‘Less is more' - Fewer counterfeits online means increased revenues for brand owners

Just in case anyone hadn't noticed, there's a recession on... And not just a small one either! Some reports have our economic 'prosperity hiccough' as the worst since the great depression many countries experienced after world war one.

However, one thing has changed radically in the intervening years - our growth in consumerism. Brands permeate our daily lives; our choice of brands defines our societal status, our perceived affluence, our cultural heritage and point at our aspirations.

In an economic recession however, our desire to acquire aspirational goods and services is often outweighed by our inability to afford them. Enter the counterfeiter ... The fairy godfather that can wave a magic wand and answer every consumer's prayers ... Branded goods at fire sale prices. It's no surprise that during hard times output of counterfeit goods increases massively.

And ... just like the water companies, which only seem to spend money on reducing water wastage through their pipe networks when there is a drought, consumer and luxury brands often react and spend wildly and without precision on trying to reduce counterfeits in the marketplace only after their revenues have been hit.

Occasionally these sporadic actions have a positive effect; however, brand owners see much better results from a sustained program of activity, making it difficult for  counterfeiters to place their fake goods in the shop window, which often causes them to switch their attention to softer targets.

Prevention, as the old adage goes, is better than cure. Defensive registration of key domain names, to stop counterfeiters buying them, hosting a look-alike website and selling fake online goods, may cost some money to achieve and maintain, but it is a small amount compared to the money, time and effort it takes to recover a domain name through the courts.

With a little thought and action, defensive domain name registrations can actually drive traffic to the brand owner’s main site, increasing online sales revenues and maintaining brand quality while preventing counterfeiters from making money.

Taking action against fraudsters on marketplace sites such as eBay, Amazon and Alibaba will reduce the volume of fake goods on sale, cleaning up the sites for the site owners, making the sites more attractive to consumers and ensuring that legitimate resellers get access to the buyers frequenting these sites – increasing brand owners’ revenues and consumers’ confidence.

What we see here at NetNames, is many brand owners doing too little, too late and for too short a period. It’s akin to firing a machine gun at a room full of mosquitoes in the dark – you might hit one or two but the rest will bleed you dry before morning.

The key to it all is visibility and selection of the right weapon for the task – At NetNames we switch on the lights and provide the bug spray.

Written by Andy Churley, Marketing Director, NetNames

21 August 2012