by Brittany Willes, editor, PostPress

Growing at a predicted rate of 3 percent per year, according to the 2016 Brand Protection and Product Traceability Market Research report conducted by PMMI, counterfeiting has become a worldwide epidemic. Global ink manufacturer Sun Chemical, Parsippany, New Jersey, recently released its “Anti-counterfeiting Technologies for Packaging” white paper, explaining how “Counterfeiting threatens public health through the production of inferior medicines, foods and beverages; causes taxes to increase by sidestepping official channels; increases public spending by boosting law enforcement to counter the illicit trade; and raises the price of legitimate products as companies seek to recoup their losses.”

Because of widespread counterfeiting, the anti-counterfeiting market is predicted to outpace growth of the food, beverage and pharmaceutical industries combined as companies search for ways to protect their brands and their customers from inferior products.

Hologram Security

One method for combating counterfeiting is through incorporation of hologram technology. Introduced in the late 1970s, the first commercial holograms were developed to create 3D images. “Early entrepreneurs were quick to realize that hologram technology could be a potent weapon to combat the menace of counterfeiting,” stated Manoj Kochar, chairman of the International Hologram Manufacturers Association (IHMA). Since then, holograms have undergone tremendous change. According to Kochar, what started as a classical 2D/3D technology, requiring a good deal of skill and sophistication to create and manage, since has evolved into a highly specialized – yet extremely flexible – device that can incorporate many different feature combinations and be used in different formats.

As far as anti-counterfeiting technology, the hologram lends itself to integration with various substrates and print and conversion technologies, which leads to new products and applications. Currently, a new generation of optical structures is in development. The structures will contain distinct visual effects, making them easy to identify and even more difficult to simulate.

“There are quite a few optically variable devices (OVD) currently on the market,” said Kochar, “but the hologram is probably the most widely used and recognized. It also happens to be the only optically variable feature that is integrated with a database of security images.”

Kochar went on to explain that the IHMA, which works closely with the Counterfeiting Intelligence Bureau, has established a Hologram Image Register, a centrally held database that provides faster online registration and copyright checking of hologram designs. Operated under the strictest confidence and security, manufacturers and producers can register their holograms, enabling them to check that production designs do not inadvertently copy existing ones and infringe copyright.

When it comes to packaging, the brightness and dynamic appearance of the hologram makes it eye-catching. It’s no secret or surprise that holograms are useful in grabbing the attention of customers browsing shelves in a store or supermarket. “This is the one single property that all brand owners look for in their packaging – brand appeal,” said Kochar. Holograms are able to impart a premium look and feel, which is why more and more companies are turning to holographic films and foils when designing packaging.

Incorporating Holograms

Due to their ability to increase both the security and visual appeal of packaging, many might assume that applying holograms would be difficult and time-consuming; however, this usually is not the case. In fact, most holography and other forms of product security have been designed specifically to correspond with existing manufacturing processes.

According to David Hutchison, CEO of Lenexa, Kansas-based BrightMARKS, “In terms of preparation of the press sheet to apply a hologram, it’s no different than any other hot foil stamping project. In terms of selecting the security level desired, the client should review the various levels of holographic security devices and choose one they believe to be the most appropriate for their needs.” Since the early use of commercially applied holograms, many forms of OVDs have been developed, allowing brand owners a variety of security solutions from which to choose.

To minimize the potential for hologram duplication, Hutchison recommends taking the following precautions:

1. Choose an OVD (hologram) that is unique.
2. Apply the hologram with a unique stamping die that has some level of complexity to it: an uncommon shape and/or a micro-texture element.
3. Plan to change either or both items 1 and 2, on some scheduled basis.
4. Communicate to the viewer or authenticating parties whenever changes are made and the effective date.

“Holography offers multiple levels of verification possibilities comprising overt, covert and forensic features, which makes it the preferred technology for most authentication solution seekers,” stated Kochar. “Having said that, it is pertinent to note that each technology has its own USP, and an effective security solution invariably employs several technologies to provide a truly effective solution.”

