Author: authentix

Social Selling Has Empowered Counterfeiters: How Can You Fight Back & Protect Your Brand?

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Author: authentix

By Bharat Kapoor, Vice President of Online Brand Protection, Authentix

With online sales continuing to surge, companies are focusing on digital marketing and advertising products through various social media channels.

Not only has there been a rapid shift towards sales through online channels as a result of Covid-19, with corporations such as L’Oréal for example reporting a 62% increase in online sales across divisions and regions, the marketing of products through influencers has also experienced a dramatic uptick with the influencer marketing industry estimated to be worth US$9.7bn in 2020.

However, according to a report published by Instagram, 20% of the posts associated with top brands on social media featured counterfeit or illicit content.

The way customers interact with brands has been changing over time with two factors driving that change. One is technology where you have omnichannel sales and you’re getting messaging from social media feeds, e-commerce, marketplaces, influencers and so on. Customers buying products online also have access to delivery infrastructures that haven’t before existed in the way they do today. For example, if you buy something on Amazon in Southeast Asia, Asia or the US, it can come to you within hours. And what counterfeiters really take advantage of is exactly that: they find places where it’s easy for them to promote and sell anonymously and use this delivery infrastructure that’s been created by other legitimate businesses who have invested billions and billions of dollars in e-commerce.

The second thing that is helping smooth the path for piracy are payment systems that make it possible to move funds cross-border seamlessly, which are often associated with e-commerce and the rise of China’s cross-border ‘daigou’ trade. Via this method, counterfeiters will attempt to use the pricing gap between retail prices and grey market products to sell counterfeits.

Today, with the various means of transacting, getting money from someplace in Europe into China is also instant. This type of financial structure unfortunately is geared up to benefit fraudsters.

What we’ve seen is cross-border e-commerce channels becoming extremely popular because they offer crazy discounts. These deals are backed by sellers in a foreign country that will be responsible for delivering the product once a transaction is completed. For example, we found and investigated sellers in Singapore that have no inventory and they simply place a back-to-back order when they receive an order. This makes it more complicated for the police to take criminal actions against such sellers.

For the cosmetics industry for example from a brand perspective, it’s not only about counterfeiting, which may be 30-40% of the issue. But you will also find infringers using other brand assets – films, photos, design patents, a wide spectrum of IP – to sell a particular product that could be a counterfeit, or even a lookalike product.”

Finding Out Who’s Selling Fakes

SIPI has a unique strategy for discovering the online vendors who are responsible for dealing in counterfeit products and those dealing in legitimate goods via its proprietary online monitoring and enforcement solutions. The aim is not only to protect clients’ brand image and copyright, but also their customers and reputation.

SIPI uses machine learning-based algorithms to scale up analysis and identify hidden trends in data gathered both online and offline to identify high-value targets.

The process begins with data gathering, in which SIPI scrapes data for clients’ brands from around 500 different e-commerce marketplaces and social media platforms. This data is fed into its online platform for risk screening and risk-scored by SIPI’s proprietary algorithms, under which over 30 parameters (including price, images, keywords, customer reviews and seller activity) are taken into account.

In terms of the algorithms, you must approach your research and your study of a potential infringinglisting by looking at the listing in the wider context. It is sometimes quite difficult to identify a counterfeit product just by looking at the listing, because legitimate brand owners may also sell their products at discounted prices. They have other channels and many other ways of selling. So, you can’t just say that the price of a product being 30% or 40% below average is, alone, an indication of it being counterfeit.

You must be more diligent in terms of your assessment of a seller. And that’s what SIPI has trained our algorithms to do – to know what else to look at online. For example, you can look at customer comments, store rating, how old the stores are and the types of products that you see the store selling, such as luxury goods alongside very generic products, which may be viewed as being suspicious.

To identify offline targets, high-risk sellers are further investigated to create seller and product clusters, the name for groups of sellers concentrated in a region or dealing in a single product. A complete digital profile is created for high-value targets after which these leads are shared with an offline investigator for further investigation and action. The remaining infringing listings are reported to the respective marketplaces and social media platforms for takedowns.

