how to protect your brand online: the top 10 best ... · how to protect your brand online: the top...

How to Protect Your Brand Online: The Top 10 Best Practices for Marketers

White PaperJuly 2009

Executive Summary

There’s no question that the Internet is an ideal venue for marketing. But along with the advantages come risks, due in part to the core qualities of the medium: openness, anonymity, and instant global reach.

Because the online world has seen so little formal policing, it’s ideal for the “hijacking” of brands online. Scammers have realized that the value and power of your brand is very good for business—their business—and their gains come at the expense of marketers.

The number of venues available for taking unfair advantage of legitimate brands keeps growing: search engines, social networking, eCommerce, auction and tradeboard sites, email, blogs and microblogs. Whether the illicit activities are aimed at diverting traffic to competing businesses, exploiting your brand to generate advertising revenues, or stealing directly from your bottom line with potentially counterfeit and grey market sales, they all have the effect of eroding brand value and devaluing your marketing investments and revenue.

Unlike offline media, marketers have little to no control over brand-related content online. As a result, the online world requires closer monitoring. And because online brand abuse causes substantial brand erosion—lost revenue, diminished customer trust, and tarnished reputation—marketers may have the greatest stake of anyone when it comes to protecting brands online. As the de facto guardians of the brand, marketers can and should take the lead in protecting what they themselves have built—rather than relying solely on other areas of the organization. Best practices, targeted technologies and collaboration with other functional units can facilitate a holistic strategy for protecting hard-earned brand equity and revenues.

White Paper: How To Protect Your Brand Online

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Contents

The Brand Builder’s World, Then and Now .............................. 3

Online Brand Abuse: Should Marketers Worry? ..................... 4

Like it or not, marketers have the most to lose from online brand abuse ............................................................................................. 4

Prevalent Abuses: A Dismayingly Long List .............................. 5

Marketers: Their Own Best Hope ............................................... 9

What NOT To Do .......................................................................... 9

The Top 10 Best Practices in Online Brand Protection ........... 10

When to Get Involved? NOW ...................................................... 11


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The Brand Builder’s World, Then and Now

Not so long ago, brand-building was easier to manage than in today’s wide-open environment. Go back three, even just two decades and count the communications vehicles: marketers could choose from newspapers, magazines, television and radio, enjoying substantial control over all of them. With a media plan in place, and absent any massive public relations disasters, marketers virtually dictated what would be seen, heard and read about their brands.

Things were similarly simplified at the retail level, where prospect and customer interactions were limited to brick and mortar stores, catalogs, and toll-free telephone lines. Signage, scripts, point-of-sale promotions and training kept the brand message on target.

Things have changed—thanks to the Internet. In what has proven to be a marketer’s dream, communication and distribution channels have grown (and continue to expand) exponentially: from search engines to eCommerce, auction sites and trade boards, from blogs to social networking sites and—yes, even microblogs.

The marketers of 1980 would have jumped at the opportunity to leverage such flexible, cost-effective, and easily segmented media platforms and distribution channels. But they may also have landed in many of the same pitfalls we face today—the Internet’s openness, anonymity, global reach and distinct lack of formal policing have paved the way for brand abuse, traffic diversion, online fraud and unauthorized distribution channels.

Joining the attack is a growing army of scammers aiming to “hijack” brands online. Fraudsters know the value of a brand as well as marketers do, and they’re working quickly to profit from the brand value and customer loyalty legitimate marketers have built. Their activities severely undermine the marketing investments made by legitimate brand owners.

Which brings us back to the brand builders—marketers—and their own stake in the struggle between the legitimate use of brands to drive revenues and profits, and illicit or fraudulent brand abuse designed to take some of those profits away from its rightful owners. Who, more than marketers, would value protection of the asset they’ve invented, developed and nurtured?

Here’s who: the CEO and the board, who know as well as marketers do that brands drive business. That’s why today’s marketers, more than ever, are expected to measurably deliver more revenue, customers, awareness, loyalty, and everything else a brand can create—all with maximum return on each marketing investment. The current economic downturn merely turns up the heat.

A recent study by Verse Group and Jupiter Research (now Forrester Research) confirms these priorities. In a February, 2009 survey of Chief Marketing Officers, two themes emerged: the need for more marketing accountability, and the

According to DIRECT magazine, one in seven searches on branded items lead users somewhere other than the brand’s website. Are YOU losing out on this much traffic—or more?


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mandate to more effectively manage brands across multiple platforms in new and traditional media. The emphasis is on delivering measurable, positive return on marketing investments, translating brand experiences across differing touchpoints, and—naturally—achieving more, with smaller budgets.

