The Good, Bad and Ugly Role of QR Codes in Today’s World of Counterfeiting

Today, we are all faced with better quality fakes, accessible through a flexible and ‘self-healing’ network of online sellers, with prices no different from your average flash sale, and carrying QR codes linked to the original websites of original brands – regardless of whether that brand uses QR codes or not. All of these factors combine to subtly persuade consumers of the originality of a product.

The proliferation of counterfeiting through 2024

As the growing amount of news suggests, counterfeit trade will continue growing throughout 2024 across old and new industries, channels, and geographical regions. Comparing the market situation five years ago with today, we can observe several adaptations and evolutions.

The quality of counterfeit production has improved significantly, not just in the products themselves or their packaging, but also improvement in the flexibility of the supply chain and the self-healing effect of the online last-mile distribution network of counterfeit sellers.

Post-COVID, everyone, including counterfeiters, learned how to use QR codes more effectively and how powerful and persuasive the online environment can be, including for the repetitive launching of small online outlets with fakes.

In the meantime, we have all got accustomed to major sales events like Black Friday and Cyber Monday, as well as numerous other flash sale days throughout the year. In 2023, there were approximately 50 commercial flash sale days across the globe, with discounts of 40-70% off retail prices being nothing extraordinary, and with online sales accounting for between 25% and 33% of overall trade volume.

The challenge

It is indeed a challenging situation for consumers or anyone in the entire supply chain to tell if a product is real or not, and this growing proliferation of available counterfeits will keep attracting morally weak individuals and criminal groups as an easy opportunity to fund their other activities.

No single solution

A successful brand protection strategy requires a multifaceted approach. It needs to consist of online and offline protection, tools, and actions, while combining passive and proactive approaches.

To improve their chances in the never-ending chasing of online sellers, brands need to employ a robust anticounterfeiting solution and online communication strategy. They need to involve consumers, empowering them in the physical world, and educating them on why counterfeiting is a topic to be serious about.

Educated and empowered consumers have the capability to crowdsource brand protection activities and data at scale, which no company of any size could ever consider offering as a service. But for this to happen, every product should ideally carry an embedded authentication function available to anyone, anywhere, anytime.

Many anticounterfeiting solutions are available in the market today, but to achieve the dream situation described above, they need to balance three key areas: security, usability, and accessibility.

• Security – the level of difficulty in successfully replicating the solution.
• Usability – the clarity, reliability, and ease of use for the average consumer.
• Accessibility – the financial or operational hurdles that brand owners need to overcome to adopt a solution or educate their users to utilise it.

The following are examples of generic anticounterfeiting solutions, with their relative pros and cons in relation to these three key areas:

• Normal QR codes – easy to replicate, no protection, easy to scan, widely accessible.
• Tracked unique QR codes – replicable, easy to scan and statistically reliable with blacklisting and monitoring, but low accessibility due to high costs of traceability.
• Security hologram – hard to replicate, good accessibility, but low clarity for the average user.
• NFC inlay – nearly impossible to replicate, good usability, but higher costs and production complications.
• Secure QR codes – hard to replicate, good usability and clarity, good accessibility.

PiQR – the ‘Protected identity QR code’ generator for packaging providers

The PiQR solution, with its partner programme, empowers approved packaging providers and label printers to protect the normal QR codes of their customers as a value-adding extension to their offering.

The combination of a normal QR code with the PiQR patented copy-detection pattern ensures the irreproducibility of the code in the market and protects brand owners against the unauthorised generation of QR codes that incorporate their website address.

Any attempt to reproduce the original code, through scanning and printing, will result in a duplicated code with an irreversibly degraded copy-detection pattern, which our authentication algorithm can recognise in a fraction of a second, by comparing the duplicate to original prints. To this end, the algorithm has access to the calibration and quality assurance data of each printing machine of approved partners, in order to compare the original print of any QR code to a fake.

The authentication functionality of the solution works as a basic additional step to normal QR code scanning and existing landing pages.

The consumer is first forwarded to a trusted page (eg. https://BRAND.com) whose authenticity they can easily confirm. From there, the consumer launches a ‘trusted’ web-based authentication app with a click of a button, which guides them through the authentication process.

We believe that providing a reliable and accessible way for anyone to authenticate products anywhere in the supply chain, and at any time, will significantly improve the counterfeiting situation for any company. There will be no more blind spots or excuses for not being able to check the authenticity of a product. With PiQR, we aim to make this possible through a global network of trusted partners who can supply reliable technology to trusted brands.