SIPI currently protects over 200 brands and maintains a 94% success rate across platforms. While it strives to have a 100% success rate, certain major marketplaces in China and Asia make it extremely difficult to file complaints against each and every counterfeit instance.

And it is not simply a case of either how sophisticated or poorly-made the fake products are as to whether these are blatantly obvious versions. There are multiple avenues for illicit commercial activity.

SIPI has noticed a sharp increase in the number of sellers claiming to manufacture products and supply packaging materials that support the counterfeiting trade. There are also cases of verifiable and legitimate products being sold illegally.

Looking Forward

Given the wider e-commerce environment playing so well into counterfeit sellers’ hands, we believe the combination of Authentix and SIPI’s expertise comes at a beneficial time for brand clients. The acquisition of SIPI by Authentix increases the scope of its offerings to brand protection clients by integrating digital security technologies and online anticounterfeiting and content rights services for an end-to-end, comprehensive brand protection solution.

SIPI provides clients with solutions to digitize their supply chains and uses investigation techniques to determine instances of counterfeiting and diversion while attempting to keep the internet free of fakes by building effective online enforcement programs.

For a limited time, SIPI is offering a free online brand risk analysis to qualified brands. More information can be found here.

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The Sum of Its Parts: Well-Curated Authentication Technologies in the Fight against Illicit Trade

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Author: authentix

By Jessica Wirka, Brand Protection Director, Authentix

Whether you’re a brand owner protecting a commercial product or a government authority issuing critical, high-security documents, you’re continually faced with the ongoing challenges of combating illicit trade and counterfeiters.

To counter these constant attacks on legitimate industry players, high security authentication solutions are needed to safeguard the integrity of global commerce and can include both physical and digital security solutions. Security can be added to documents, products, and product packaging or labels. In addition to adding these security features, the more advanced and effective authentication programs should also include track and trace capabilities that allow the tracking of protected products throughout the supply chain.

With a comprehensive and well-curated authentication program, brand owners and governments can take a more proactive approach to protecting consumers from potential health and safety issues and themselves from the financial impacts of counterfeiting and diversion.

Product Marking: The Foundation

Physical marking solutions can range from simple yet effective to highly sophisticated and extremely secure. A typical marking ‘toolkit’ consists of four basic elements, each of which performs a different function, ranging from detection, prevention, deterrence and engagement.

  • Tamper Evident – cannot be opened and reapplied without visible damage, therefore deterring and preventing nefarious actors from interfering with the product
  • Overt – visible to the eye and hard to copy, which deters from and ultimately prevents attempts to mimic the feature due to the high barrier to entry both from a cost and from a technical point of view
  • Semi-overt – visible to the eye upon performing a simple action, which means the brand owner can choose when to change a feature from covert to overt by timing the invitation to the public to engage in the authentication of the product
  • Covert/forensic – invisible to the eye, detectable using a hand-held device (covert) or laboratory equipment (forensic); being invisible, covert and forensic features do not prevent counterfeiting, but they facilitate unequivocal and quick in-field verification of authenticity and detection of counterfeits.

A combination of these features presents the most water-tight strategy against a number of illicit trade activities including counterfeiting, diversion, and infringement. To ensure successful implementation with minimal impact to current processes already in place, the most effective approach is to integrate the application of security features into existing processes within your manufacturing and vendor base, whether it is printing, labels, tamper evident seals or specialized overt and covert inks, using existing materials and packaging designs.

Going Digital: Connecting your Asset to the Cloud

Product marking is the foundation that supports digital security technologies, given that the physical form of digital identifiers can be validated when combined with robust printed security features.

Products become digital touchpoints by adding unique, item-level digital identifiers to the product or its packaging. Unique identifiers can be delivered in various formats such as overt or covert Datamatrix codes, QR codes, human readable alphanumeric codes, or embedded NFC chips, added to any part of the product or packaging or other carrier vehicle. These digital identifiers can also be embedded into an existing code format or added as a covert ‘twin’ of a visible code in cases where codes are at risk of being removed in an unauthorized attempt to destroy the traceability of the product.

