Anti Counterfeiting

Why are anti-counterfeiting measures not keeping culprits at bay?

Out of car trunks, basements, unregistered stores, flea markets, open markets, and sadly, in massive online marketplaces, you’d easily find people selling fake varieties of goods without a single care in the world – and hordes of people patronizing them.

A 2019 report by the World Customs Organization estimates the global value of the counterfeit goods market to exceed $600 million, more than 6% of all global trade revenue. Pirated products may be phony, but their impact on the world economy is too significant to be ignored.

antiCounterfeetingBg

Anti Counterfeiting

Why are anti-counterfeiting measures not keeping culprits at bay?

Out of car trunks, basements, unregistered stores, flea markets, open markets, and sadly, in massive online marketplaces, you’d easily find people selling fake varieties of goods without a single care in the world – and hordes of people patronizing them.

A 2019 report by the World Customs Organization estimates the global value of the counterfeit goods market to exceed $600 million, more than 6% of all global trade revenue. Pirated products may be phony, but their impact on the world economy is too significant to be ignored.

While many governments have policies in place to curb counterfeiting through established regulatory bodies, fake products continue to flood every industry and crash revenue charts. From footwear, clothing, and jewelry to electrical equipment, leather goods, and toys, pirated products are massively hurting national economies, destroying the reputation of genuine brands, causing companies to incur outrageous expenses in legal and preventive measures, and endangering people’s lives by exposure to substandard and potentially harmful materials.

This reality begs a new question – why are governments and individual brands spending tons of money on sensitization and awareness on intellectual property rights and brand reputation, and somehow, knock-offs are still able to sell at about 10 times the actual manufacture price? Despite coordinated efforts to crack down on these criminals, why have they continued to flourish?

The first obvious reason is cheaper prices.

Since they are always made of inferior and substandard quality, counterfeit products are supplied at cheaper prices than the original items, making them more attractive than genuine products. A customer-behavior survey reveals that 65% of customers are more likely to buy a fake product if it seems relatively well-made and is more affordable than the original.

Another reason is a lack of deterring legal consequences for identified culprits.

In many parts of the world, seemingly ‘strong’ laws and regulations are in place against the manufacture, distribution, and purchase of counterfeited goods. However, these laws are rarely enforced and piracy now enjoys the “normalized culture” cloak in several climes. Even when culprits are charged to court with solid evidence of their transgressions, the sentences are often too light to be taken seriously.

Culprits remain unfazed when served with legal notices and binding court injunctions. Aspiring counterfeiters are inspired by the lack of punishment to join the trend and destroy hard-built trust between authentic brands and customers. Major online marketplaces have lenient policies against counterfeiters and would usually just remove the listings and move on – the counterfeiters make up for a huge percentage of their business and commission revenue.

Furthermore, consistent demand creates a deep-rooted supply chain motivated by greed and encouragement from customers specifically seeking out cheaper knock-offs. While many brands take bold steps to seal off the supply channels, new avenues may pop up when demand refuses to relent.

The first step to coming to terms with the piracy problem is to maintain a well-protected foundation of registered rights – trademarks, designs, patents, logos, and all relevant certificates. While this umbrella of registrations does not deter the culprits from crashing your sales charts, brand protection strategies constitute the next series of steps.

Most business owners assume that “brand protection” simply involves owning the rights and sending out court injunctions whenever a counterfeiter is discovered. At AXENCIS, our interdisciplinary team of data analysts, computer scientists, and lawyers work in collaboration with our 24/7 marketplace monitoring technology to identify and verify infringements on intellectual property, remove these listings, pinpoint the actual culprits and their locations, gather evidence documentation, and shut down these illegal businesses for good – all at no cost to the client. Our lawyers work to secure compensations/payouts for our clients by facilitating the total seizure of the culprits’ assets. These seized assets also provide our operational costs and we require no reimbursement at any point or outcome of the total process.

While many governments have policies in place to curb counterfeiting through established regulatory bodies, fake products continue to flood every industry and crash revenue charts. From footwear, clothing, and jewelry to electrical equipment, leather goods, and toys, pirated products are massively hurting national economies, destroying the reputation of genuine brands, causing companies to incur outrageous expenses in legal and preventive measures, and endangering people’s lives by exposure to substandard and potentially harmful materials.This reality begs a new question – why are governments and individual brands spending tons of money on sensitization and awareness on intellectual property rights and brand reputation, and somehow, knock-offs are still able to sell at about 10 times the actual manufacture price? Despite coordinated efforts to crack down on these criminals, why have they continued to flourish?

The first obvious reason is cheaper prices.

Since they are always made of inferior and substandard quality, counterfeit products are supplied at cheaper prices than the original items, making them more attractive than genuine products. A customer-behavior survey reveals that 65% of customers are more likely to buy a fake product if it seems relatively well-made and is more affordable than the original.

Another reason is a lack of deterring legal consequences for identified culprits.

In many parts of the world, seemingly ‘strong’ laws and regulations are in place against the manufacture, distribution, and purchase of counterfeited goods. However, these laws are rarely enforced and piracy now enjoys the “normalized culture” cloak in several climes. Even when culprits are charged to court with solid evidence of their transgressions, the sentences are often too light to be taken seriously.

Culprits remain unfazed when served with legal notices and binding court injunctions. Aspiring counterfeiters are inspired by the lack of punishment to join the trend and destroy hard-built trust between authentic brands and customers. Major online marketplaces have lenient policies against counterfeiters and would usually just remove the listings and move on – the counterfeiters make up for a huge percentage of their business and commission revenue.

Furthermore, consistent demand creates a deep-rooted supply chain motivated by greed and encouragement from customers specifically seeking out cheaper knock-offs. While many brands take bold steps to seal off the supply channels, new avenues may pop up when demand refuses to relent.

The first step to coming to terms with the piracy problem is to maintain a well-protected foundation of registered rights – trademarks, designs, patents, logos, and all relevant certificates. While this umbrella of registrations does not deter the culprits from crashing your sales charts, brand protection strategies constitute the next series of steps.

Most business owners assume that “brand protection” simply involves owning the rights and sending out court injunctions whenever a counterfeiter is discovered. At AXENCIS, our interdisciplinary team of data analysts, computer scientists, and lawyers work in collaboration with our 24/7 marketplace monitoring technology to identify and verify infringements on intellectual property, remove these listings, pinpoint the actual culprits and their locations, gather evidence documentation, and shut down these illegal businesses for good – all at no cost to the client. Our lawyers work to secure compensations/payouts for our clients by facilitating the total seizure of the culprits’ assets. These seized assets also provide our operational costs and we require no reimbursement at any point or outcome of the total process.

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