Cosmetics industry suffers annual financial loss of US$5.4 billion because of counterfeits. According to industry estimates, the global cosmetics industry is expected to reach approximately USD 863 billion in 2024. Estimated growth above 7% CAGR between 2018 and 2024. The growth and profitability have attracted Counterfeits in Cosmetics Industry. All they want is to extract their pound of flesh.
Fake cosmetics often contain cancerous substances such as arsenic, beryllium, and cadmium, along with prominent levels of aluminum and dangerous levels of bacteria. Counterfeiters do not mind playing with the health of customers. Considering health hazards, the onus is on customer to authenticate genuine products before using.
EFFECT: COUNTERFEITING IN THE COSMETIC INDUSTRY (ssrana.in)
Changing Landscape of Product Marketing
Emergence of ecommerce and proliferation of social media as an accessible communication medium to market and sell products has led to the enormous growth for the cosmetics industry.
The bulk of brand advertising has moved from TV and radio commercials, and billboards to Social Media Channels. Facebook, Instagram and YouTube play an important role. According to a 2018 research, social media contributes to over 50% of counterfeit cosmetic sales.
Counterfeits impact smaller upcoming brands.
CPIGS Anti-Counterfeit Technology and Solution
At CPIGS, we believe that applicable technology that allows customers to verify the authenticity of a product would be appreciated by customers and brands alike. A brand may put a unique identifier on each product it is shipping. This enables a buyers to independently verify the product identity over a web portal or mobile app in real time to tell the real ones from fakes. It could be an NFC tag or QR encoded with information that a digital device can read.