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Fashion industry facing a counterfeit crisis

July 27, 2022

The fashion market is under growing pressure from counterfeits and brand abuse. Industry expert Ryan Clott joins us, sharing his knowledge on the topic.

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In 2018 Global Fashion Agenda, Boston Consulting Group, and Sustainable Apparel reported that the global fashion industry was worth more than 1.8 trillion USD, with expectations that China would soon overtake the USA as the largest fashion market in the world. Growth in both the luxury and emerging markets throughout Asia is said to be the main driving force.

The fashion market has experienced astronomical changes over recent times as the digital transformation continues to revolutionize the ways in which brands advertise, sell and distribute their products. As a result, buyer behaviour has changed and shoppers are becoming smarter, with more information at their fingertips. Now consumers can compare items, access customer reviews, pay with the click of a button and receive and return items faster than ever before.  

Counterfeits and brand abuse

These digital changes and advancements in technology have also driven growth within the global fashion counterfeit market. The Organization for Economic Co-operation and Development (OECD) revealed that the counterfeit market is growing at a rate of 15 percent year on year and is projected to generate 1.82 trillion USD in 2020.

Platforms such as Instagram, where almost 20% of all fashion posts lead to counterfeit products, are enabling counterfeiters to increase visibility, sales and revenue on official platforms which are trusted by consumers. This also applies to marketplaces, in fact our very own Smart Brand Protection survey found that 41.62% of online sportswear shoppers believe that if a product is being sold through a legitimate marketplace (such as Amazon) then the product must be genuine, which is a huge concern for the industry.

Identifying legitimate products through innovation and technology

Technology and innovation are playing an important role in the fight against piracy and counterfeit goods. Recently we hosted a webinar with Ryan Clott, an expert in the fashion industry who has worked for some prestigious fashion brands. Ryan shared with us some exciting real-life examples of how companies are fighting piracy and counterfeits and how innovation is being used as a key weapon:

Ryan explained that Ugg is one of the most counterfeited products in the fashion market and as a result they’re developing their own initiatives to combat the issue. They’re approaching this in two ways:

  1. On their official website Ugg hosts a URL or website verifier. This tool allows consumers to enter details to confirm if the store is an official, certified reseller.

  1. The second useful feature Ugg offers on their website is an image database. These images show the official packaging, product stitching, the finer details and features against copies, fakes and counterfeits. This helps consumers to quickly verify if what they’re buying is the real deal.

This is extremely useful when we consider how many consumers buying fashion products online are unable to identify if the item that they’re viewing is an original or a counterfeit copy. Despite the size and growth of the counterfeit market, not all consumers who purchase counterfeit copies are purposefully doing so. The official brand or online store have a responsibility, not only to protect their own interests but also those of the consumers too. Failure to do so damages consumer confidence in the brand.

Other more complex methods have been developed which counterfeiters will struggle to replicate, let’s look at QR and RFID authentication.

Coca-Cola has worked alongside a start-up called Visualead to implement technology known as Visual QR Codes. They have placed a product image on the packaging with information for the QR code surrounding the image. This is good for two reasons:

  1. It’s an effective way for brands to advertise
  1. It allows customers to verify its authenticity by simply scanning the code

This technology is something which counterfeiters will struggle to replicate, and consumers will have more faith in the product if a company is showcasing the product in this manner then, it’s likely to be authentic.  

The RFID tag is another piece of technology being used to fight counterfeits and has been developed by Fijitsu. It’s sewn into a bag or a piece of clothing like any normal label. Consumers can use their phone to scan the tag for verification.  

These tags are washable, dry cleanable, and integrated directly into the product. Again, it’s a technology that counterfeiters are unlikely to be able to recreate and enables potential customers to verify whether something is real or not in seconds.  

Expert advice from Ryan Clott

As mentioned, we recently heard from fashion industry expert Ryan Clott in our live Smart Brand Protection Webinar. Ryan possesses a wealth of experience having worked as a fashion consultant for various brands including Fila, Banana Republic, Cole Hann, Steve Madden, Nat Nast and Polaroid. Ryan also co-founded several fashion companies including the first fashion tech accelerator in Spain. You could say that Ryan knows a thing or two about the fashion industry and has experienced the damage caused by counterfeits first-hand…

“Brands need to take a proactive approach, so if you are fighting against a counterfeit and trying to remove it from a website, you’re already too late. It’s very important that brands take a proactive approach to eliminate the possibility of that even existing, which is very difficult to do, but it is becoming increasingly easier thanks to lots of technologies, innovations and capabilities.”

“It’s incredibly important to stay ahead. This is probably one of the most important things that can be done, it’s much more costly to fight counterfeiting when it has already wreaked havoc on your brand.”

What we do at Smart Brand Protection

We protect brands online. Our technological platform trawls the internet detecting, analysing and removing brand infringements. Our aim is to uncover these infringements and eliminate them before the consumer discovers them. We achieve this using bots and algorithms which work by searching for brand names and key words associated to a specific brand.  

Alongside brands, we build lists which comprise of their official webpages, social media pages etc. to ensure that we do not remove any official content. In this way we can keep track of suspicious content, allowing brands to access our platform to validate or ignore these infractions in the click of a button. Our platform then delivers automated reports.  

Our partnership with Google as a member of their Trusted Copyright Removal Program (TCRP), allows us to delist websites in less than two hours, and our agreements with the main social networks mean we can delete content from Facebook, Instagram and Twitter in seconds. The protection we offer significantly reduces the damage that counterfeits and brand abuse can cause to revenue and brand reputation.  

Do you want to know if your brand is at risk online?
Talk to an expert

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