Maintaining the wellbeing of a Brand
The wellbeing of a company’s brands is the senior managements’ responsibility. Senior management understand that brands are the company’s most valuable asset and a brand which is successful in the marketplace is liable to be copied. Following initial success, management often take steps to protect the brand through both legal means (e.g. trademarks and copyrights) and by employing various security processes and physical devices on their branded products. Successful application of brand authentication devices usually results in a significant increase in sales and growth of market share by curbing counterfeits.
After some years as the brand finds its niche, settles into its segment and counterfeiting activity is limited due to anti-counterfeiting actions taken earlier by senior management. Its market share stabilises around a level and growth trends towards that of the underlying market. It is at this point that complacency often creeps in; the danger from counterfeiting is a distant memory within the organisation and with slowing growth the focus shifts toward cost-cutting. At this time a zealous company employee, who doesn’t understand the risks from counterfeiting or the benefits of the existing anti-counterfeiting specifications, may proactively review the costing and possibly arrive at a conclusion that the company can possibly benefit if it could reduce cost of the brand authentication device that has been employed. In most cases costs may be reduced and substantially so if the specification is downscaled. Initially, an improvement in profit may be seen from the reduction in costs, but as counterfeiters become wise to the lower security levels, they will once again target the brand potentially impacting sales, market share, reputation and customer safety.
A brand authentication device that has successfully combated spurious and counterfeits and enabled the Brand to grow maintaining its market share should not be tampered with. As is often the case in such matters, the security is in multiple layers and only certain features are made public, even within a company (it should be on a need to know basis). It is critical that a successful brand authentication device is not de-specified, if it has thwarted duplicates and counterfeits to date; change for the sake of cost reduction can be detrimental to the brand. It is important to ensure that responsibility and decisions are not being pushed down the management chain, where incentives are often different and not holistic as far as the company needs.
Therefore, it is imperative that senior management continue to be engaged with brand protection and monitor its wellbeing.