Despite the business advantages of the internet, new research has revealed that brand owners are finding it increasingly difficult to police and protect their brands online.
Eighty one per cent of brand owners feel that intellectual property law has failed to respond to the challenges of the internet. 64 per cent feel that internet has made it harder for them to police and protect the reputation of their brands.
The findings are pertinent for the cycle trade, with IBDs and brand owners concerned about devaluing names and product through the internet.
"While the internet presents a vital means of distribution for companies, the free-flow of goods and information creates a dimension of risk that brands have never had to deal with until now," said Marks & Clerk partner Pam Withers. "Never before has it been simpler to steal ideas and editorial and avoid being caught; never before have the negative effects of word-of-mouth discussion been felt so quickly; never before has it been so easy to distribute counterfeits or attack companies from behind a veil of anonymity.
"This is a serious challenge and ultimately one that may well be borne by the consumer if brands are continually abused online.”
Google's European dominance was seen as a problem to six in ten respondents, saying that the site has benefited from search-related online advertising (AdWords sponsored keyword service) which has allowed advertisers to bid on keywords that relate to a competitors name.
eBay also came in for particular criticism for being at the centre of counterfeiting cases, but the survey also revealed that brand owners were also concerned about the perils of social media. Should social sites like Facebook, Twitter and LinkedIn follow in the footsteps of Google by providing search-related advertising then competitors will in theory have even more opportunity to bid on competitor brand names.
Withers added: “With the nation now held firmly within the grip of social media, our research shows clear concern that the digital threat to brand owners is most likely to increase, rather than recede, in the future. Search-advertising revenue is hardly new, yet the prevalence of online search is certainly a growing facet of business marketing and likely only to extend over the coming years as social media platforms begin to monetise their impressive reach.
"With Facebook reportedly having the world’s ‘third largest population’ – more than 400 million users, compared to a population of just over 300 million in the US – it is little wonder we are seeing increasing protectionism and nervousness from brand owners.”
The survey was conducted by international intellectual property group Marks and Clerks, based on views from 266 UK business execs responsible for brand ownership, marketing and control.