“Never let a good crisis go to waste” – Winston Churchill.

A brand owner smiles, feeling proud of their brand whilst reflecting on the exceptional energy they have spent on building the brand’s equity. Their success and that of the brand, includes a complex weave of authenticity, creativity, consistency, discipline, sweat and sometimes tears. Extensive research, expensive budgets, clever strategy and clear values and purpose have built a brand and most importantly a brand-loyal consumer whose trust is earned. Another smile and a sip of good coffee!

In saunter the counterfeiters with a smirk on their faces, fake shoes and a copy-cat cap, carrying a plastic leather Italian-branded handbag full of blatant disregard for a brand that has worked so hard to establish itself as a leader. They are the middle-man, possibly one of many above and below them, funded by criminal kingpins who fund illegal businesses that sell far more dangerous goods than fake apparel. They are there to make a quick buck, however what sits behind the counterfeit is a complex chain of imposters.

It’s Saturday morning and the aspirational tease of consumerism and the need for acceptance in society captures them, as they head to the shops to brand themselves in coolness. They can’t afford the original, so they buy a-look-alike for a 10th of the price and walk on proudly. They do not know what they are supporting, that criminal networks lie behind the iniquitous counterfeiting world, and one cannot blame them. They are happy with the often, high quality counterfeit they buy, and who can really tell the difference?

The complex web of counterfeiting touches countless industries around the world – creating a growing crisis that demands urgent action.

How a counterfeit brand affects a brand’s reputation

What is most concerning is when the consumer’s well-being is compromised due to counterfeit products as well as how a brand’s reputation and market share might be affected. Furthermore, governments lose millions in tax revenue due to illicit trade. It is estimated that South Africa loses around R250 million a day due to illicit trade. Fortunately, the anti-counterfeiting industry is gaining momentum, driven by a powerful combination of authentication technologies, intellectual property enforcement, supply chain transparency, consumer education, customs and border control, and specialised investigative efforts. Together, these forces are working to protect brands, economies and consumers.

Counterfeiting for many leading brands is a crisis, or at the very least a potential crisis, especially given the growth of counterfeiting and the increasing porosity of borders, ports and supply chains. What too is a crisis, is deciding at what stage anti-counterfeiting solutions are required for a brand owner and how they are going to afford this type of solution.

How can a brand owner protect their brand against counterfeiting?

Many brand owners do not have a brand protection budget and any increase in cost to the product is prohibitory. A further crisis is the question of how a brand owner protects a brand without letting the consumer know that there is a counterfeiting concern.
Enter a marketing and a revenue generating opportunity.

Retail psychology tells us that picking up a product off a shelf can increase the chance of purchase by up to 200%. Smart phone technology is a powerful way of achieving this as the scan of a static QR code can turn the physical product into the digital world. Augmented reality is becoming a reality. Brands are now enticing consumers to scan their products by printing a “call to action” next to a QR code. “Scan to Win”, “Scan for More”, “Scan for instructions”, “Scan for Ingredients”, “Scan for Recipe”, etc.

How are QR Codes related to anti-counterfeiting?

QR code technology goes beyond a “static” code, when scanned it is limited to a website link. Unique QR codes and high security labels now offer unique secure identification opportunities for the brand owner, supply chain and consumer. Every individual item can carry its own unique QR code. Identical bottles of Whisky, for example can each have their own serialized QR code that can be linked to other codes on the bottle. By simply scanning the code with a mobile phone camera – no app required – the user instantly verifies the product’s authenticity and is seamlessly guided into the digital experience of the brand.

This process can be extremely beneficial to the brand. The consumer experiences a quick authentication and a great digital journey. The supply chain can actively monitor for counterfeits and detect instances of parallel trade between markets, while brand owners gain valuable insights from scan data (including geolocation) to identify counterfeiters and analyse consumer interaction patterns. The counterfeiter will also find the security label and associated technology impossible to mimic.

Is it therefore reasonable to say that using the counterfeit crisis to develop a digital marketing strategy within a marketing budget is the best way to fight the counterfeiter whilst increasing brand awareness and growing in revenue.

For more information, please contact Synchron Markings on cs@synchron.co.za.