In general, there are three main users of this technology:

  • Supply Chain Participants – manufactures, distributors, 3rd party logistics
  • Inspectors – a brand’s internal team, local law offices, law enforcement and customs agents
  • Consumers/e\End-Users – for authentication verification and engagement

What’s Next: Using your Connected Asset to your Advantage

Connected products are typically used in three different ways and for different objectives. These include journey tracking, authentication and consumer engagement as shown in this graphic.

 

Driven by a rules engine that is calibrated by the brand owner or government, each of these paths direct critical data back to them in the form of actionable insights and analytics that are leveraged for strategic decisions across multiple agency focus areas or corporate functions, such as legal, operations, supply chain, marketing and others.

Examples of data that can be gleaned include locations of suspicious activity, excessive scan volume, geo- fence violations, multiple scans/single ID alerts, top scanned codes, and more.

The Role of Data: Collect, Analyze, Act, Share

There are many areas in which data can prove exceptionally meaningful. These include:

  • Secure mark: validates if the product is genuine or fake
  • Distribution: routes, port of entry, freight forwarders, dates, etc.
  • Illicit activity: captures and ear-marks products/codes that are suspected as counterfeit or diverted
  • Source: increasingly important raw materials and components
  • Product: records product make or model, part number, batch and quality control data
  • Production: captures manufacturer, date and time of production
  • Location: identifies where was the product made, shipped, sold, or scanned
  • Consumer: opt-in driven consumer intelligence, contact data, location of scan, device, engagement

This data can easily be shared across internal teams, with law enforcement and customs, and used for benchmarking and best practices in discussion with other brands.

Examples of client dashboard in the Authentix DigiTrax™ platform

 

In summary, both physical and digital technologies play an important role in the fight against illicit trade. Creating digitally connected products turns them into valuable tools for inspection, reporting and communication. When leveraged to its full functionality, the combination of physical and digital technology is a game-changer for our industry.

To learn more about Authentix brand protection solutions, visit authentix.com.

Inspector-Led Authentication – Whitepaper Download

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Author: authentix

Protecting your brand from counterfeiters should be easy, right? One would think but the Brand Protection conversation can be a challenging one within a product organization. You need an effective anti-counterfeit solution that incorporates both emerging technology and data analytics to start the conversation.

In this whitepaper you will learn what is needed to develop an anti-counterfeit plan:

      • Evolving role of the consumer in authentication
      • Internet of things, data aggregation and actionable insights
      • Improvements in inspector-led tools
      • Return-on-investment paradox








Authentix, Inc. and FAS Authentication Ltd. Win Fuel Marking Contract for Securing Transnet Fuel Pipelines

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Author: authentix

13 April 2022 – Authentix and FAS Authentication have been awarded a contract to pilot marking and securing fuel being delivered through Transnet Pipelines (TPL), the largest multi-product operator in Southern Africa. The technology will allow TPL to mark and trace petroleum products in their custody and support authorities in taking enforcement action if product is stolen or diverted. The scope of the program includes supplying proprietary covert chemical markers to differentiate fuel streams under TPL’s custody from the intake to delivery point. Transnet will test the performance of the tracing technology during this contract period and decide if further expansion of the program is warranted.

Transnet Pipelines transports approximately 17 billion litres of hydrocarbons and methane-rich gas through a network of over 3,000 km of petroleum and gas pipeline infrastructure. Naturally, challenges exist in protecting the integrity of these fuels during transit. TPL has witnessed an alarming increase in the frequency of product theft. These illegal activities cost the government and major fuel companies millions of Rand – as well as threaten the environment, health, and safety of South Africans.

As part of this pilot contract, the Authentix/FAS consortium will manage all in-country logistics for the program including security, warehousing, personnel, and infrastructure as well as the application of the core technology, enabling hardware, and custom analyzers. The solution will include the Authentix Information System (AXIS®), a cloud-based data information platform, to enable tracking, compliance, and enforcement when illicit or stolen fuel products are found in the supply chain. This fuel integrity system will provide fuel product authentication via inert and environmentally friendly technologies.

Authentix’s fuel integrity programs have helped dozens of national governments and international corporations to recover billions of dollars in lost revenue due to illicit trading and theft.

