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Generation Fake: Beauty and the Counterfeit Beast

The beauty industry is huge, we are undoubtedly a society who love to look after ourselves and our image. Add a global pandemic to the mix with no hairdressers, barbers or beauticians open and it’s not surprising that DIY beauty product sales have boomed in the last year. It’s been a difficult time for businesses; however, this hasn’t stopped fakes appearing in the industry and whether it’s hair straighteners and shavers or fake tan and lashes, it’s just a click away from being delivered to your door. But is it genuine? Fake beauty products have never been so sophisticated, and it has become even more difficult for the savviest shopper to spot a fake and for online marketplaces to monitor.

The ugly truth behind fake beauty products

Unscrupulous counterfeiters have used COVID-19 to cash in on the industry and sell illicit products, which brings huge safety concerns.  Statistics from the IP Crime and Enforcement Report state that 10,162 cosmetic products alone were seized by Border Force and Trading Standards in the UK in 2019, with perfume reaching a staggering 37,078. These are the products stopped, but what about the ones that may have slipped through?

Fakes bring huge risks not just for brand owners but also for customers. Counterfeit products have not been put through tough safety checks or testing or been manufactured in safe, monitored conditions. There are horror stories of victims who have their lips sealed together after using fake lipsticks and receiving burns and rashes to their skin due to dodgy products containing toxic chemicals. This can be damaging to a brands reputation and cause a loss in sales and customer confidence.

In the past it may have been easier to spot counterfeit items with obvious dodgy packaging, spelling errors and blurry images on product or website pages. However, counterfeiters adapt and have become highly sophisticated. With advances in technology, it’s easy to manufacture copycat packaging, combine this with copyright theft of a brand’s imagery, selling goods via social media, and creating fake websites and counterfeit beauty products can get through many channels into the hand of the most discerning customer.

Websites to watch

No selling platform is 100% safe from being infiltrated by counterfeit product. Many have set up programmes, such as Amazon’s Brand Registry and Project Zero, and will have reporting mechanisms to manage intellectual property infringement, however fakes can still rear their ugly head. It’s quite straightforward for someone to set themselves as a third-party seller (3P) or Marketplace seller on Amazon. Even for brands that are a first party seller (1P), Amazon being the legal holder and owner of the inventory, with so many brands being sold and tight delivery deadlines, monitoring genuine versus fakes is difficult. The process of piggybacking can also occur. This is where illegitimate sellers can use the same item number as a popular product to resell items or sell counterfeit ones. As a result, their listing can appear near a legitimate one and look genuine. If these sellers get caught and shut down, then another shop can easily pop up in the near future under another name.

Online selling platforms such as eBay, Alibaba, AliExpress, Wish and DH Gate are other sites that should be treated with caution. Like Amazon, not every brand can be monitored or even be known to the marketplace. There is also the issue of the Grey Market, where goods have not been authorised for re-sale by the brand and become available for sale using methods outside the brands usual distribution methods. These online platforms are a way to sell and quickly distribute popular beauty brands across the world sometimes with heavy discounts.

The grey market is problematic for the beauty industry as it impacts the integrity of their brand as well as pricing structure and profits. The ‘white market’ defines goods sold officially, however, the grey market, like counterfeits (black market) is difficult to monitor and enforce. It explains why cheaper priced ‘genuine’ beauty goods sometimes end up being sold in bulk on online marketplaces or in a local bargain store. For example, buying the premium shampoo your hairdresser recommends directly from the salon may be more expensive, however you know you are buying a genuine item that has been sold via correct channels. If you purchase the same item via an online marketplace at a reduced price, even if it was originally bought by a legitimate distributor, it may not be the same quality. It may also have been in a warehouse for months or years and passed its shelf life. Worse case, it could even be a counterfeit, watered down with a different smell and consistency and bring possible health risks.

Fake products on social media

Whilst social media can benefit brands, with their influencers and fans helping to build hype and a cult following, the likes of Facebook, YouTube and Instagram can be an issue as they are another channel for counterfeiters to access. On Facebook Marketplace a ‘replica’ luxury brand item being sold may be easy to spot, on Instagram Stories and Facebook Live scammers can quickly post video clips to advertise fakes and send viewers links to purchase. In many cases, they won’t show the packaging, and to the untrained eye, the unboxed product can look real. They may also use copyrighted images or videos on their pages which convinces the buyer it’s legitimate. There are also dedicated groups on social media set up to knowingly encourage buying fakes and targeting specific demographics.

Social media is a big growth area to watch out for, particularly with the likes of TikTok which has taken off during the pandemic. Sadly, it’s not all videos of cute animals and fun dance routines, TikTok is another way for opportunists to promote counterfeits. There have been reports of videos and virtual tours of factories selling their counterfeit wares in China being used to attract new distributors, as they are online for such a limited time it makes them almost untouchable. Another trend is the use of sponsored ads selling fake goods, often leading the buyer to a copycat website or a random website which may appear online for a short time.

The new social media warrior

Whilst social media is being used in abundance to flog fake wares it’s not all bad news and social media is being used by many for good. There are many loyal brand followers who have taken to social media platforms to warn others about fake goods and what to look out for. YouTube has an abundance of helpful videos and tutorials of cult products from brands being analysed under a fine-tooth comb by social media vloggers who want to help spread the message about fakes. Similar videos can be found by vloggers on TikTok, Instagram and Facebook which is undoubtedly helpful to brand owners and consumers.

Protect your beauty brand from counterfeits online

How to help your brand fight fakes in the industry:

  • If you haven’t already, ensure your Register your Intellectual Property. This can cost as little as £200 on the IPO but could save you thousands long term. Check out our blog on Brand Protection Essentials for more.
  • Enforce copyright. Copyright is the one intellectual property that doesn’t have to be registered, in 167 countries copyright is granted automatically on creation of the work.
  • Report the infringing products on the appropriate channel. All major platforms have reporting mechanisms to enforce Intellectual Property.
  • Advertise your white-list sellers on your website. Ensure your customers know where they can buy your product using the correct channels.
  • Monitor online marketplaces and social media and watch out for any new platforms. Do a google reverse image search to see if your branding, images or videos are being use. Search for your product in different languages.
  • If you see a suspicious product buy it. If you have never had a problem with counterfeiters, it is usually a case of not ‘if’ but ‘when’. Buying the product can help as evidence and to investigate any supply chains.
  • HMRC and Border Force work to stop counterfeits entering or leaving the country. By applying for a Rights Application for Action (AFA) this will alert customs and help stop counterfeits entering the country. More information is available here

Well-known global brands will have dedicated legal teams to help them keep fake goods from sale, for other brands it can feel like a losing battle. At SnapDragon we are fierce online, friendly offline and can offer brand protection to cater for all needs. Get in touch for a no-obligation chat about your online brand protection options, we’d love to hear from you.

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Kellie has a background in consumer protection working in Australia in marketing, PR and as a copywriter. She joined SnapDragon career as a brand analyst, and is using her passion to fight fakes to help raise awareness of the importance of online brand protection.