Copied: How Counterfeits are Harming Outdoor Brands

Jun 10, 2019 5:18:37 PM / by Ailidh Mather

 

Couple in the outdoors

 

The birth of an industry  

From the heady days of Outward Bound in the 1940s, to the hippy/rucksack culture of the 60s, right through to the 80s boom in keeping fit whenever and wherever you could find the right terrain, making the most of the world outside our window has been something we’ve all enjoyed since we were able to stand on two legs.  

Today, the Outdoor industry can thank many of these 60s freewheelin’ backpackers whose love of the great outdoors would spur them on to create some of the best known Outdoor brands we know and love - from Jansport to Hi-Tec to Lowe Alpine to The North Face - and then some. 

The Outdoor industry’s worth is colossal. Last year, the wholesale outdoor market in Europe along was worth nearly? With Germany, France and the UK leading the way. We’re enjoying more outdoor activities than we ever have, and with travel, both long and short haul, more accessible and cheaper than ever before thanks to technology, our drive to explore the great outdoors wherever we want to shows no sign of slowing. What could possibly go wrong? 

 

Counterfeiting - an all-inclusive problem

Counterfeiting - a global problem that’s threatening nearly every consumer product across every category that you can think of - from chocolate to children’s toys, pharmaceuticals to footwear, and anything and everything in between. And it’s on the rise. Counterfeits, typically manufactured in Asia, are growing at an incredible 15% per year … and come next year, counterfeit sales are projected to reach 1.82tn. That’s right, trillion.  As online shopping has become practically second nature to most of us, a huge, almost limitless new market has emerged - and flourished - for counterfeiters. No brand is exempt, and outdoor goods and apparel are feeling the impact along with everyone else.  So what can the savvy outdoor brands do? 

 

Counterfeit products of Outdoor brands 

If you're like me, you don’t have any problem knowing that buying fake products is never a good idea. For a start, it’s not legal … but more than that, we know the quality (if there is any) will have been seriously compromised. And while it’s not quite such a big deal if the Burberry scarf turns out not to be what you thought it was (though Burberry would have something to say about it), when it comes to products from outdoor brands that customers are relying on for technical quality and safety, it could be a very big problem indeed.   

Take Canada Goose. No stranger to counterfeiting, but leading the pack when it comes to locking it down, in the past, they’ve tested counterfeit down jackets which turned out to have no down in them whatsoever. Disappointing enough if you forked out £600 for the fake, but far worse for the customer relying on said product to keep them warm, dry and frostbite free during an arctic expedition. And what about these crampons where poor quality means diminished safety, with potentially fatal consequences.  

 

The impact of counterfeiting for Outdoors brands 

It’s estimated that in 2017, counterfeit sales reached over $1 trillion. If you’re not sure what that looks like, let’s clarify. It’s the largest illegal enterprise worldwide. US businesses alone lost at over $250bn and nearly three quarters of a million jobs that same year - and all due to counterfeiting activities. But why? 

Our change in shopping habits and the myriad benefits (most of the time!) that online shopping has heralded means new opportunities for brands, but also for counterfeiters.. For the customer, when it comes to buying outdoor kit (or pretty much anything), doing so online is often the easiest way. With the benefits of vast choice, quick cost comparison and ease of purchase and return, it’s easy to see why. But this same burgeoning digital landscape is also the very reason that counterfeiting has been allowed to take root at unprecedented speed. Where else, after all, could a counterfeiter set up shop, operate anonymously and disappear without a trace, along with your customer’s money? 

When your customers make a purchase online, especially from sites like Amazon or Ebay, there’s absolutely no guarantee that your product, or the seller they’re buying from, is legitimate.  Operating amongst the genuine and legitimate sellers, there will always be those that are more than happy to take advantage of the less-than-savvy consumer. In a recent study of over 300 brands on sale by third parties on Amazon, Gartner discovered that a third of these branded products had garnered at least one customer review reporting it as fake. What’s more, when test buys were made on the websites of five major online markets, including Amazon, they discovered that nearly half of the 47 items purchased turned out to be counterfeit. 

That this matters for your bottom line, and your brand, goes without saying - counterfeiting activities can, after all, sink a fledgling enterprise. But does it matter for your customer? The capital cost of outdoor apparel - indeed most goods - is more often than not a very small percentage of the retail price. Once sales, marketing, logistics, and handling is included, we can understand why a product sells for the price it does (mostly!). But for every customer happy to pay a cool grand for a beautifully crafted, expertly fitted, technically perfect The North Face jacket, there will always be a small number of consumers who are willing to forgo that quality if it means a cheap garment with a brand logo on display, particularly now that sports and outdoor apparel has become as much a fashion item as for the purpose it was originally intended. The problem is, that same willingness increases the chance that the customer willing to pay the premium price will end up with a fake.   

But there’s another side to this, particularly for the outdoor industry. When it comes to expensive apparel and outdoors products, high prices are more often than not related to safety - and making goods safe involves a whole load more than first meets the eye.  Very often, innovative products that keep consumers safe involves extensive research and development activities, resource-intensive product testing; obtaining legal and regulatory approval (for example, climbing helmets); and providing a robust warranty service. When your brand reputation depends on your products living up to your promises, it can be devastating for everyone when a counterfeit finds its way into the hands of your customers. 