Authentix® UK Ranks #6 on York’s Top 100 Business List

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Author: authentix

ADDISON, Texas, 8 April 2022 — Authentix, the authority in authentication and information services, has been ranked sixth in York’s Top 100 Businesses in an annual report published by The Press in conjunction with its partners, York St John University and City of York Council.

Moving up in three years from 50th to now 6th in York’s Top 100 Business List, the York-based Authentix team is proud to be a part of this list of significant businesses that have remained committed to investing in the local York economy. According to York St John Business School, a custom algorithm takes into account performance indicators such as turnover, profit, size and growth to determine the businesses that are key contributors to York’s professional landscape.

“We are honored to be a thriving part of the York business community. Being recognized in the York Top 100 Business List is a testament to our continued rapid growth and moreover to the Authentix team and all of our employees worldwide who are focused on our clients and helping to create a world of confident commerce,” said Kent Mansfield, Chief Sales and Marketing Officer. “Being named in the top 10 of these 100 excellent companies for two consecutive years, is an honor and our team is motivated to continue our company’s strategic focus to expand our reach as a global organization while still being grounded to the local communities we serve.”

The top 100 businesses were featured in a special supplement publication that was distributed along with the April 5th issue of The Press. The top businesses who were honored gathered at the university to launch the issue, network, and toast to the diverse range of businesses in York.

About Authentix:

As the authority in authentication solutions, Authentix thrives in supply chain complexity. Authentix provides advanced authentication solutions for governments, central banks, and commercial brand owners, ensuring local economies grow, banknote security remains intact, and branded products have robust market opportunities. The Authentix partnership approach and proven sector expertise inspires proactive innovation, helping customers mitigate risks, promote revenue growth, and gain competitive advantage.

Headquartered in Addison, Texas USA, Authentix, Inc. has offices in the North America, Europe, Middle East, Asia, and Africa serving clients worldwide. For more information, visit https://www.authentix.com. Authentix® is a registered trademark of Authentix, Inc.

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Strengthening Our Systems to Better Protect Yours

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Author: authentix

Thank you to SAP and Seidor for featuring Authentix in a recent success story detailing our journey to harness the power of SAP Business ByDesign for real-time insights, accurate reporting and consistent data across our rapidly growing organization.

 

Authentix, Inc. Signs Five-Year Contract with the Republic of Congo for a Marketplace Governance Program for Digital Tax Stamp and Fuel Integrity

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Author: authentix

MARCH 2022 – Authentix announces today that it has signed major contracts with the Republic of Congo Ministry of International Cooperation and Promotion of Public Private Partnership for the implementation and operation of two National Marketplace Governance Programs to prevent illicit trading of goods in both packaged consumer products and retail fuels. Preventing this illicit trading in both markets will make sure citizens are receiving genuine products and also boost excise tax revenue by enforcing compliance with taxes that are levied on these goods.   The contracts cover a five (5) year term.

A new Digital Tax Stamp Track & Trace system will be implemented using the Authentix’ TransAct™ information system for affixing secure, digital tax stamps to beverages and tobacco and also provide field inspection kits to provide traceability and visibility into the supply chain and deter fraudulent activities – ensuring a level playing field for all legitimate industry stakeholders. The Fuel Integrity Program includes the supply of proprietary fuel marking and fuel quality testing, portable analyzers, and field test kits. Also included in the fuel program is access to Authentix Information System (AXIS®), a cloud-based information system, to enable tracking, compliance and enforcement of fuel marketing companies and retailers when illicit fuel products are found entering the supply chain. Both programs encompass implementation, training and support, technical support, device maintenance, and a country-based program management team.

Collaborating with governments around the globe, Authentix marketplace governance programs have helped to ensure the authentication and traceability of products in the supply chain while recovering billions of dollars in lost tax revenue.

The Republic of Congo’s Le Journal de d’Afrique has reported the signing of this major agreement in a recent news segment. See the video clip here.

