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The Links Between Online Brand Protection and Physical Security Solutions

2016-08-02

This article appears in and is reproduced with the permission of the Arjo Solutions Blog .

Each year, the European Taxation and Custom Union publishes a report regarding the customs detentions of articles suspected of infringing intellectual property rights (ex: trademarks, copyrights, patents, etc.).

The last statistics published on 27 October 2015 (European Customs Report) show an increase in the number of shipments suspected of violating intellectual property rights. In 2014, 95,194 detention cases were registered by Customs, an increase of 10% compared to 2013.

By looking at the cases by means of transport, express and postal shipments represent an impressive 77% of the cases, most probably as a result of internet sales. Medicines, sunglasses, watches or toys are the main targeted products by counterfeiters, best seller products on most of the e-commerce platform.

Traditional Online Brand Protection offers miss the big picture: Focus on the product!

Monitoring product counterfeit offers on the internet is a relatively young discipline, compared to other intellectual property protection actions. It was only in the last decade that companies started to consider Online Brand Protection as a separate function within their structure and hired Online Brand Protection Managers with related teams.

While online monitoring is a new industry, it has not changed much since the first brand owners, typically from the apparel and luxury products industries, implemented their first online monitoring programs. Online product monitoring used to focus too much on the identification of counterfeit offers and the only goal was to send take-downs notice to e-commerce platforms. You had an online problem and you solved it online. This approach considers online monitoring as an isolated tool, without studying what are the links to the rest of the intellectual property protection disciplines, such as product protection, offline investigations or customs seizures.

Online Brand Protection is an essential pillar of your brand protection strategy

A holistic approach to online brand protection means that online monitoring provides inputs to other intellectual property protection disciplines.

When brand owners need to define a strategy about what brands, products and exactly which parts or components of their products need physical security features, Online Monitoring can provide valuable insights that help allocate a budget for physical security features, answering basic questions such as:

  • Which of my products are being affected by counterfeiting and need physical protection features?
  • Based on online monitoring statistics, what are the most frequent physical indicators* of counterfeit products and what is the breakdown** per brand?
  • What is the breakdown of physical indicators by country?

* Example: a perfume bottle of 55mL (does not exist for the brand)
** Breakdown means having statistics of what percentage of counterfeit online offers affects each brand from a given customer

Apart from using Online Brand Protection as a tool to identify needs for security features, online monitoring can be used to periodically assess the success of security features. Establishing a parallel with an ill person, if the patient is ill and took a medicine, Online Brand Protection is the thermometer that tells us whether the medicine (security features) are efficient. Online Brand Protection Reports should help to quantify the counterfeit situation before and after security features are implemented.

Online Brand Protection and Product Security: Arjo Solutions and ApiraSol GmbH partner to provide integrated approach to brand protection

Arjo Solutions, provider of solutions to physically protect brand products and ApiraSol GmbH, provider of advanced online monitoring solutions, partner to provide brand owners with an integrated approach to product protection, understanding both offline and online aspects of the fight against counterfeiting.

Our goal: to offer brand owners with a holistic and proactive strategy with the shortest reaction-time possible. Reaction time is the time a brand owner needs to adopt security features or online monitoring campaigns to protect a certain product category in a certain market. Ideally, these online and offline measures should be adopted before a new counterfeit version penetrates a market.

Traditional approaches reacted too late to new counterfeit versions. Brand owners discovered counterfeit versions in their strongest markets and then instructed their online monitoring provider to “clean” those platforms and eventually decided to adopt security features.

We believe that it is the responsibility of providers like ApiraSol and Arjo Solutions, to warn our clients about the existence of new counterfeit versions early enough and before they actually reach the most strategic markets.

In the same line, adopting a proactive approach to online monitoring and implementing security features in time, requires a new mindset to understand return on investment (ROI) in brand protection.

Measuring a Return on Investment (ROI) for Brand Protection program: a real challenge

Many brand owners and providers still measure Online Brand Protection success solely by valuating takedowns. Not only does this KPI rely on subjective data provided by the sellers themselves (as the stock claimed by online sellers, which is often inflated), but it is a metric that is not telling us whether we improved the exposure of genuine products in relation to counterfeit products.

Instead of (only) counting the amount of takedowns, we need to count the change in the amount of counterfeit offers available to consumers at a certain marketplace at two points in time – before and after online monitoring programs and security features were adopted. In other words, we want to know if brand protection is helping genuine products to get a bigger slice of the pie, be it online or offline.

To make this analysis even more “touchable”, measure both the amount of counterfeit and genuine products in a certain platform at two points in time and calculate the change in the % of genuine products available. This simple exercise reminds us why we do brand protection – not just to fight illicit trade, but to be able to sell more of our products.

Combining Online and Offline Intelligence for more efficiency: Cluster Analysis

As pointed above, traditional approaches to Online Monitoring focus solely on removing infringing offers. Every offer or domain is an individual lead.

We think this approach misses the big picture: looking at the relationships between online and offline intelligence and what are the implications for product security features and packaging design.

ApiraSol and Arjo Solutions developed Cluster Analysis tools. These are highly advanced collection and visualization interfaces that show how online leads are connected to offline intelligence.

In other words, who are the people and organizations, physical addresses, phone numbers connected to Online infringers. Visualizing such links also means that we can estimate the possible transport paths followed by the counterfeit goods, the “age” of a counterfeit network, the level of penetration in a market, etc.

By analyzing Cluster Graphs together with our clients, we are able to select the most appropriate authentication solutions that will not just aim to protect the market with most counterfeit cases, but will attack the counterfeit supply chain as a whole, understanding it as a network of multiple counterfeiters and countries that security solutions need to address.

ApiraSol and Arjo Solutions will help you assess your current situation in terms of product protection. We are glad to support brand owners with live demonstration of our tools and provide strategic advice on what Online Brand Protection and Security features will better solve your current challenges.