Luxury brands are fighting counterfeits, find out how?

The supply chain has never been as far-reaching and complex as it is today. Undoubtedly, this global network allows for an unprecedented availability of international products and accessibility of goods. But it does not come without its fair share of challenges – including counterfeit, which might be a luxury brand’s worst enemy.

While the fake goods market continues to thrive, emerging technologies have given brands more tools to protect their profits, reputation, and consumer experience. While anti-counterfeit blockchain solutions are a revolution still in its infancy, this emerging technology is opening up unparalleled opportunities for brand protection and product authentication. How? Let’s look at the potential of anti-counterfeit blockchain solutions in this guide by

Counterfeit by the Numbers

In 2018, the Global Brand Counterfeiting Report showed that luxury brands were losing around $30 billion in sales to the fake goods markets. However, over the past two years, the rapid growth of eCommerce triggered by the Covid-19 pandemic fuelled a sharp rise in fake goods sales through online channels. These economic changes caused sales losses upwards of46.6 billion euros in 2020.

What’s more is that the trading of counterfeit and illegal goods is estimated to account for over 3.3% of the world’s trade. And, when looking at the counterfeiting of goods in sectors such as FMCGs, agriculture, spirits and wines, cosmetics, and pharmaceuticals, the fake goods market can also lead to a substantial public health risk.

Undoubtedly, financial losses are the immediate consequences of fake goods trading. However, goods diverted away from the supply chain, adulterated products, and manipulated items can cause much more damage to a luxury brand, including:

  • Fake goods are often poorer in quality, which can affect the consumer’s experience
  • Counterfeit goods might account for a percentage of the brand’s market share, thus reducing profits, sales, and revenues
  • The circulation of luxury counterfeit goods can affect the company’s reputation
  • Adulterated goods are unregulated and can lead to public health issues

The Role of Blockchain in Fighting Counterfeit

While the fake good market is a threat as real as ever for brands, today, some emerging technologies can help brands fight back. Among the most efficient product authenticity solutions is blockchain.

At its core, blockchain is nothing more than a simple database. However, there are three important characteristics that make blockchain an extremely instrumental tool for anti-counterfeiting solutions:

  • Blockchain allows for encryption, which ensures the privacy of transactions and users
  • Blockchain data is decentralized, meaning that the decision-making power belongs to the users, not to a centralized entity
  • There is a single valid record for each transaction, which is shared among all users

As a distributed and immutable digital ledger, blockchain is extremely useful to safely record transactions. What’s more is that each transaction record is transparent, timestamped, and unforgeable, making it easier for consumers and brands to track a product’s journey through the supply chain. For even more information, visit

Anti-Counterfeit Blockchain Solutions: What To Expect

All blockchain solutions boast those distinguishing traits. However, there are also some specially-designed solutions that are considered to be the most secure blockchain against counterfeiting  – here’s why.

IoT- and NFC-Enhanced Blockchain

Anti-counterfeit blockchain solutions combine blockchain databases where transactions are recorded with IoT (Internet of Things) devices and smart packaging solutions.

For example, NFC (Near Field Communication) tags and RFID (radio frequency identification) labels can enhance a product’s packaging and give end-users accessibility to the transactions recorded on the blockchain. Unlike previously used QR codes and barcodes, NFC and RFID tags are virtually impossible to manipulate, and all that’s needed to read the information encrypted is a simple modern smart phone with an internet connection and the NFC function, currently used for contactless payments.

Digital Twins and NFT

Alongside NFC and RFID tags, NFTs are attracting growing attention. Non-Fungible Tokens refer to an encrypted serial number that can be used to link a real-world asset (such as a product, i.e.: a luxury bag or premium bottle of wine) to its digital twin – or a virtual representation that can be easily tracked through blockchain transactions.

A Tailored Solution for Your Brand’s Needs

Lastly, no anti-counterfeit blockchain solution will be efficient if it isn’t adjusted to your own brand’s needs. After all, each company is unique, and you might need a database solution that adapts to your specific supply chain, distribution channel and end user’s needs.

Moreover, you might need to control data access and implement a private blockchain solution that is suitable for your company’s internal needs.

Lastly, while consumers are always looking for greater supply chain transparency, it is important to make the tracking of a product easy, accessible, and in-line with the experience proposed.

Bottom Line

Ultimately, the most efficient anti-counterfeit blockchain solution is the one that is tailored to your company’s needs, features advanced IoT technologies, and only enhances the customer’s experience. Partnering with a product authentication expert at Authena can help you find a bullet-proof solution to help you protect your luxury brand from counterfeit.

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