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Counterfeit Korean Cosmetics: A Case Study

by | Dec 30, 2019 | CASE STUDIES | 0 comments

Smart Packaging for Cosmetic Industry to Fight Counterfeits and Engage Consumers

We have compiled a case study involving a Cosmetic Company who decided to add an extra layer of protection for their brand and their consumers. This case study gives an interesting perspective into how using Anti-Counterfeiting solutions improves the overall performance of the company and the creation of a loyal following. 

BACKSTORY

The beauty and cosmetics industry has “blown up to be a $532 billion industry” according to Business Insider and is showing no signs of slowing down especially with the rise of beauty vloggers or “influencers” who are using social media to promote products.

Our client, a Korean-based cosmetics brand company, is also benefiting from this upward trend but is also facing challenges. The industry “is a lucrative business” to be in right now, but with it comes the rise of counterfeits. It’s difficult to assess the monetary costs these counterfeits affects reputable brands but their impact to the industry cannot be denied.

These counterfeiters not only tarnishes a brand’s good name but also has a scary side effects for consumers. Consumers have no idea what are in these counterfeit cosmetics which may contain harmful chemicals or even bacteria because of the unsanitary way of making them. 

Company Overview

Headquarters: South Korea

Industry: Cosmetic products

Employees: Confidential

Annual Revenue: Confidential

Challenges Faced by the Industry

Just like any other organization, the proliferation of counterfeit products greatly affects the sales performance products and the company as a whole. These challenges include (but not limited to): 

  • Fake products being sold on multiple platforms and readily available
  • Fake products being sold at a “discounted” price
  • Local markets selling the products as “Class A” or “same product but cheaper” 
  • Counterfeits enter authorized sales channels (i.e. beauty salons, retailers)
  • Customers unknowingly buying counterfeits since “it’s cheaper because we’re directly getting from the supplier” 
  • Distinguishing between real and fake products
  • Figuring out diversion and parallel trading
  • Increasing customer engagement real-time 
  • Monitoring the customer behaviors across geographies in real time

NanoMatriX Products Used:

  • TrackMatriX® Geo serialization
  • Custom verification workflow
  • Inventory serial number
  • Multi-product reporting
  • Counterfeits & engagement reporting

Results:

  • Data driven decision & insights
  • Multi level secure brand protection
  • Dynamic real time consumer engagement
  • Supported by high security anti-copy features

THE SOLUTION

Dynamic Real Time Consumer Engagement Platform

Marketing relevant data including geographic and behavioural information are collected and can be analysed through the TrackMatriX® Insights. The scalable track & trace system is cloud-hosted and secured to authenticate products and can engage with consumers. Using these NanoMatriX services, the consumer can make accelerated decisions to make additional purchases.

High Security Anti-Copy Features on our Labels

With our experience as a security printing expert, we know that overt, covert and forensic multi-level security features applied by NanoMatriX will diminish counterfeits. We offer an extensive variety of security technologies and these features are extremely difficult to be copied by counterfeiters. 
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