Data for difficult days: insights from our users
What we are seeing: China returns
Product authentication opens a rare window for observing consumer consumption and sell-out behaviour, along with the impact of counterfeiting and distribution to parallel markets. This is particularly useful in a period when sales trends are showing the negative effects of bottlenecks in production and distribution for fashion and luxury products that began with the quarantine in China and have now been extended to the rest of the world, specifically:
1) 76% of all authentications are performed on purchases from online channels: a significant increase compared to the data of three months ago.
2) Authentications in China, which fell quickly from January to reach an all-time low at 18% of average traffic, are now showing clear signs of recovery. By the week of 16-22 March, activity in China had rebounded to 68% of the volume that historical trends would predict for this period, and that growth is continuing (see below chart).
3) Certilogo brand customers and prospects in China show a strong will to accelerate industrial production, to recover the losses of the last three months.
What it means
1) We can expect online sales to continue to increase in importance even after this emergency ends. Since brands expanding their e-commerce operations need both a broad and deep vision of their customer base, the opportunity to identify and make contact with consumers who purchase in uncontrolled channels is a crucial issue.
2) With Far East vendors hurrying to bring production back to speed as quickly as possible, we anticipate that overproduction, grey market transactions and counterfeiting will rise dangerously both in 2020 and 2021.
3) The increase in online distribution and the scarcity of original products will increase involuntary purchases of counterfeit products by unaware consumers, especially in the markets that recover first (i.e., in Asia).
What we recommend
1) Make maximum use of the tools at your disposal to prevent an expansion of grey market and counterfeit products from aggravating the negative impact on turnover. If you don’t know how Certilogo can help, please reach out to us for more information.
2) Take advantage of this moment of uncertainty to establish contact with consumers: today, more than ever, they need your reassurance that the products they buy are authentic and that Brands are there for them.
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