Authentix, Inc. and Consortium Partner SACOM, SA Awarded Major Marketplace Governance Contract for Fuel Marking Services by Ministry of Mineral Resources and Energy of Mozambique

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Author: authentix

Authentix announced today that its business consortium with Autenticação de Combustíveis de Moçambique, SA (SACOM) has signed a major contract with the Ministry of Mineral Resources and Energy of Mozambique to implement and operate a National Marketplace Governance program to combat the illicit trade of fuels.  The contract covers a three (3) year term and implementation of the program is now underway.

The scope of this program includes supplying proprietary covert fuel markers along with logistics and management services to chemically mark the country’s fuel supply, monitor compliance, and provide detection capability to the government for the discovery and elimination of illicit and substandard fuels.  SACOM will handle in-country logistics for the program including security, warehousing, personnel, and infrastructure and Authentix will supply the core technology, enabling hardware, and a cloud-based data platform.  The solution will include the Authentix Information System (AXIS®), a cloud-based data information system, to enable tracking, compliance, and enforcement of fuel marketing companies and retailers when illicit fuel products are found entering the supply chain.   This fuel governance system will provide product movement control and fuel product authentication via secure and environmentally friendly technologies introduced at fuel terminals and loading sites and tracked to consumer retail stations.  At anticipated volumes, the contract will cover approximately 2 billion litres of fuel marked and monitored per annum.

Authentix’s Marketplace Governance programs have helped dozens of national governments recover billions of dollars in lost tax revenue due to illicit trading while also improving the environment by substantially reducing the amount of pollution due to low-quality fuels and waste oil products illegally entering the nation’s fuel supply.

Connected Products for Brand Protection

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Author: authentix

Control diversion, reduce counterfeiting and engage consumers.

By Jessica Wirka, Brand Protection Director, Authentix

Preventing unauthorized products from entering the marketplace has long been a major concern and challenge for brand owners. Products determined to be at risk should be protected to prevent adverse financial impacts as well as the health and safety of the loyal consumer.  In today’s more complex supply chains, deceptive practices such as counterfeiting, diversion and product tampering continue to be an unfortunate reality requiring more brand owners to take a proactive approach and implement protective measures to insure both the value of their brand investment and the safety of their customers.

Traditionally most brand owners have turned to a combination of security features including covert taggants and inks, overt specialty inks, and tamper evident closures as the most widely utilized security features to protect the higher value and most targeted products. However, other emerging technologies are enabling more choices by taking advantage of the near ubiquitous base of smartphones now estimated at over 3 billion active users worldwide.  New technology is becoming available which takes advantage of recent improvements in optical imaging and digital graphics to create digitally ‘connected’ products that can be added to the security feature portfolio for even greater brand protection while providing a connection and interaction with the consumer.

A connected product enables the sharing of information in real time about the product’s journey through the supply chain, its probable location of sale, volume-based unit sales trends, and if desired, an interactive connection to the customer whether prior to or after a purchase.

How are connected products created?

Products become digital touchpoints by adding unique, item level digital identifiers to the product or its packaging. This could include applications of a digital identifier to primary or secondary packaging; the capability to attribute or optically fingerprint an existing digital code or added as a covert digital identifier or “twin” to an existing printed code that prevents removal or copying of the code. These encrypted or covert digital identifiers can be added directly to the product carton, an adhesive multi-featured label, or a specialized tamper seal or other bottle or carton closure.

Unique identifiers can be delivered in multiple formats allowing for less complicated implementation, lower incremental costs, and increased levels of security. These may include overt or covert data matrix and QR codes, human readable alphanumeric codes, or embedded NFC chips, all of which can extend the visibility of the product’s journey from the manufacturer all the way to the retail consumer utilizing native smartphone capabilities.

Who can interact with connected products and how does it happen?