As a result, marketers are highly incented to protect the brands they’ve built and to preserve the marketing ROI on which they’re increasingly being measured.

Online Brand Abuse: Should Marketers Worry?

Today, some Internet users find your brand online through direct navigation, but most get to you through a hyperlink—from organic or paid search results, other sites, email messages, or social media. While this array of media presents diverse opportunities for legitimate marketers, it offers the same capabilities to less savory—but still often talented—scammers.

These brandjackers invoke all the same creativity, technology skills, and sophisticated marketing techniques available to legitimate marketers to drive traffic and conversions—and in far too many cases, their savvy may outdo that of the “good guys.”

Like it or not, marketers have the most to lose from online brand abuse

Revenues and margins both suffer as customers do business with unauthorized channels. With marketing organizations being held more accountable for both of these measures, marketers can’t afford to ignore this impact.

Wasted marketing budgets are another worry. Online advertising spend, in particular, is significantly diluted when legitimate ads must compete with illicit ones; further dilution occurs simply because a company’s brand is appearing in so many unexpected, unplanned, and unwanted venues. The unavoidable result of this competition is fewer legitimate impressions, and fewer clicks.

Reduced marketing ROI. But it’s not just marketing budgets that lose their punch. Companies invest millions of dollars to create, promote and maintain their brands and messages, typically across numerous platforms. As online traffic is diverted to unauthorized, competitive, or probable fraudulent venues, the return on every one of these marketing investments shrinks. This negative impact isn’t limited to the online facets of a brand: overall brand value is diminished, diluting offline marketing activities as well.

Meanwhile, as scammers exploit a brand’s good name and reputation for their own profits, they significantly erode customer trust. Customers lured into doing business with scammers can and do associate any negative results—inferior product, bad service, or even criminal identity theft—with your brand. Consciously or sub-consciously, your brand becomes bad news—and that means less business moving forward.

Online display ads topped $7.6 billion in 2009, while search ad spending surpassed $10.5 billion. How much of this was wasted or diluted because of scammers? How much do YOU have at risk?


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We can’t blame customers—they may not even know they’re dealing with an imposter—but we can (and should) worry about these deceptions that could lead to customer harm. Brand owners can face higher customer service costs and more customer churn because of customer dissatisfaction caused by online brand abuse.

So… yes, marketers have plenty to worry about—and the risks go to the heart of the marketing budget and beyond. Online brand abuse causes deliberate, substantial brand erosion—lost revenue, diminished customer trust, and tarnished reputation—with the very real effect of shrinking the return on marketing investments.

Prevalent Abuses: A Dismayingly Long List

To protect—and even guide—the investments you make building your brand, it’s useful to understand the online abuses that can threaten it. A list of the most popular abuses follows, and it’s worthwhile to study it in full. Attacks on brands commonly entail blended abuse—multiple, integrated tactics—which, left unchecked, can overwhelm even your best brand-building efforts.

Traffic diversion schemes, elements of many blended abuse strategies, unethically divert traffic to competing or illegitimate sites. The tactics used may include search engine marketing abuse, spam, cybersquatting, SEO manipulation and other techniques, all described below. The goal of these schemes is always the same: to directly steal traffic meant for legitimate sites.

Search engine marketing abuse occurs when unauthorized parties use a brand as a keyword in search marketing, triggering ads that divert traffic to sites promoting unrelated, counterfeit, or competitive brands. Because the major search engines have varying policies on this practice, the onus is on brand owners to police where and how their brands are being used by others.

This practice represents significant lost revenue opportunities for the brand owner. At a minimum, search engine marketing abuse levels a direct hit on legitimate marketing budgets by diluting a brand owner’s search marketing spend.

Pay-per-click abuse occurs when a scammer sets up a website to host paid search ads for the purpose of generating revenue when the ads are clicked. The scammer often leverages a well-known brand name in the domain name and has loosely-related ads served to its site. The practice is lucrative: pay-per-click sites targeting the world’s top 30 brands were up 24 percent in 2008.

Search engine marketing abuse lures 14 of every 100 users searching on your brand to a competitor’s or scammer’s site. How many customers can you regain by taking action?

Figure 1. In this example of search engine marketing abuse, a luxury goods e-tailer has used another brand’s trademarked name in its ad copy—and has inappropriately purchased the corresponding keyword. That search ad leads to a site which is likely selling counterfeit goods.


