Ecommerce helps business thrive in new markets around the world, but it also opens the door to organized crime online. Counterfeiters turn the positives of modern commerce on their head, pushing fake goods to consumers with listings and ads, then melting away into the air under scrutiny. Grey market goods are sold outside authorized distribution channels of the brands. When brand managers can’t physically see or feel the counterfeit or unauthorized goods disrupting their online revenue, how can they get a hold of the problem?
Ultimately, infringers combine online tactics (fake online shops, social media profiles and ads, and grey market listings), with offline logistics (stealing from manufacturers, infiltrating supply lines, shipping goods across borders). Effective anti-counterfeiting and grey market therefore require offline counterparts to your online efforts, to finally protect your brand and stop the infringers. Here, we’ll explore the importance of offline investigations, and how to implement a strategy that takes the issue’s full scope into account.
How online counterfeiters exploit offline networks
Damaging operations often form vast, highly organized networks. These networks operate with one goal and several means to achieve it: generating revenue by selling fake goods. To achieve these goals, they’ll stop at nothing, executing targeted attacks on both physical and digital fronts. Tactics of counterfeiters typically include factory break-ins, counterfeit production lines, and large-scale smuggling campaigns. Once they secure their materials, counterfeiters use them to fuel fake webshop operations. Their social media scam campaigns also sell stolen goods or knockoffs.
This dual approach combines offline theft, grey markets, and counterfeiting with online distribution. Integrating their tactics allows infringers to infiltrate legitimate markets while evading detection. Each link of complexity in their supply and distribution chain makes them harder to detect and harder to bring to justice. Infringers span continents to exploit weaknesses in global trade.
One striking example involves counterfeiters directly targeting legitimate factories where thieves broke into a Chanel factory in Milan. They stole 30,000 serial number cards during the middle of the night, which Chanel had earmarked to authenticate its products. The cards, along with holograms, verify the authenticity of luxury items. Counterfeiters later used the stolen serial numbers to produce fake goods which could pass as genuine, undermining brand integrity. The theft highlighted how counterfeiters infiltrate legitimate production systems, flooding both physical and digital markets with convincing fakes.
Smuggling, grey markets, and the global supply chain
Beyond factory thefts, counterfeiters rely on sophisticated smuggling operations. They exploit global shipping networks to distribute fake goods. According to the OECD, containerships transport 56% of the total value of seized counterfeits, and major ports in East Asia serve as key hubs. These networks move counterfeit goods through complex logistics chains, often concealing fakes within legitimate shipments. Their evolving tactics make it difficult for anti-counterfeiting authorities to detect and intercept fakes on the open market. Clearly, robust offline investigations complement digital enforcement efforts for comprehensive anti-counterfeiting coverage.
Online Brand Protection solutions play a critical role in tackling these trends across digital landscapes. However, brands must also address the physical logistics of counterfeiting and parallel trade distribution networks. Digital monitoring tools identify suspicious online listings, and investigators then verify the origin and distribution of these goods. Crucially, Online Brand Protection helps address the influx of small packages, while supply chain data delivers the tools and insights to tackle larger shipments. By integrating online and offline strategies, brands and authorities can disrupt the entire counterfeiting chain.
How to fight back against counterfeits and grey markets
Counterfeit networks operate on a scale that many businesses find overwhelming. These operations don’t just push fake products online; they run like professional businesses, complete with customer service teams, supply chains, and even quality control measures. Their operations seem seamless, shifting between online platforms and physical distribution channels, making them difficult to track and disrupt.
Ultimately, they are sophisticated, but by no means unstoppable. With the right strategies and a dedicated team, businesses can dismantle counterfeit supply chains and reclaim lost revenue. Combining online brand protection with on-the-ground investigative services, companies eliminate uncertainty and take direct action against counterfeiters.
Revenue recovery is not just about enforcement. It’s also about ensuring that businesses regain control over their brand, their market share, and their customer trust. A strong anti-counterfeiting approach integrates both digital monitoring and physical investigations, allowing brands to track, trace, and shut down counterfeit operations at every stage of the supply chain.
Here are three key strategies to fight back against counterfeit, but also grey market / parallel trade, networks:
Online investigations
Online investigations form the backbone of modern brand protection efforts. They leverage vast amounts of open-source intelligence (OSINT) to track illicit networks. By analyzing digital footprints, investigators identify key players in illicit operations, map out online supply chains, and uncover hidden connections between online sellers and physical distribution hubs.
That being said, digital intelligence alone is not enough. Criminal networks operate across both online and offline spaces, requiring a broader approach. By integrating OSINT with intelligence on exporters, importers, and intermediaries, investigators gain a clearer picture of how counterfeit or grey market goods move from exporters to global markets. This combination of digital forensics and traditional investigative techniques ensures that enforcement actions are not only reactive. They also work proactively, disrupting bad actors at their source. Online investigations, and the results that follow, deliver valuable revenue recovery, wresting ecommerce finances from the hands of criminals back to their rightful owners.
Test purchases
A crucial tactic in anti-counterfeiting efforts, test purchases help verify the authenticity of products and expose grey market supply chains. By acquiring suspect goods from online marketplaces, social media vendors, and even physical storefronts, investigators gather direct evidence. This method provides also insight into packaging, labelling, and distribution methods.
In many cases, test purchases reveal links between online sellers and large-scale grey market operators. For instance, a test purchase from an online marketplace may lead to a brick-and-mortar distributor supplying identical products. By conducting test purchases across multiple regions, investigators can map the scope of an operation and trace goods back to their origin. This approach strengthens legal actions and enhances enforcement measures, ensuring that both digital and physical networks are dismantled.
Offline investigations in anti-counterfeiting and grey markets
While online monitoring provides critical intelligence, on-the-ground investigations offer unparalleled insights into production and distribution. Field investigators visit suspect locations, including manufacturing sites, warehouses, and physical retail outlets, to confirm illicit activity and gather actionable intelligence.
These investigations often reveal hidden supply routes, identify key players within counterfeit networks, and expose connections that digital analysis alone cannot uncover. By coordinating with law enforcement, customs agencies, and industry experts, investigators. document evidence firsthand. This supports targeted enforcement actions such as raids, seizures, and factory shutdowns. The ability to physically verify and disrupt counterfeit supply chains ensures a comprehensive anti-counterfeiting approach that extends beyond digital monitoring.
What’s next? Integrating your brand protection
Counterfeiting networks and grey market goods operations obstruct your revenue, damage brand integrity, and erode customer trust.
If you’re ready to take action, start with a free brand audit to uncover how bad actors are targeting your business online. Get in touch with Arkadiusz, our Director of Intelligence and Investigations, to see how we can work together to prioritize revenue recovery, stop counterfeiters, grey market and parallel traders, while protecting your brand—and your clients—with effective strategies.
