Counterfeit beauty products tackled with blockchain and smart packaging says GlobalData

By 2024, online will account for 15.3% of UK health and beauty spend, according to GlobalData, but with this e-commerce boom would come a rise in counterfeits – a problem that stretched far beyond the UK, given the globalised nature of online shopping.

COVID-19 has created a ‘captive’ online audience

“Counterfeit beauty is not new,”​ said Yamina Tsalamlal, associate analyst at GlobalData – e-commerce and social commerce just made it “easier to deceive consumers”.

“Add in COVID-19, with consumers spending more time shopping online and scrolling social media, you’ve got a case where the risk is heightened,”​ Tsalamlal told CosmeticsDesign-Europe.

And this was especially true for younger consumer generations – Gen Z and millennials – who spent much more time shopping online and were influenced by trends and social media, she said.

“This is a perfect time for counterfeit brands to take advantage of a captive audience and with supply chains disrupted and retailers struggling to keep up, the conditions make it easier for these brands to slip through the cracks.”

‘Innovation is key’ – blockchain plus smart packaging  

Tsalamlal said: “This is where innovation is key”​ and the power of blockchain technology and smart packaging truly came into play.

“Blockchain allows for the tracking of the product’s provenance to ensure transparency. This can be used at the consumer level as well as by brands and retailers through something as simple as QR code or specialised labelling that can easily track each step of the supply chain,” ​she said.

If this was then coupled with one-of-a-kind packaging that was “impossible to replicate” ​and a way that consumers could easily scan, trace and read a product’s story on their smartphones, ​brands protected themselves from counterfeiters.