Additional Security Solutions

As Kochar noted, no single approach will be appropriate for every situation. In addition to hologram technology, experts recommend products and packages incorporate second-level security features. This creates a more layered approach, which has been proven to be most effective when applying anti-counterfeiting technology and protecting consumers – and brand owners – from inferior products.

Incorporating second-level security features involves adding covert or hidden features. “Second- and third-level solutions are very difficult to detect,” explained Jeff Salisbury, CEO of Label Impressions, Inc., headquartered in Orange, California. Like many companies, Label Impressions recommends clients utilize overt and covert security features. “The overt feature effectively throws the counterfeiter or diverter off the trail,” Salisbury stated. “They copy the hologram but miss the other security features ‘hidden’ within the label or package.” These covert, or “hidden,” solutions are imbedded into artwork in ways that counterfeiters, armed with anti-counterfeiting detection devices, still are unable to detect. “Features such as micro text, latent images and hidden data points buried as an additional “plate” are all highly effective solutions against counterfeiting,” he said.

When it comes to creating a layered solution, Sun Chemical identified three basic categories: on-package-based solutions, serialization (track and trace) and direct product testing. Of the three, on-package solutions are recommended as being the most prevalent. According to its anti-counterfeiting report, “The most cost-effective and effective security solution is an on-package approach. There are many benefits in using an on-package security approach, including ease of implementation, the ability to be integrated into existing processes, a rapid yes/no determination for in-field users or customs officials, and its low cost.”

For on-package security, one of the most recommended second-level covert solutions involves the use of phosphors as taggants. “Some refer to the use of taggants as third-level security, but due to its relatively low cost, I consider it a third-level option at a second-level price,” stated Salisbury. “These additives can be mixed into any ink or coating and are invisible to the naked eye. They only show up, or “activate,” when exposed to a very specific spectrum of light. Better yet, the taggant type, color and location can be changed with each print run.” This makes taggants especially effective in anti-diversion programs where a brand is looking for the specific source of the diversion. A different colored taggant can be assigned to each distributor and easily traced back from retail to the diverter.

“We had a personal care brand with a highly effective, high-cost product,” stated Salisbury. “The customer wanted a very simple, basic one-color print on a white label; however, the product was extremely prone to counterfeiting. There was literally no way for a consumer to tell the difference between the real product and a counterfeit until the product had been used for several weeks.” In addition to counterfeiting, the brand also had a significant diversion problem. Naturally, the customer wanted to determine the source of the diversion. Label Impressions introduced a taggant to the adhesive, binding the lamination to the base material and rendering it invisible to the naked eye. The client could trace the diversion back to a specific diverter and penalize the distributor financially – quickly putting a stop to the diverting. “By adding the taggant, counterfeiters do not know what to look for and believe they are providing a similar product,” Salisbury affirmed.

Sun Chemical likewise recommends taggants for high-level security and protection. As the report states, “Through the incorporation of these forensic markers, suspicious packaging can receive laboratory analysis, which not only plays a very important role in identifying a fake but can also serve as evidence in courtroom situations.” One of Sun Chemical’s own taggant solutions, Hidden Indicia™, uses proprietary software to encode covert images into original art. These images are revealed either optically by using a credit card-sized plastic lens or digitally using a smartphone or scanner equipped with decoding software.

Conclusion

Diversion and counterfeiting are more prevalent than ever in the expanding age of e-commerce. As a result, companies are becoming more and more proactive in utilizing anti-counterfeiting technology. Hologram technology has come to represent a reliable first line of defense that offers the added benefit of increasing shelf appeal. When paired with second-level security solutions, business owners and customers alike are safeguarded against inferior products.

As Salisbury noted, “Clients are often surprised to find these solutions are easy and cost-effective and typically allow for added marketing components. Truly, they are worth every penny, and their value often extends beyond security.”