Stopping counterfeits online: How cosmetic brands can protect their products and reputation

Online marketplaces have revolutionised how consumers shop, offering businesses unprecedented access to consumers worldwide, including in the cosmetics sector.

But that accessibility comes at a price: counterfeiting. Counterfeiting involves deliberate and unauthorised imitation or reproduction of genuine cosmetic products. For industries like beauty, where trust in the quality and origin of a product is paramount, counterfeits can be very damaging to a business' brand.

A Which? research study evaluating counterfeiting in the cosmetic industry showed that 23 out of 34 (67%) of the branded items bought and tested were likely counterfeit. The study also highlighted the history with the quality of counterfeit products. Fake make-up, and other beauty products have been previously found to contain animal feaces and urine, as well as arsenic, lead and mercury.  

These fake products not only pose risks to consumer health but also, risk eroding consumer trust and brand reputation. For brands looking to protect themselves, we discuss some options available in this article.

Register your intellectual property rights

The first and most essential step in the prosecution of counterfeit products is the registration of a business' intellectual property rights. Registration will not only enable you to take legal action against infringement, but it can also deter third parties from infringing your rights.

A registration strategy should incorporate brand and packaging elements through trade mark and design protection. The formulas of products should also be protected.

Online monitoring

One of the most effective ways to combat online counterfeiting is by strengthening market monitoring technology. Businesses can leverage advanced technology that can scan major platforms to detect suspicious listings, unauthorised sellers and pricing anomalies. These technologies flag potential issues in real time, allowing brand teams to act quickly to take down requests.

Take down requests

Many online platforms have implemented measures which enable businesses to report any counterfeit products based on their registered intellectual property rights. For example, Amazon has introduced its registry programme, which businesses can use to actively monitor and take down infringing products.

Training

Educating staff and consumers can be a valuable investment in the fight against counterfeits. Businesses can invest in appropriate training, and publish clear guides highlighting issues caused by counterfeits, and how these can be escalated appropriately.

Training staff to recognise authentic products is also key. Staff must be able to assess the quality of products to establish whether they are counterfeit or not. Some methods employed by businesses include:

• Holograms incorporated into the product packaging.
• Unique, hard to reproduce materials embedded into the products or their packaging.
• Blockchain technology which enables businesses to track a products journey from manufacture to sale.

Supply chain monitoring

Beyond the digital realm, counterfeit prevention must begin at the source: within the supply chain. Businesses can work with customs to prevent counterfeit products entering the UK. How? As an intellectual property holder, businesses can make an  'Application for Action' (AFA) requesting the detention of goods suspected of infringing any intellectual property rights.

Border Force officials will then use this information to identify and seize potential counterfeit goods before contacting you to understand whether the goods are authentic.

Cease and desist letters

If the brand has already been infringed, a cease and desist letter can be sent to the infringer detailing the relevant intellectual property rights and the infringement, and setting out actions required of the counterfeiter.

Sometimes, a cease and desist letter sent by a law firm can be enough to stop an infringement. But it can also lead to further litigation.

Litigation

Sometimes, a business may need to consider litigation. As far as it is possible, litigation should be a last resort. However, if needed, a business can issue proceedings and ask the court to order:

• An injunction stopping the infringer's activities.
• Damages or an account of profits.
• Delivery up or destruction of the counterfeit goods to ensure these cannot enter the market again.

Key takeaways

Counterfeit products pose a threat to a brand's reputation and can severely impact customer trust in that brand. This can, in turn, negatively impact sales and the perceived value in legitimate products. It is therefore important that businesses take a pro-active approach to dealing with counterfeiting issues.

Trade mark registration is a crucial step in the journey to deal with counterfeiting. Without it, a business has more limited (and often costly) options to deal with infringement. Once there are registrations in place, however, doors open to deal with counterfeiting issues more effectively.

We can evaluate your portfolio and advise on the best form of protection, taking into your account the issues at hand, the commercial goals of your business and any budget constraints.

Please do get in touch if you need assistance.