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  • Writer's pictureVijay Vaswani

AI vs Counterfeits: Can AI help luxury brands win the war against counterfeit goods?

In recent years, there has been a notable surge in the manufacturing and distribution of counterfeit luxury fashion items. According to Certilogo, a product authentication platform, the fashion sector suffered a loss of over €45 billion in 2020 alone due to counterfeit goods.

The rise in online purchasing of luxury items has contributed to the expansion of the counterfeit market, with the value of fake and pirated goods soaring to €2.75 trillion in 2023, as reported by the Business of Fashion website.

Amid mounting concerns about the detrimental impact of counterfeiting on the fashion industry, some brands are turning to artificial intelligence (AI) as a solution to identify and combat fake products.

The harmful side-effects of counterfeit goods

Counterfeits were described as bad quality and easily detectable with a huge gap in quality when compared to genuine items, however, recently it has become increasingly challenging to differentiate between them with the help of newer, more advanced technology.

Luxury brands are most at risk as it isn’t only the products that are being copied but also the websites that deceive a large number of customers into paying full price for a product from a fake website. This has a huge impact on the brand’s image as the high-quality item can not be matched, which potentially gets people to think that the brand sells low-quality products. According to Certilogo, around 20% of products advertised on social media platforms are fake.

Luxury brands and their customers are not the only ones that are harmed through counterfeit goods even the environment and workers who produce them too. Counterfeit items are typically made in unregulated factories where the working conditions are hazardous and poor. The environment takes a toll as low-quality items usually have a much shorter product life span and would often be thrown away. These practices are often performed in fast fashion which is known to be environmentally damaging.

How are brands fighting back against counterfeits?

In today’s day and age, technology has advanced enough to a point where artificial reality (AR) can help verify the authenticity of products. Machines are created to analyze and determine the authenticity of products by focusing on images, texts, and videos to check for flaws that are harder to find using human judgment. These machines also have the capability to pick up the serial numbers, purchase orders, and payment information to identify any abnormalities.

Smart labels are also one of the methods companies use to verify authenticity using unique QR Codes on each item which can display the origin of the item and confirm the authenticity. 

Brands like Burberry and Louis Vuitton have explored and currently promote and use systems of such technological advancements in order to keep their customers safe as well as provide them with a better shopping experience.

Though many are not certain about the uses of AI within the fashion industry, it is safe to say that there are benefits that AI brings that help the industry move in a more positive direction.

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