels, either via their own sales platforms or through retailers. The use of traffic diversion to mislead buyers by piggybacking on well-known brands to sell other products, including counterfeit goods, is increasingly widespread. Customers are misled throughout the buying process from search engines, market places and on social media.
Today, when a consumer gets a large amount of search results for your brand, he or she does not know which leads to a site where they are assured of buying original products, or perhaps isn’t even aware that fake versions of a product exist.
By using search words that specifically match your brand and your products, counterfeiters manipulate visitors interested in your brand and your products. An extremely large amount of these visitors fail to ever reach sites that sell your products.
We specialise in tracking, analysing and enforcing cases of online counterfeit product and brand infringement all over the world. We are dedicated to irradiating all counterfeit activity in the short- and long-term. That’s why
We Stop at Zero.
Parallel import refers to the import of branded goods into a market without the consent of the brand owner. These are not counterfeit products, but simply goods intended for sale elsewhere. Also referred to as the sale of “grey market goods”, this practice is legal in some jurisdictions but not in others.
Parallel import is a consequence of a principle known as the Exhaustion of Intellectual Property Rights. This states that once a product has been sold into a market, the owner of the relevant intellectual property rights must allow the re-sale of that product. This loophole allows less scrupulous re-sellers to exploit price differentials by selling branded goods at a discount in some markets – often at the expense of the authorised distributor and possibly in breach of safety, environmental and other standards governing the market they are being exported to.
China has a thriving grey market. Limitations on foreign imports create strong demand for certain products. This demand is given an additional boost by the lack of quality assured domestic products. According to research, some 60% of Chinese consumers say they are willing to pay more for products manufactured overseas.
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