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Given the way online advertising is bought and sold, ads from legitimate brand marketers’ are sometimes displayed on these sites, and Internet users may ultimately land on a brand owner’s site. But this means the brand owner has paid for unneeded clicks, as users likely would have found the legitimate site without being diverted to extraneous pay-per-click sites. In other words, legitimate brand marketers are subsidizing traffic diversion—our investments in our own brands are being used to finance attacks against us.

SEO manipulation. When brands, slogans and trademarks are placed in a website—as visible text, hidden text, or within HTML meta tags—they affect search engine rankings. When someone other than the brand owner uses this type of search engine optimization (SEO), they unfairly affect rankings.

This unethical practice, is one of a number of Black Hat SEO practices, that cause the abusing sites’ rankings to

be moved up in search engine results. An unaffiliated eCommerce site might be listed before a legitimate company site, resulting in higher click-through rates for the unaffiliated site.

This “organic” form of traffic diversion undermines marketing investments in two ways—siphoning traffic away from brand owners despite their own outlays for legitimate SEO efforts, and forcing legitimate, paid search advertisements to compete with illicit, organic search results.

Cybersquatting and typosquatting is the tool of choice for online scammers who use the domain name system to abuse trademarks. Brand names—spelled correctly or, in a practice known as typosquatting, spelled incorrectly—are used within a domain name, enabling the squatter to divert traffic meant for a legitimate site to an illicit site which may sell counterfeit goods, utilize pay-per-click abuse, host adult content, or conduct other illicit activity. In some cases, cybersquatters may also hope to sell a domain to the legitimate brand owner at a profit.

In a more recent trend, scammers employ similar techniques on social networking sites, impersonating brand owners by incorporating the brand in their own user names, or by creating profiles which “look and feel” like the legitimate brand.

Figure 2. This example of pay-per-click abuse urges diverted traffic to buy from competitors and counterfeiters—while earning advertising revenue for the domain owner.

Figure 3. In this blended abuse example, a trusted brand name is used within the URL—cybersquatting—to divert traffic to a site combining offensive content with unrelated eCommerce sales.


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Regardless of the ultimate goal, these squatted domain names, with their dishonestly obtained brand power, are highly effective at diverting traffic from its intended destination. According to the MarkMonitor Brandjacking Index®, which tracks online brand abuse, cybersquatting comprises the majority of online brand abuse—up a full 18 percent from the previous year.

Counterfeiting and piracy. The sale of fake physical goods—counterfeiting—and of fake digital goods such as music, movies, software and gaming software—piracy—is rampant online, occurring on B2B exchanges, auction sites, eCommerce sites, in spam and through peer-to-peer (P2P) networks. Online venues represent the fastest-growing segment of the counterfeiting trade, with estimated sales of $133 billion in 2009.

While generating revenue for the perpetrators, these exploits also represent an attack on brands, resulting in lost revenue, erosion of brand equity, and, in many industries, potential consumer health and safety risks —for example, the sale of potentially counterfeit drugs or automotive parts. With counterfeit goods sales up by 45% in 2008 alone, with the Internet facilitating 80% of the increase in sales, the threat to marketing budgets is huge—and growing.

Grey market selling—the sale of authentic goods through unauthorized channels—is also growing rapidly online, representing a significant threat to brand equity and revenues. A full 40 percent of surveyed Global 2000 marketing executives admit some price erosion due to grey market or counterfeit sales.

Grey market goods are obtained through a variety of means: theft and discount fraud are common, as is refurbishing damaged goods. The goods are then sold on B2B exchanges, auction sites, and eCommerce venues. Parallel trade, in which goods priced for a specific geographic market are diverted and sold at a premium in other markets, is another widely used strategy.

Brand defamation. One of the Internet’s most desirable attributes is the platform it provides for people to speak their minds—and that includes opinions about your brand, good and bad. But when your brand is slandered for purposes of driving traffic to a competing brand (legitimate or fake), it’s online brand abuse.

These slander-for-profit exploits can be found in many places online: in social networking sites as well as in blogs and on message boards. The resulting damage

Figure 4. This purportedly Canadian online pharmacy—actually hosted in the Russian Federation and potentially selling counterfeit and grey market goods—erodes brand name medicine prices, consumer confidence, and brand image.


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to a brand’s image and reputation—not to mention associated revenue hits—can be devastating. Interestingly, this is one of the easiest ways to attack a brand online—no technology skills or special knowledge are required.

In false association, scammers imply a relationship with a company or brand where none exists. A bogus site may closely mimic the appearance of the true brand, falsely claim the legitimate company as a satisfied customer, pretend to be an authorized reseller, or claim to be a member in a franchise network when it is not.

