How large-scale counterfeit networks operate

Rounding off our investigation into counterfeiting issues at the Football World Cup, we investigate how an illegal large-scale network selling fake replica shirts has been operating and how it could have been stopped.

Replica shirts are a popular target for counterfeiters, and this only increases during the hysteria of a World Cup. At the start of the tournament our analysts began monitoring a cluster we first identified during Euro 2016 that was selling replicas shirts and tracked how it has evolved since then, whilst also identifying new behaviours and methods within their operation. It appears that these infringements were being monitored and enforced by someone, though without the benefit of clustering intelligence that Incopro can provide.

How does the network operate?

This cluster has retained the same business model since 2016; utilising a combination of social media and websites to promote and sell their illegal merchandise. However, their operation has evolved as various channels have been closed, and in turn replaced. The individuals at the centre of this cluster are operating out of China but targeting the lucrative European and North American markets.

These individuals use websites as e-shops to complete transactions and funnel customers to them via their social media platforms. We identified six Facebook accounts and thirty-three websites, although very few of them were the same as had been operating in 2016. Throughout the tournament our analysts noticed that if a website was closed then the social media platforms simply switched their promotion efforts to another within the network.

This shows the importance of eradicating an entire network at once: if one or two accounts are closed then you are causing an inconvenience to a counterfeiter, not having a real impact by putting an end to their operation. This is the problem with fighting counterfeiters without an intelligence led strategy, you shut down individual accounts ad-hoc and are unable to understand the full scale of the issue.

How to fight large-scale networks

Taking an intelligence led approach to fighting large-scale counterfeiting networks is the only truly effective way to shut down these operations. Incopro does this using our unique clustering technology. By connecting all elements within the network, you are able to enforce strategically at scale, rather than using a ‘whack-a-mole’ approach. This addresses the source of the issue and brings long-lasting results.

There were clear signs that someone was trying to fight this cluster during the tournament, but with an ad-hoc approach they made very little progress and as we explained last week, did not feel threatened enough to even change the contact details they were using across the network. Incopro constantly monitors clusters such as this so we can continue to understand the behaviour of counterfeiters and identify any new trends, ensuring we stay ahead of the curve and deliver real impact that clients need to defend their IP.

Click through here to read our other posts around counterfeiting issues during the football World Cup, or find more information on our website about how we can help you protect your business.

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If you would like to learn more about how Incopro helps protect against counterfeits, please contact us.

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