Vertical Markets

Fake products online concern

by Mark Rowe

New reports stress the dangers of buying fake products online during Covid-19, says a trade body. The International Hologram Manufacturers Association (IHMA) is raising concerns about e-commerce-based businesses being targets for exploitation during the pandemic by counterfeiters looking to cash in on the trade in illicit goods.

Haircare brands, cosmetics and skincare tools among other consumer goods have been hit, with one brand protection agency reporting an increase in counterfeit products sold online across 700 brand clients in the first six months of 2020. Skincare device company Foreo and haircare brand Tyme, have seen counterfeit sales increase.

Counterfeit products continue to flood the market, the IHMA says, an issue that has been exacerbated by the growth of e-commerce channels. The counterfeit market currently forms nearly five to seven per cent of global trade and, despite efforts from businesses, continues to seriously harm brands while customers are duped in the process. The World Health Organisation (WHO) has said that a growing volume of fake medicines are on sale in developing countries, while Interpol has seen an increase in fake medical products. Seizures of fake Covid-19 tests and personal protective equipment (PPE) have been reported by both the US CBP and the World Customs Organisation.

Counterfeiting is a multibillion-dollar global problem says the IHMA, but the crisis has added to the situation. Specifically, counterfeiters are taking advantage of the pandemic to market and distribute fake essentials – spurred on by increased demand and a perceived shortage of basic goods. Fake goods which are sold online or have a vague provenance can threaten people’s lives as well as damage corporate reputations and investment in companies and their products, research indicates.

The IHMA is urging brand owners and product manufacturers to be vigilant and review how they tackle the threats, even bringing forward plans for investment in authentication and verification technologies to protect brands, profits and reputation. A recent IHMA poll suggested that that almost half of manufacturers and suppliers of holograms had seen an increase in demand from customers, specifiers and end-users for devices and technologies during the height of the pandemic.

Dr Paul Dunn, chair of the IHMA, pictured, said: “Covid has opened the door wide for crafty criminals, who are infiltrating global supply channels, deploying scams and counterfeiting measures to trick consumers and damage manufacturers. Furthermore, items such as falsified medicines and drugs bought online pose a terrible threat and can endanger lives.

“Holograms can to be effective in the frontline fight against counterfeiters and fraudsters, protecting brands and profits. Those involved in the supply chain are reassured by their presence on products, recognising the security and financial benefits provided.”

The IHMA adds that use of well-designed and properly deployed authentication solutions, as advocated by the ISO12931 standard, enables examiners to verify the authenticity of a legitimate product, differentiating it from fake products coming from counterfeiting hot spots in Asia and eastern Europe. Even those that carry a ‘fake’ authentication feature can be distinguished from the genuine item if that item carries a carefully thought-out authentication, the association adds.

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