False association is popular with scammers—according to the Brandjacking Index, the practice increased 20 percent in 2008 over the previous year—because it is highly effective at building credibility and trust as well as in driving significant traffic to illicit sites. Since it can result in legal liability for the brand owner—or, as in the case of fake pharmacies selling drugs that may be counterfeit, the possibility of customer harm—marketers find false association particularly onerous. The practice can also significantly tarnish a brand owner’s reputation when Internet users perceive the legitimate brand’s endorsement of an unsavory business or content.

Spammers send unsolicited emails—frequently leveraging well-known brands—in order to divert traffic to illicit sites of every type. In 2008, spammers sent 53.8 trillion email messages—70 percent of all email—mostly using bulk email tools.

To encourage recipients to click through, spammers design their email to imply that their product or service is endorsed or sanctioned by the legitimate brand. Users who do click through, encounter everything from pay-per-click abuse to sales of possibly counterfeit or pirated goods.

Spam may be viewed as a nuisance, but its real danger is in driving recipients to nearly every other type of abuse discussed here. Spam also directly impacts marketing budgets by reducing the effectiveness of legitimate email campaigns.

Phishing and malware. Phishers use email and newer channels such as social media, preying on the trust people have in a brand in order to obtain personal credentials—including social security and credit card numbers—through a bogus site that appears legitimate.

In a variation, an illicit site or email attachment installs malware, viruses, keyloggers or other software that automatically steals usernames, passwords, and additional information without a user’s knowledge.

These schemes are most frequently aimed at financial service providers, but phishers are expanding their reach by targeting gaming companies, career sites, social media publishers, retail firms and others. In fact, 444 organizations were phished for the first time in 2008. The potential damage to legitimate brand owners ranges from lost customer trust to millions of dollars.

Figure 5. This phish site lures Internet users with email and a URL containing a registered trademark of the brand owner.


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Marketers: Their Own Best Hope

Knowing how directly online brand abuse affects them is a key first step for marketers. Fortunately, the problems presented by online brand abuse are solvable, especially if brand owners leverage the technologies available to them. After all, it’s only reasonable that technology, having enabled the problem, can also be used to fight it.

Because abuse impacts a wide range of business functions, the work of protecting against it will involve a range of functional units within the enterprise. Marketers will want to take a leadership role—both for the good of the enterprise and to protect marketing investments and brand reputation. The current economic downturn provides further incentives for marketing’s involvement—notably, pressure on marketing budgets. No enterprise can compete without efficiency in its marketing spend; when that spend must be limited, it’s critical to eliminate as much waste as possible.

If marketers choose their strategies accordingly and work collaboratively with other functional units to implement holistic protection strategies, they may succeed in protecting hard-earned equity and revenues.

What NOT To Do

As marketers engage with the problem—and, ideally, join with other functional units to do so—there are strategies best avoided. They include:

Doing nothing. There is little likelihood that online brand abuse will go away of its own accord. As long as there is money to be made, scammers and criminals will leverage your brand to do it. Because you’ll have to deal with the problem, it makes sense to focus on prevention, which is frequently much easier than repairing damage already done.

Manual approach. Trying to keep tabs on uses of your brand across the vastness that is the Internet simply isn’t feasible—there are too many venues, channels, and messages moving at high speed. Shifting technological complexities necessitate a technologically-aided monitoring strategy. One other advantage of automated monitoring: you’ll demonstrate to potential fraudsters that you actively protect your brand, which will likely discourage them from attacking, much as a prominently displayed security system encourages burglars to look elsewhere.

Treat all abuses equally. Given any two specific brand abuses, one will impact your brand and revenue more heavily, more quickly, or both—and that abuse must be addressed first. Marketers should work with other functional units to set priorities for monitoring, response and enforcement.

Respond to every abuse. Brand protection budgets will have their limits, too, and not every abuse will have an appreciable impact on revenue, reputation, or marketing budgets—so identify the most egregious abuses, set priorities and focus efforts where they’ll have the most impact.

No enterprise can compete without efficiency in its marketing spend; when that spend must be limited, it’s critical to eliminate as much waste as possible.


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The Top 10 Best Practices in Online Brand Protection

Despite the dangers, there are considerable grounds for optimism. Many larger enterprises have deployed holistic, multi-faceted brand protection programs. The most successful among these have achieved substantial declines in fraudulent activity; and these declines can be related directly to improved returns on marketing investments. The strategies employed by these companies include the following recommended best practices.

