Consumer goods are highly valued targets for counterfeiting and piracy on a global scale. Presently, 48 countries are listed on the US government’s watch lists for global intellectual property crime. Counterfeiting and piracy cost the U.S. economy approximately $250 billion annually, and Fortune 500 companies each spend an average of $2 to $4 million annually to combat the problem.
With extremely weak international regulation and enforcement of laws against intellectual property and product piracy, virtually every consumer goods category is at risk. Tracking of individual products and shipments through serial numbers, RFID, and various types of print packaging security can temporarily block some channels, but the huge demand for “knock-offs” and the multiplying distribution systems enabled by the web leave innumerable holes these efforts cannot plug.
Areas of Concern
High-End Consumer Goods
Consumer goods that are most vulnerable to counterfeiting and piracy often fall into two categories: digitally transferable intellectual property (software, movies, video games and music) and high-margin consumer goods (designer clothing, jewelry & watches and sporting & leisure goods). Globalization and the Internet have unlocked the doors for criminal behavior through the removal of the transactional touch point that often sets off a red flag. To combat the problem, companies have instituted large scale tracking technologies like RFID or serialization techniques that, in theory, enable the pinpointing of a specific product. However, these measures are often easily averted or copied by counterfeiters, leaving everyone – consumer, retailer, distributor and manufacturer – exposed.
R&D Documentation
In the consumer goods market, there are several factors that can dictate success: being first to market, being the best product, and ultimately, remaining the best product. It takes a good R&D department to accomplish these tasks, but it only takes one breach of corporate security to scuttle these efforts. Securing valuable trade secrets requires a solid electronic information security process, but when these documents enter the printed realm, they need to be copy-proof, or even encrypted to defend against prying eyes.
Outlook
The measures currently in place are not stemming the tide of piracy and counterfeiting that is engulfing the economies of the nations around the world. Christophe Zimmermann, Strategic Adviser at the World Customs Organization, stated that, "We are losing. We are losing on the luxury goods, we are losing on everything; criminals make more profit from 1 kilogram of pirated CDs than 1 kilogram of marijuana. In front of us we have organizations that are more clever than us and have more money than us."
It is imperative that another layer of security be applied throughout consumer goods and retail enterprises, from the tag and packaging of the product to the files in the R&D and manufacturing departments, in order to deter would-be criminals. Consumer education is needed, but it is not enough, and more measures need to be taken by the consumer goods and retail industry to literally empower the consumer to aid in the fight against piracy.
AuthentiGuard On-Demand Can Help
AuthentiGuard-On-Demand is a sophisticated print security technology that combines the benefits of copy and tamper protection with the ability to conceal sensitive data within printed documents. Utilizing standard desktop and commercial printers, the solution provides for the dynamic delivery of comprehensive protection that enables consumers to join the fight against fakes in the retail market.