Packaging with strong anti-counterfeit protection can enhance product revenues by tens of percent. However, it is critical to define the right strategy, selection of elements and not underestimate supporting activities such as customer communication – write Optaglio´s Libor Šustr and Petr Hampl for Packaging Europe.
MarkMonitor research has recently shown that managers of more than 86% brands believe their business is significantly damaged by counterfeiting. Most of them say they lose between 10 – 50 % of revenues. In addition to revenue decreases, brands are impacted by low quality or even dangerous products circulating in the market.
It is a result of the huge growth of counterfeiting industry, which now is so strong that nobody knows how to cope with it. Historically, counterfeiting was primarily focused on money and documents. Products were imitated only rarely; most counterfeiters focused on antiquities.
Key features of today’s counterfeiting market
The enormous space for counterfeiting was opened firstly by mass production and then by changes in the second half of 20th century.
1) Most goods are produced in a different region than they are consumed. Up to the 1970s, most Italians drove Italian cars; Germans drove German cars, British drove British cars, etc. It was the case for most of the products. Local markets give only limited space for entering of counterfeiting goods into the distribution chains. Markets with some specialised items, such as exotic food, were truly global. However, it is tough to fake Vietnamese pepper, Havana cigars or a particular brand of Irish whiskey. More sophisticated clients understand the difference and not sophisticated clients don’t care. But lately, as one kind of handbag or brake pads is used worldwide, huge opportunities open up for counterfeiting.
2) Internet shopping. Most clients have never met a manufacturer representative. Many of them have never met even a salesperson. Often the product goes through several distributors. Almost nobody can follow the entire lifecycle of a product.