Multiple personnel can engage with a product and generate a recorded event or transaction as it moves through the supply chain to the final point of sale.  These transactions, evidencing a product’s journey, may occur in different ways and for different purposes. If we split these users into three groups, these could be classified as:

  • Group 1: Brand owners, vendors, employees, agents, or 3PL providers
    • This group tends to use industrial scanners to engage with or interact with the codes for inbound and outbound shipments through standard supply channels
  • Group 2: Contracted or agent inspector teams, law offices, law enforcement, or customs agents
    • These users can validate the authenticity of a product via a smartphone, with or without an app. The addition of an app allows inspectors to impart more detailed information, such as product pedigree and interactive incident reporting and management back to the brand owner
  • Group 3: End Users / Consumers
    • Consumers are growing more averse to downloading proprietary mobile apps to engage with a brand and have shown a preference for QR codes and NFC tags, both functions enabled natively in most smartphones today. Therefore, the ability to simply scan the secure and proprietary code to obtain more information about the product or its authenticity is essential for a greater level of consumer participation in this process. A digital track and trace solution such as Authentix’s DigiTrax™ also supports a unique ability to tailor the consumer web experiences to company brands by enabling interactive engagement post product scan. Integrated with a single scan event, the consumer can, for instance, receive brand storytelling, digital promotions, manage loyalty programs and connect to social media channels.

Using the DigiTrax solution as an example, the digital authentication process occurs as follows:

  • The user scans or taps a code on a product using a smartphone.
  • The data is submitted to a secure platform which determines the authenticity of that product and the result (yes/no) is sent back to the user in real time.
  • If the code is marked in the system as invalid, the user is notified, and an incident is recorded in DigiTrax.
  • The user is exposed to the delivery of branded content after authentication.
  • The brand owner accesses real-time scan data on a dashboard, which provides strategic insights and analytics that are helpful to multiple functional areas within the company.
How are connected products used?

Connected products are extremely powerful when used for the following objectives:

  • Journey Tracking for supply chain security and operations management. This is generally used for diversion management so that supply chain personnel can see how product flows through the supply chain and if the product is in the right place at the right time. If the product is in the wrong channel or market it can then be traced back through the supply chain to determine where the diversion occurred.
  • Authentication for brand protection and consumer assurance. Consumers and other users scan the product with their smart phone camera and learn whether the product is genuine or suspect. Counterfeits are revealed, and brand owners are alerted in real time with purchase locations and other critical details.
  • Consumer Engagement for storytelling, branding and consumer nurturing. After authentication, consumers are invited to engage with the brand for marketing purposes. This could include receiving brand storytelling, digital promotions, loyalty and reward information, and links to social media and other brand channels.

The key to a successful brand protection program is the recognition that ROI can be achieved across multiple functions in the company and leveraging the data gleaned during the process for actionable insights and business analytics.  Functions that benefit from scan data include legal, brand protection, supply chain, operations, channel management, marketing and digital engagement.

What types of data can be delivered to the brand?

An enormous amount of meaningful data can be delivered to brand owners in digital brand protection programs including information about a product’s provenance, its journey through the supply chain, the location/date/time of associated transactions including consumer scan events, validation of authentication or suspected illicit activity, and direct consumer marketing and engagement.

In summary, digital authentication and connected products are a critical component in rapid detection of product compromise and can be harnessed to deliver much more, too. Connected products are powerful inspection, reporting and communication tools that continue to deliver data to the brand and information to the consumer long after their point of sale.

To learn more about Authentix digital brand protection solutions, schedule a meeting with our experts by emailing info@authentix.com.

Criminal. Click. Catch.

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Author: authentix

How criminal websites are getting rich with conventional online advertising.

Digital advertising on the internet has far surpassed traditional media platforms when it comes to global advertising spending and it continues to climb in importance. Many of the advertisements that appear on websites are displayed as a result of programmatic advertising, a complex set of technical operations undertaken by software and without direct human intervention. This type of advertisement is a major source of revenue for operators of copyright-infringing, criminal websites and it can be a nightmare for legitimate brands to find their ads lending an air of legitimacy to such platforms and confusing consumers.

The business of advertising on illegal websites, or “badvertising” has now grown into a major global threat with the top piracy sites earning as much as US $1.34 billion. Bharat Kapoor, Vice President, Online Brand Protection further explains how this system is organized in an interview with journalist, Sabina Wolf of the German TV station, ARD, as she reports in the Hauptstadt Brief how criminal websites get rich with conventional online advertising. SIPI’s online brand safety service, Veri-Site can be used effectively to block advertisements to a range of high-risk sites across categories ranging from fake e-commerce, misleading news, extremist content, and piracy.

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