 

How brands are fighting back 

So what to do? When it comes to outdoor equipment and clothing, manufacturers are fighting back. From Barbour to The North Face to Canada Goose to Petzl, the outdoor industry knows it needs to stay one step ahead, coming up with ever more smart ways to beat the counterfeiters. From Moncler’s RFID (radio frequency identification) to the holograms you’ll find on Canada Goose apparel, technology may be enabling the counterfeiters, but it’s also driving the impetus and methods to reduce its impact.  

But for the small enterprise that will never find the capital to protect their products with chips and holograms, what’s the answer? The financial impact of counterfeiting, especially for the niche, smaller business can be a hard pill to swallow. Finding that you have to invest a significant amount of cash to track, chase and monitor those responsible for selling counterfeits of their products can seem like a very steep uphill struggle that leaves little time or money for expansion, innovation and growth. Add legal costs on to that, and it starts to become very apparent who really suffers at the hands of counterfeiters.  

  

How to protect your outdoor brand from counterfeiters 

Every enterprise today needs to protect themselves against counterfeiters - but how? Should you stop doing business in the online marketplaces, even though it gives your brand unrivalled exposure and is very often our bread and butter (almost half of sales in some cases)? 

If you’re selling a product that counterfeiters can figure out how to copy, they will. The bottom line - you can't stop it, but you can make steps to mitigate the number of counterfeits, and the impact they can have: 

 

Register your Intellectual Property  (IP)

First things first. No brand is any brand unless they’re serious about their IP, and securing it will always be your first port of call. Securing intellectual property takes significant time and investment - but it’s key to ensuring you’re protecting your brand as robustly as possible. For large enterprises that have a dedicated legal team in charge of a brand online, IP registration will be taken care of as par for the course. But smaller businesses will often need to take the task in hand themselves, and preferably in partnership with the keen eye of a knowledgeable IP lawyer. Make sure you register both the brand names and logos as trademarks. It’s also worth implementing patents that cover design and utility, just to be on the safe side.  You’ll also want to secure protection in each country that you  intend to market your products, particularly those where counterfeiting is prolific, such as China and Southeast Asia.  

 

Optimise anti-counterfeiting initiatives  

As online retailing has taken root in our digital culture, online marketplaces have been busy battling the counterfeiters with their own anti-counterfeiting initiatives. These initiatives are all about helping brands to operate securely in the online space -and they’re seeing results. One such example is the Amazon Brand Registry, an initiative that allows brands to collaborate with Amazon by providing them with information about their products in a way that helps them defend against counterfeit activities. The Amazon platform is  host to tens of thousands of brands selling millions of products. Collaborating closely with these brands means they can provide them with the insights they needed to help identify issues early on. Facebook, Ebay, and many others also operate their own programmes - and you can find out more about them here.  

 

Make friends with anti-counterfeiting technology 

To defend your brand online,  your business must embrace advanced technologies, and better still collaborate closely with third-party organisations to support. Deploying brand protection software means that very often it can take just a few hours between detection of counterfeits, and the removal of them from the marketplace - something that can take days, or even weeks, if done manually. Speed and accuracy is critical when defending against the counterfeiters, so by actively monitoring the online platforms where you’re selling your products, you’ll save a whole lot of time, headaches and sleepless nights.  

 

Educate your consumers

Empowering your customers to protect themselves means they’re helping your brand in the long run. .If you’ve shopped online, chances are that at some point you’ve purchased a counterfeit without ever knowing about it. Most consumers, unless affected knowingly, remain unaware of the negative impact of counterfeiting, and what they can do to minimise the chance of getting caught out. Educate your customers about the dangers of counterfeiting, and you’re not only protecting them, you’re mitigating the risk to your brand as you go. Providing easily accessible information on how to tell the difference between your products and the counterfeits, as well as recommending  purchases are done only through reputable and authorised resellers, are good places to start. You can find more tips and insights here.  

 

… and educate yourself 

Knowledge is power. And today, you’ll find a wide and comprehensive range of free online resources that can help every business take the preventative steps needed to avoid counterfeiting. From courses to podcasts, webinars to events, being forewarned and forearmed with up to date information is the best way you can defend your brand against the inevitable. Make the most of them! 

 

Counterfeiting doesn’t just impact your brand, it impacts your customers too. When it comes to the Outdoors industry, and the brands that operate in that space, very often, customers are relying on the quality and safety that makes the good brands the trusted  brands. Defending your brand and fighting your corner should and must be a top priority, built in to your business strategy and managed along with the rest of your business operations.  With a robust brand protection strategy at the core of what you do, you can be active in defending your reputation and your bottom line - while keeping customers educated, safe, and loyal.  

 

If you would like to find out more about how best to protect your brand online, feel free to get in touch for a no-obligations chat. 

 

Topics: counterfeits, SnapDragon, Outdoor, counterfeiting

Ailidh Mather

Written by Ailidh Mather

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