As the holiday shopping season kicks into high gear, consumers face a growing threat from counterfeit products that are becoming increasingly difficult to detect. This global menace is estimated to be worth a staggering $2 trillion annually, posing risks not only to consumers but also to the economy. In response to this escalating problem, both online retail giants and innovative startups are harnessing the power of artificial intelligence (AI) to combat counterfeit products and protect unsuspecting shoppers.
Amazon’s counterfeit crime unit
Three years ago, Amazon launched its in-house counterfeit crime unit, comprising former federal prosecutors, law enforcement professionals, and data scientists from around the world. This specialized team utilizes AI and machine learning to identify and root out sellers attempting to peddle counterfeit goods on the platform.
Amazon’s AI-driven tools are constantly monitoring data and scanning over 8 billion listings from sellers daily. Machine learning and data analysis enable the platform to scrutinize logos and trademarks, comparing them to the information provided by brands, allowing it to flag potentially counterfeit products. This proactive approach aims to protect customers who may unknowingly purchase fake items.
Entrupy, a pioneering company founded by Vidyuth Srinivasan, focuses on the luxury accessory and sneaker markets. Leveraging AI and machine learning, Entrupy has built a comprehensive database of images of both authentic and counterfeit luxury items. This extensive database powers a handheld device that consumers and retailers can use to spot fake products in real-time.
Entrupy’s database encompasses thousands of distinct characteristics from authentic and counterfeit products, enabling computers to detect even the most minute differences in images. By providing a reliable solution to identify counterfeits, Entrupy seeks to protect consumers from potentially dangerous fake items.
The growing threat of counterfeits
Counterfeit goods have evolved from being sold on the streets and in back alleys to a thriving direct-to-consumer online trade. Ashly Sands, an intellectual property attorney, notes that the availability of counterfeits online has reached an alarming level, with a 99% chance of finding a counterfeit version of a genuine product.
The consequences of the counterfeit market extend beyond financial losses, as counterfeit electronics, for instance, contribute to over 70 deaths and 350,000 serious injuries in the United States annually. Counterfeit pharmaceuticals are also a grave concern, with the potential to contain deadly substances like fentanyl.
CBP plays a critical role in targeting and seizing imports of counterfeit and pirated goods. However, the rapid growth of the counterfeit trade through e-commerce platforms has presented significant challenges. CBP processes are ill-suited to combat counterfeit goods in small packages, with nearly 2 million packages arriving daily.
To address these challenges, CBP is adopting new technologies, including AI-powered X-ray machines. These advanced machines can analyze the features of genuine products, enabling faster and more efficient detection of counterfeit goods. CBP emphasizes the need for collective responsibility, with consumers, retailers, and marketplaces all playing a role in ensuring the legitimacy of products sold online.
The limitations of AI in combating counterfeits
While AI technology offers a powerful tool in the fight against counterfeit products, it may not completely eradicate the problem. Vidyuth Srinivasan acknowledges that while AI can significantly contribute to solving the issue, it may not eliminate it. Nevertheless, the concerted efforts of industry players, law enforcement, and technology innovators demonstrate a commitment to reducing the impact of counterfeit products on consumers and society.
