How Retailers Can Prepare and Prevent Counterfeiting


E-commerce has been dramatically accelerated during COVID-19. More than half (58%) of consumers admit to buying more goods online than usual due to the pandemic, signaling people have adapted to online shopping and new purchasing behaviors. In fact, September alone saw a record 28% surge in online purchases compared to 2019. 

As e-commerce sales rise, counterfeiters find more opportunities to make a profit, essentially stealing sales from legitimate brand owners and potentially harming customers. In 2019, there was an estimated $509 billion worth of counterfeit products on the global market.

Unfortunately, counterfeit goods can be difficult to spot. Oftentimes customers and retailers often do not realize when their products or the supply chain have been tampered with, leaving many counterfeiting crimes unnoticed. Shoppers and retailers are more vulnerable than ever to online scams given the increased volume of online purchases and putting consumer health and safety, customer loyalty and company revenue at risk. 

Luckily, new innovations are helping retailers to authenticate products, and track and trace supplies throughout the supply chain. While some companies have added staff dedicated to authenticating products, this isn't necessarily the most effective way to prevent fraud.

Human authentication services can create added costs for a business and increase the risk of human error, as counterfeiters can create passable products. Similar to any other security measure, it’s critical for e-commerce companies to make the right precautionary investments now to protect their customers and business.  

Create Ways for Your Buyers to Authenticate Purchases

One way to guarantee authenticity is to have codes attached to internal packaging slips or product labels, which can reassure customers that they’re buying (and receiving) legitimate products. An invisible code benefits the brand owner, protecting the company from liability if a consumer is harmed from a counterfeit product (makeup or skin products).

A visible code can authenticate the product instantly by scanning from a consumer’s smartphone camera. If there was a slip-up in the delivery process, this code would read as an “error,” notifying the customer this is not a legitimate product.

Not only does this protect the retailer’s product and brand, but also retains and gains customer loyalty. 

Identify Ways to Create Transparency in Your Supply Chain

A whopping 79% of Americans say it’s important for brands to provide guaranteed authenticity when purchasing goods. Within this group, 71% are willing to pay more for products that offer full transparency and traceability.

Implementing tracking and tracing technology allows for consumers (and retailers) to follow the product along its journey and ensure it wasn’t diverted off-route. For consumers, this real-time tracking ability confirms that their product will be delivered with full authentication.

As e-commerce remains a popular way to shop, retailers must not only protect their physical supply chain, but also have the right tools to monitor online activity to determine fraudulent sites that could be selling counterfeit products. 

Whether it’s due to Americans spending more time at home or shopping behavior shifting altogether, e-commerce is booming. The future of online shopping depends on the retailers’ and sellers’ ability to protect their products, and their customers. 

Patrick White is CEO of VerifyMe.

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