Counterfeiting is big business. Recent research predicts that the value of the global counterfeit goods trade will reach $1.79 trillion by 2030, with one in every $20 spent on fake goods. This represents a growth rate 3.6 times higher than that of the global economy, over the same period.
The impact of counterfeiting is not limited to lost revenue: it also has a damaging effect on the labour market, where lost profits translate into lower wages and lost jobs, as well as brand reputation and – not least – consumer safety. In short, it’s in everyone’s interest to stamp it out.
Combating counterfeits through technology
Manufacturers use multiple methods to ensure authenticity and prevent fake goods from reaching the consumer, but these tend to be low-cost and relatively easy to replicate – such as holograms or QR codes – or more secure, but with a higher unit cost, making them unsuitable for deployment at scale.
Near-Field Communication (NFC), for example – a subset of RFID technology – offers greater security while being difficult to duplicate. By storing encrypted data that demonstrates authenticity at item level, NFC tags provide an unalterable record of origin, journey and ownership at any point in the supply chain, from production to the point of sale. This level of traceability helps retailers to protect their reputation and prevent counterfeit goods from entering the market.
The tags also contribute to Digital Product Passport solutions, storing information around circularity and value retention, to allow products to be successfully re-used, remanufactured, or recycled.
Furthermore, with a single tap of a smartphone, NFC can provide consumers with digital reassurance – particularly important for industries where product integrity is paramount, such as pharmaceuticals, cosmetics or even luxury goods.
However, these NFC tags rely on semiconductors – typically silicon chips – for their intelligence. These chips often have long development times, a relatively high production cost, and a considerable carbon footprint. Given the high volumes and razor-thin margins that retailers work to, it simply isn’t cost effective to have a silicon chip embedded into every single item – and it wouldn’t make sense for their carbon footprint, either.
Recent developments in semiconductor technology are changing this paradigm, with new materials and manufacturing methods that are set to redefine the shape of authentication and tamper detection for mass-market goods.
A flexible NFC solution
Advanced semiconductor manufacturing is unlocking the potential for low-cost NFC to be implemented – at scale.
New materials that don’t rely on silicon, and low-temperature processes – using significantly less energy and water, and fewer harmful chemicals – drive down cost and vastly reduce carbon impact, making low-cost, sustainable, item-level intelligence a reality.
These advanced chips are ultra-thin and also physically flexible, making it possible to deploy them almost anywhere – from clothing and textiles to bottles or coffee cups – with few constraints on form-factor.
Embedded directly into packaging, they’re imperceptible to the touch. They don’t encroach on product branding and can’t be covered or replaced – and they’re robust enough to withstand continuous movement and deformation. And since their carbon impact is lower than standard NFC tags, they can help companies meet sustainability targets, too.
These new-generation chips also provide an opportunity to drive loyalty and create seamless customer experiences. With just one tap of a smartphone, customers can get personalised content tailored to factors such as their location, time of year or previous interactions. This, in turn, provides brands with first-party data that they can use to build and strengthen customer relationships further.
Creating competitive advantage
In short, advanced material semiconductors can unlock the potential of low-cost NFC at scale, radically reducing the prevalence of counterfeit goods while increasing consumer loyalty and trust.
By reducing losses from counterfeiting, as well as improving operational efficiency, next-generation NFC solutions can drive long-term brand value while driving down carbon impact, ultimately making retailers more attractive – and competitive – in an increasingly crowded marketplace.
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