Counterfeiting up by a third since start of pandemic: report
Two in five companies have seen an increase in cybercrime against their business since the start of the COVID-19 pandemic, according to a report from brand protection company Red Points.
“ The Day After COVID-19”, which surveyed 150 e-commerce “leaders” who represented companies of different sizes and product categories in the US, found that 39% of respondents have seen an uptick in counterfeiting.
Counterfeiting, phishing, impersonation, parallel imports and grey market, and data breach are the five main cybercrime issues suffered by companies.
A majority (51%) of respondents who’ve seen an increase in cybercrime admitted it has damaged their business reputation, while 46% said counterfeiters are stealing sales.
Laura Urquizu, CEO of Red Points, said: “Brands are in dire need of protecting their online revenue and reputation, while also preparing for the complete transformation the future of ecommerce holds.
“Creating online strategies to keep ecommerce momentum going will be no easy feat, but forging a path that includes making a conscious effort to reignite consumer spending, and vigilantly defend against cybercrime and counterfeits, will pay high dividends in the future.”
The ‘new normal’
According to the report, if cybercrime continues to increase over the coming months, more than two-thirds of respondents said they would maintain or start taking on anti-counterfeiting prevention, making it the number one action brands would maintain or increase if cybercrime continues to grow.
Breaking it down by size, 88% of companies with between $51 and $250 million in revenue would maintain or enhance anti-counterfeiting efforts.
Red Points added that companies in medicine, entertainment, and baby care are the most interested in anti-counterfeiting and online reputation.
The survey shows brand protection and online reputation is hugely important for medical companies (80%), consumer electronics (78%), and toys and board games (73%).
In positive news for some brands, nearly six in ten of the respondents said that e-commerce revenue has increased for March 2020 compared to last year, with baby products, food and beverage and consumer electronics seeing the biggest jump in revenue.
Nearly 60% of respondents are investing more in e-commerce channels to ensure business continuity in light of COVID-19, while 49% are diversifying suppliers and 35% are taking measures to minimise cybercrime.
“Companies that sell 51% or more online were almost twice as likely to decrease their offline retail presence than companies that sell 50% or less online,” said the report. “But no matter the portion of ecommerce revenue, most companies are investing more in ecommerce channels.”
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Counterfeiting up by a third since start of pandemic: report
