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Never has brand protection been more important or more challenging than in today’s business environment. Counterfeiting is one of the biggest challenges brand owners and manufacturers face. The U.S. Federal Trade Commission (FTC) and Interpol’s World Customs Organization estimate the global counterfeiting problem to be upward of $600 billion per year. In addition to the billions of dollars in lost revenues, counterfeiting threatens brand and product integrity, corrupts supply chains, taints product pedigree, and increases the risk of liability for brand owners in case of consumer injury or death.
Given the growing landscape and increased sophistication of counterfeiters, the use of a single security solution to secure and validate is no longer enough. Brand owners and manufacturers that put all of their time and effort into deploying a single overt solution are likely to find that they are using an incomplete system. For example, packaging that can be reused or resealed needs more than a single layer of security. Rather than authenticating the product inside the container, companies that put their focus on a single area such as the outside label are merely authenticating a container that can later hold adulterated or fake materials.
If the ultimate goal is to deliver a legitimate product from the manufacturer to a consumer and to protect consumers from counterfeit goods, then brand protection requires more than a single layer of security imprinted on the outside of a box. It requires a multi-layered solution that features overt, covert, track and trace, and forensic elements to prevent counterfeit products mixing with legitimate items while assuring customers that the products they are buying are genuine.
Multiple layers of protection and the infrastructure to validate authenticity can not only provide comprehensive brand protection, but also deliver many cost-saving and marketing benefits. In fact, when used correctly, brand security can actually be a profit center. Integrating security with marketing and customer loyalty programs can move brand security into value-added payback, spurring additional customer interaction that can enhance customer loyalty and result in additional sales opportunities.
What Constitutes Multi-Layered Brand Protection?Multi-layered brand protection includes a combination of security elements such as industry and regulatory compliance, information technology systems to provide track and trace capability, and enforcement mechanisms that initiate internal and external response teams. It uses technology that incorporates overt, covert, track and trace, and forensic security (see Figure 1).
Overt technologies can be seen and include bar codes, specialty inks and labels, intaglio printing, holograms, watermarks, and tamper-evident film.
Track-and-trace systems are unique product identification solutions that can be applied covertly and overtly to individual products, cases, pallets, or shipping containers. The unique markers can be scanned at any point in the supply chain. Information is then uploaded to centrally located data management systems. Brand owners and enforcement teams can access these information systems at any time to track and authenticate their products at any point in the supply chain, from production to the retail shelf.
Covert technologies are solutions that are not visible to the human eye. These may include specialty inks, nanoencryption, and taggants that are integrated into the packaging or product, and can only be read with proprietary readers or detectors.
Forensic solutions are difficult to replicate. Forensic technologies can be tailored to meet the individual needs of customers and are exclusive to a product or brand.
Benefits of Multi-Layered Brand Protection ProgramsA multi-layered brand protection program not only combats fraud and provides the ability to validate product authenticity, but also adds the capability to integrate push-pull marketing efforts that enhance customer engagement and reduce costs associated with product recalls and fraud.
It is difficult to go a day without reading about a new product recall. In 2010, for example, the Consumer Product Safety Commission recalled 230 infant and child products (a 68% increase over 2009). Other industries, from pharmaceuticals to electronics and automobiles, have also faced significant recall challenges this past year.
Companies that incorporate layers of security and leverage new track-and-trace technology can actually limit the amount of product they have to recall. Batch or product serialization helps manufacturers authenticate their products throughout the supply chain. When integrated with a marketing component, the serialization component can identify who actually purchased the product and from where. With a back-end track-and-trace system in place to capture data along the supply chain, serialization can also prevent product diversion or errant distribution, as well as fraud.
Many product manufacturers do not have a direct connection to their consumers because products are distributed through a complex supply chain before they ultimately end up on retail shelves. Modern security solutions actually make it possible for brand owners to create a previously unattainable two-way exchange of communication.
For example, multi-layered integrated labels for wine and spirits provide state-of-the-art forensic protection, as well as a means for consumers to provide direct feedback to the brand owner. A unique forensic identifier provides the distributor and consumer product authentication that is impossible to replicate. A unique serial number on the label can also be cross-referenced via the Internet or a mobile device with an authentication database that can validate an individual bottle.
Once entered online or via smartphone, the winery can provide the customer with additional product information, as well as methods for interaction with the brand such as accessing recipes and wine/food recommendations. Leveraging these layers of security creates a proactive system that helps brand owners know who their customers are while providing validation technology that can help manufacturers identify problems with the supply chain down to a single bottle. If a unique ID is checked in California and then checked two hours later in France, the system has built-in alerts that are sent to the manufacturer to help them proactively enforce their brand protection in real time.
Layered security solutions also provide different levels of knowledge for the appropriate audience. A scan of a secure label can help brand owners know where a product is in the supply chain or provide a distributor with validation that a product is authentic.
In addition, entering a code into a smartphone can provide consumers access to additional product information and interaction opportunities with the brand. Consumers want to know they are getting what they pay for, and by incorporating brand protection with marketing initiatives, brand owners can include their customers in the validation process and engage them on an entirely new level.
A Solid ProgramIn the world of business today, it’s all about the brand. This includes brand protection, enhancement, profitability, strategy and sustainability. All of these can be significantly impacted by an effective brand security program that involves a thorough evaluation of a company’s security needs, followed by the design of customized, multi-layered security strategies that will protect products throughout their lifecycle, enhance the customer experience, and deliver multiple levels of knowledge and validation. A solid brand protection program does more than create confidence; it can help drive customer loyalty, providing additional opportunities for direct customer interaction and sales.
For more information, visit www.brandwatchtech.com.