How digital fingerprints can destroy the counterfeit world of luxury goods
A trillion-dollar problem
We’ve all heard stories about knock-offs and counterfeit items falling into the hands of those who thought they were getting the real deal — especially when it comes to major name brands.
The shady world of counterfeits is costing the luxury industry an insane $100 billion USD each year. An entire industry is built around the trade of fake goods — now estimated to be around $4.5 trillion. And fake luxury items account for at least 70% of that.
Now that’s a lot of cash. And entirely fake goods spanning from footwear to pharmaceuticals:
Flooded with fakes
So what does this all mean?
It means that trust is being lost in brands. Without a way to know if your $500 will get you an authentic item or just a really good replica, people are growing wary. To put it simply, people are getting ripped off like never before. 66% of consumers who had been ripped off after unintentionally purchasing counterfeit goods have lost trust in buying from that brand again. There’s a strive for transparency in the supply chains.
To make matters worse, there’s been an explosion of “super-fakes” — high-end luxury items that look exactly like the real thing. According to Jack Ma, the founder of Alibaba, super-fakes, and counterfeits are getting so good at looking real because they’re actually made in the same factories with even the same raw materials.
Luxury brands are being hollowed from the inside out. If nothing is done to control the production of counterfeits, more and more brands will die. The longer the counterfeit industry is fueled by these fake luxury goods, more innocent people will be harmed by working in dangerous and unregulated working environments.
“Counterfeiters thrive where there is poor governance. It is vital that we do more to protect intellectual property and address corruption.” — OECD
Removing the pain
But there is some hope.
Huge players from the luxury brands industry have finally found and developed a solution.
Louis Vuitton (LVHM), the French luxury conglomerate, has already addressed the crisis on counterfeit goods by teaming up with Microsoft and ConsenSys (a blockchain software company) to develop the AURA blockchain-based platform — a solution that allows consumers to access a luxury good’s history and proof of its authenticity — from raw materials to the point of sale, all the way to second-hand markets.
DHL is also already on board to combat the issue by working with Accenture to track pharmaceuticals from the point of origin to the consumer, thus preventing errors and tampering.
But are current solutions enough to eliminate counterfeits for good?
The thing is, most security companies and tech solutions have outstanding intentions but have several drawbacks that prevent it from being 100% secure.
All of these approaches require a physical element to be placed on the item itself — whether it’s a barcode, QR code or even a chip.
But these could be copied, removed or tampered with.
A record in a blockchain database itself is enough to solve the issue.
The future is non-invasive
We believe in non-invasive technology.
It’s as simple as taking a photo of that luxury handbag to get all the necessary information — where and when it was manufactured, which store it was bought from, who the previous owner was, and, last but not least — is it authentic?
Compared to all other solutions, our approach leads the way as we completely remove the risks and drawbacks to fully protect luxury goods. In a nutshell, Veracity Protocol’s solution analyzes the material surface structures of any item with a basic camera and uses it for protection and future verification.
Any item’s material structure can be stored as a digital fingerprint. The item itself is the digital record.
We replace all of the old security elements like chips, tags, QR codes, labels, holograms, and invisible markers.
There’s a $4.5 trillion criminal industry. Now, any business can bring transparency to their supply chain, protect their brand and — most of all — their customers.
People are tired of getting the short end of the stick. People want to know what they’re buying.
We give trust back to them.
Follow Veracity Protocol
Veracity Protocol brings a new authenticity standard of fingerprinting physical objects to combat counterfeits. Thanks to computer vision and machine learning, we identify unique material characteristics and use them for future protection, verification, and visual inspection. Unlike tags, chips or markers that need to be embedded and can be removed or tampered with, our solution works with items’ surfaces even when damaged and is still 100% tamper-proof.