Brand protection is discussed quite often on this blog. The issue is growing, and it is will likely continue to grow. The impact is more and more palpable, the defence is more and more difficult. The manufacturers try to move costs to other players, such as marketplace operators. Their requirements are often too high and lead to the markets destruction.
A few days ago media informed that watches produced by Swatch group (including Omega, Longines, and Calvin Klein) would not be available on Amazon. The internet giant fails to implements anti-counterfeit protection requirements. These requirements should ensure that each sold item is checked through contacting its manufacturer. Even if this check can be automated, it is so still too demanding. The producer lost the market with 300 million users, and Amazon lost very interesting products. Another internet sales giant, Alibaba, now faces very similar issues.
The central issue consists of selling products with insufficient anti-counterfeit protection or even zero protection and requiring third parties to do the job. Market operators and governments are expected to spend huge resources on the removal of fakes from the market.
The manufacturer can be compared to a person who doesn’t lock his/her house and later reports the robbery. Police would be sceptical, and insurance would refuse to pay anything. It is not a matter of regulations or customs. It is perfectly rational. If police protected all unlocked houses, they would need unlimited resources. The right solution is that everybody takes care of the safety of his/her apartments. Protection level corresponds to the asset value – from an ordinary cheap lock up to security door, bars and electronic alarms. Police can thus concentrate on a relatively small number of cases when criminals overcome all security measures.
It would be logical to apply the same principle to premier brand products. The more luxurious product, the more robust brand protection. Law enforcement actions would be concentrated on a small proportion of counterfeiters.
It is not just a utopia. Some alcohol producers have already taken over basic responsibility for the protection of their brands, and it works. But many companies still see brand protection just as a cost, so they try to transfer such cost to someone else. In the long-term perspective, it cannot work. The issue is not just budget; overall mindset needs to be changed. Companies need to move from anti-counterfeit protection as an additional cost to anti-counterfeit protection as a key design element and customer benefit. Marketing communication needs to be changed accordingly.
Money has passed a similar way. At their very beginning, king portrait hammered into coins was the only protection, and royal officers chased counterfeiters. A bit more sophisticated protection appeared later, making money production more costly. Now anti-counterfeit protection elements are central and most important elements of any banknote. Nobody knows, perhaps a big hologram will be a central design element of Omega Watch in future.
Although Optaglio is known mainly for its activities and products focused on document protection, it also offers a strong portfolio for brand protection. This portfolio includes, among others:
- Microholograms, tiny nickel particles of regular shape, letters or a picture engraved and holographic surface. Microholograms can be placed on a protected product, its label, or packaging. They can also be sealed into substrate (paper, plastic, etc.)
- Machines for the production of holographic substances (paper, plastic foil, etc.) with microholograms inside.
- Stickers and seals protecting against an unauthorized item.
- Printing holograms directly into the protection item.
Detailed information is available in BRAND PROTECTION section of Optaglio´s web site.