Advanced packaging and labeling features help companies combat threats to brand security and diversion
By Stan Chess, Applications Engineer, RRD Label Solutions
Today’s global distribution chains are as complex as ever, enabling brands to reach consumers in all parts of the world. However, this complexity can enable counterfeiting, theft and diversion. These issues impact a slew of markets including apparel, footwear, food and beverage, pharmaceutical and medical devices, aerospace, components, petroleum and consumer electronics.
Counterfeiting, as defined by the World Trade Organization, is an unauthorized representation of a registered trademark carried on goods identical or similar to goods for which the trademark is registered, with a view to deceiving the purchaser into believing they are buying original goods.
Counterfeit goods can be a source of consumer confusion and, even worse, a health risk when the goods in question are medications, food and cosmetics. Theft can also be categorized as the false labeling of products or the utilization of undesired materials or components used to produce a product coupled with wrongful use of a trademark. Diversion is yet another concern relating to security in which a product is removed from its intended supply chain and directed to an unintended market unbeknownst to the original producer. Diversion can raise serious allegations of regulatory violations, create product shortages in intended markets and hurt revenue streams.
Regardless of the security concern in question, the affected companies can face costly and lengthy litigation, negative publicity and possibly an irreparable loss of loyalty from consumers. These challenges are not necessarily insurmountable, but they are best avoided. Through proactive measures to advance labeling and packaging solutions, brands can better defend against the proliferation of counterfeit goods and other threats to product security and the resulting damage.
The first step toward better brand security should be understanding the challenges of the marketplace and vulnerabilities of the current supply chain. When thinking of counterfeit goods, clothing and electronics often come to mind, but even food, cosmetic and pharmaceutical brands can be (and are often) counterfeited. Companies that underestimate the risks of their industries and supply chains may not take the preventative measures necessary to avoid danger to both their brands and potentially consumers until it’s too late.
As consumers shift more of their purchase making to eCommerce channels, this trend opens up an opportunity for the proliferation of counterfeit goods online — especially on third-party e-tail sites. Although companies and consumers can and do press for reform, transparency and verification on those channels, it’s imperative for brands to also take action in guarding their integrity.
Overt Features Alert Consumers
Overt security methods provide visual cues to indicate whether a product has been compromised and can serve as points of differentiation for consumers to distinguish between an authentic product and a counterfeit. These features include retro-reflective materials that verify authenticity and labels made with destructible substrate. Another example includes tamper-proof labels, such as those that leave a residue upon opening, which can be especially important for packaged goods in the petroleum and aerospace markets.
Covert Solutions Enable Verification
Manufacturers can also incorporate print-based security features — typically known as covert methods — like hot and cold foil printing, as well as microtext or coding. Microtext characters can be inserted into overt images, text and other design elements that are not readily apparent to the naked eye. This method is difficult to replicate or copy without using advanced production equipment. Ink-based security features offer another level of protection. Advances in printing technologies allow packaging engineers to incorporate color-shifting, penetrating, thermochromic, visible or invisible, UV fluorescent and pen- or rub-activated inks for additional forms of verification.
Track-and-Trace for Reassurance and Rapid Response
Brands can also implement serialization and numeric coding at the point of production to mark and code each individual product, especially in industries that are highly regulated such as cannabis and pharmaceuticals. Depending on the product, the implementation of multiple layers of security may be necessary.
Certain technologies — such as QR codes — can be designed to enable communication about the product, for example allowing consumers to receive information on its origin and verify authenticity. Along with QR codes, radio-frequency identification (RFID) — which uses electromagnetic fields to identify and track tags attached to an object — is gaining traction by providing traceability. While security may connote fearfulness, certain security methods are actually also enabling greater transparency between the manufacturer, brand, and consumer, allowing for verification and authentication of products in an increasingly overcrowded marketplace. Sophisticated track-and-trace measures such as these also enable companies to identify compromised product batches and remove them from the marketplace whenever a problem does occur to minimize the impact of the incident.
Staying Ahead of the Curve
Brand owners may implement one or multiple security measures to avoid counterfeiting, theft, and diversion. However, bad actors will often be nipping at their heels. Therefore, brands must assess their packaging and labeling operations regularly, stay attuned to consumer feedback, and update security features often. To stay abreast of these technologies, brand owners should look to trusted suppliers that are developing and implementing the anti-counterfeiting technologies of tomorrow.
RRD is a leading global provider of multichannel business communications services and marketing solutions. With more than 50,000 clients and 39,500 employees across 34 countries, RRD offers the industry’s most comprehensive offering of solutions designed to help companies optimize customer engagement and streamline business operations across the complete customer journey. For more information, visit the company’s website at www.rrd.com.