E-commerce marketplaces have the benefit of reaching a vast number of consumers online; which raises brand awareness and sales on a global level. However, it also offers counterfeiters the opportunity to sell infringing products quickly and cheaply, with the high level of anonymity the Internet provides, resulting in particular challenges for brand owners.
In e-commerce transactions, there is a particular problem intercepting counterfeit products as they are largely sent by post in small shipments. Postal authorities and customs face an uphill battle to screen / identify counterfeit products amongst the millions of legitimately traded products. With this in mind, e-commerce marketplace operators are uniquely positioned to prevent counterfeit products from being advertised and sold on their platforms, to tackle the issue earlier in the supply chain / customer journey – and luckily for brand owners, most platforms see it as being in their mutual interest to stamp out bad actors.
It is imperative that brand owners are aware of the tools that e-commerce platforms have in place to identify, report and remove counterfeit goods from sale. The UKIPO has published some recent guidance here and summarised further below, which sets out the specific tools the various platforms use, most of which utilise AI, in order to combat the sale of counterfeit and infringing goods.
Close collaboration with e-commerce marketplaces is also essential. In particular, providing as much data as possible in order to assist the tools utilising AI for more effective identification of infringing goods. The key to successful deployment of AI tools in identifying counterfeit goods is data. The more data that can be produced on key features to look for in genuine vs fake goods (i.e. in the photographs, listings and reviews etc.), the better. The more the AI tool “learns”, the less human input is required, allowing those resources to be re-directed elsewhere.
The future of AI tools
Clearly, AI is not able to solve the issue of counterfeit goods entirely. It is a constant effort to combat counterfeit goods with new entrants to the e-commerce market able to set up at speed. Counterfeiters are becoming ever more sophisticated over time, for example, by using AI for non-legitimate purposes such as to generate fake photographs, videos and even reviews to legitimise their counterfeit or infringing goods. This is set against a backdrop of a growing cultural acceptance of counterfeit and infringing goods, particularly in the current cost of living crisis.
However, AI tools and technology are developing quickly and can greatly assist. For example, behavioural analytics can be used to identify goods which are most likely to be targeted by counterfeiters, AI assistants can scan goods in real time to determine authenticity and AI can assist with supply chain tracking.
For brand owners, the key is to have a cost-effective strategy in place for monitoring and enforcing IP rights. This includes at all stages of the customer journey, online and offline, but with a particular focus on online e-commerce marketplaces, preventing the consumer from purchasing infringing products in the first place.
E-commerce platforms’ anti-counterfeiting tools
The UKIPO’s new Guidance provides a helpful overview of some of the tools available with platforms like Alibaba and Amazon leading the charge with AI.
Social media providers have historically often lagged behind online marketplaces. However, Meta, the global conglomerate which operates Facebook, Instagram and WhatsApp, has recently revamped its suite of tools to make the online reporting of infringements simpler for brand owners. The launch involves three platforms: an update to the Brand Rights Protection tool; a new IP Reporting Centre and several updates to the Rights Manager tool. The Brands Right Protection tool has been updated with AI to better identify and therefore report content which may be counterfeit, infringe trade marks or copyright and protect from impersonation and the new IP Reporting Centre should make it easier for brand owners to report and track infringements.
These developments should go a long way towards tackling the issues and assisting brand owners and consumers alike. However, brand owners do still need to be careful about the nature of the complaints made through these platforms as, if there is any doubt as to the legitimacy of a complaint, such reports can constitute actionable unjustified or groundless threats, in much the same way as sending a cease and desist letter.
For more information or if you have any questions, please contact Emily Roberts or Holly Webb.
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