See the entire problem. Preventing and responding to attacks can’t begin until you’ve gained a clear understanding of how and where your brand may be attacked online. Cataloging the risks is a good start, but you won’t be able to effectively set priorities until you gauge each threat’s potential impact on your business. In particular, work to understand the effect threats have on your online advertising spend and across-the-board marketing efforts.

Speak up for your brand. Don’t depend on Legal and other business functions to enforce against online brand violations. Take the time to watch for—even anticipate—attacks against your brand, and encourage pro-active defense and decisive enforcement action when it’s needed.

Think big-picture, wide-picture. Brand protection works best when multiple detection, prevention, and response mechanisms are designed to complement one another. The desired, holistic brand protection approach means assessing every channel, every tactic abusers may leverage, including those in offline settings. You’ll need to work across organizational boundaries to achieve the synergy needed to effectively safeguard your brand.

Take the offensive. It’s possible to pre-empt fraudsters on a number of fronts—and doing so may lead potential infringers to exploit other, more vulnerable brands, rather than your own. Be proactive in every aspect of brand protection.

“Own” your domain portfolio. Too many enterprises spread domain portfolio management across multiple organizations or geographies, inviting domainers and other scam artists to jump on the inevitable lapses. Do whatever you must to ensure your organization has a single, global view of your domains, enabling it to ensure timely renewals and quickly assess both opportunities and threats. And keep looking forward: when you’re developing a new brand, anonymously register new domains well ahead of launch time or even consider your own top-level domain, or ‘dot brand’.

Take control of online channels. It’s critical to know precisely where your goods are being sold—and by whom. Be aggressive about spelling out and enforcing channel compliance; this is another area where proactive effort discourages undesirable business practices by affiliates or partners.

Work closely with Legal. They’ll appreciate your efforts to prioritize abuses; and they can help you prioritize by understanding enforcement ramifications.

Brand protection works best when detection, prevention, and response mechanisms complement one another.


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Collaborate continuously to target the worst, most damaging abuses.

Keep it real for your customers. Clamp down on fraudulent (and other negative) online experiences associated with your brand—and do so publicly. Showing your customers that you care about their experience gives them the confidence to continue working with you online. Think about it: consumers are less likely to abandon a cart when they know the brand owner works hard to prevent fraud.

Listen. Some of the most valuable intelligence you can acquire will come from customers, employees, and other stakeholders outside the inner circle of brand holders. Reach out to these communities to encourage alerts, ideas, and suggestions.

Know when to tread softly. Not every brand abuse calls for immediate legal response; in some cases, a simple request to the offender, or a strongly–worded warning letter, will evoke the best outcome (and, in many cases, at less cost).

When to Get Involved? NOW

As marketers and technologists, we operate in a highly changeable world. We also know that fraudsters rely on change to identify and exploit opportunities quickly, as they arise.

The sooner your organization has a cross-functional brand protection effort—championed and actively supported by the marketers responsible for a brand’s health and well-being—the better return you’ll earn on every marketing investment. The time for marketers to stand up to online brand abuse is now.

Holistic Brand Protection at Epson

Challenges

Faced with ever-increasing counterfeit and grey market sales online, digital imaging technology provider Epson created a cross-functional team to build and launch a brand protection strategy.

Solutions

By deploying an integrated, automated brand protection solution on a global level, Epson has complete visibility of its global domain portfolio and brand usage online. The company is now able to safeguard its brand equity against a wide range of online abuses.

Results

These measures have resulted in a three-fold reduction in counterfeit activity on consumer auction and B2B tradeboards, with similar reductions in active cybersquatting incidents. With brand attacks reduced, returns on marketing investments are likely to grow.


More than half the Fortune 100 trust MarkMonitor to protect their brands online. See what we can do for you.

MarkMonitor Inc.U.S. (800) 745.9229Europe +44 (0) 207.840.1300www.markmonitor.com

© 2010 MarkMonitor Inc. All rights reserved. MarkMonitor is a registered trademark of MarkMonitor Inc. Source Code: WPTOP10MKT100222

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About MarkMonitor

MarkMonitor, the global leader in enterprise brand protection, offers comprehensive solutions and services that safeguard brands, reputation and revenue from online risks. With end-to-end solutions that address the growing threats of online fraud, brand abuse and unauthorized channels, MarkMonitor enables a secure Internet for businesses and their customers. The company’s exclusive access to data combined with its patented real-time prevention, detection and response capabilities provide wide-ranging protection to the ever-changing online risks faced by brands today.

To learn more about the MarkMonitor Brand Protection Platform, Solutions and Services, please visit www.markmonitor.com.

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