Many individuals are ignorant of the full magnitude of the damage that counterfeit goods do to brands. Counterfeiting has a number of negative effects. Suppose you’re in the business of selling something and a counterfeiter competes with you by offering customers a copy of your product at a lesser price.
Customers used to be able to tell the difference between real and phoney goods. Nevertheless, in the internet world, the distinction between the real and the fraudulent is blurred a bit. On the Internet, counterfeiters may be highly effective by copying designs and branding from legitimate businesses. They can also create fake product reviews and mix them with legitimate product ratings. The product images are sometimes taken from the business owner’s own photos, leaving the customer to assume what is real and what is not. Fake brandings in Malaysia are mostly shipped from China to sell online through websites like Shopee.
Anti-counterfeiting products are now serious competitors that may wreak havoc on a company’s financial flow if left unchecked. The fashion business alone loses around €26bn a year to counterfeiters, and this problem extends to a variety of industries.
Counterfeiting can also damage a company’s reputation. When a knock-off fails to perform properly, or comes apart too quickly, or doesn’t match their expectations, many buyers will blame the original company.
As we all know, word-of-mouth marketing is one of the most effective ways of advertising. This means that substandard copies of a product sent to these customers could lead to rumours that the real product is subpar.
Additionally, customers will post unfavourable reviews online, further consolidating this new reputation problem and reinforcing public perception that the real brand produces low-quality goods. On Amazon, a buyer can buy a knock-off from the official listing, then return to the same page to post a nasty review. So, the impact of these online reviews can really be felt.
Consequently, people search for a product, only to be disappointed when they discover that it is a fake. A refund or a new product is all they want for, and they go straight to the original manufacturer in order to get it. As a result, a number of organisations find themselves dealing with a frustrated client who complains about the poor quality of their goods, and the customer care agent doesn’t even realise that the product they’re talking about is counterfeit.
Returns are also a major burden for companies. As a result, they obtain faulty copies of their items, which have little to do with the things that they produce and for which they have not provided a warranty.
Anti-counterfeiters are a common concern for companies that have been targeted by them. Products, advertising and whatever else the corporation may have been pleased to invest in are put on hold while resources are diverted to attorneys and lawsuits to safeguard their intellectual property. A tidal flow of counterfeits offered on Amazon, eBay, and Alibaba forces legitimate enterprises to spend hundreds of thousands of dollars a year trying to stem the tide of counterfeits. Rather than guiding their organisations into the future, CEOs, innovators, and company founders must spend their time reacting to these infringements.