Beauty brands should adopt smart packaging solutions as e-commerce rises, says GlobalData.
The analytics company noted the rise in online shopping for UK health and beauty products means brands should prioritise blockchain or data tracking technology to ensure consumers are not buying counterfeits.
The online channel forecast is expected to account for more than 15% of products by 2024.
GlobalData found consumers, particularly Gen Z and millennials, are the most price, image and trend-conscious, and at the same time the most internet-savvy, with social media purchasing and influencer marketing, making it paramount for these shoppers to be protected from fake goods.
“Counterfeit products hold high risk for personal care brands, and it is imperative from both consumer safety and a branding perspective to fight against these fake products on all fronts,” said Yamina Tsalamlal, Associate Analyst at GlobalData.
“It is in a brand’s best interest to invest in smart packaging solution, especially at a time when more customers than ever are shopping via e-commerce platforms – where the shopper can’t see the salesperson or test the products in person.
“Smart packaging can give consumers that peace of mind.”
Health concerns
GlobalData estimates the counterfeit industry to be worth trillions, and these products are not just potentially costly to consumers.
Speaking to Cosmetics Business, Tosshan Ramgolam, Pre-Sales Consultant at brand protection specialist Incopro, said these products can also be detrimental to consumers’ health.
“Counterfeit cosmetics are often manufactured in unsanitary conditions where bacteria thrive.
“Seized goods have been found to contain toxic materials such as cyanide, arsenic, lead, mercury and, in some cases, even rat excrement.”
He added: “These harmful ingredients will cause skin irritation, rash or infection, and many are linked to a higher risk of cancer.”
This is another reason why Tsalamlal encourages brands to invest in smart packaging solutions.
“With so many e-commerce touchpoints, it can be difficult for a consumer to resist a great deal on their favourite brand.
“However, if they have access to blockchain technology – whether that be via an app or directly on product packaging – everybody wins: consumers get access to a safe and tested product they can trust, and brands can ensure their trademark and reputation is protected.”
