consumer engagement wine industry Archives

Today we’re talking about wine brand protection. Why it’s important for the industry and how to use your supply chain to make it as strong as it can be. Specifically, we’re focusing on counterfeits, an evergreen problem for the industry.

Talking about brand protection is a fitting conclusion to our series of articles about wine and a great way to mark the last day of the Unified Wine and Grape Symposium. Speaking of which, stop by Booth 807 to meet us and our other Antares Vision Group team members, FT System and Applied Vision. We’d love to see you before everybody heads home.

Now on to wine brand protection and the fight against counterfeits.

Why is wine brand protection important?

In the wine industry, your brand is critical to success. Whether you’re a multi-generational operation or the new kid on the block trying to make your mark, it’s one of your most valuable assets.

Your brand tells the story of your wine, from the soil and the vines to the bottle to your customers’ tables. It connects you to your partners and consumers. It sets you apart from your competition. It’s your identity out there in the world.

Alas, wine — and spirts — are under a constant barrage of brand protection threats and challenges. The circumstances range from bad actors trying to rip you off to the ebb and flow of the market and the trends that are defining it as we’ve made our way into the 2020s. Today, we’re focusing on the bad actors. Let us know if you’d like us to write more about factors or have anything to add to our discussion.

Counterfeits and fakes

Counterfeits and fakes are the undisputed champion of threats to wine brand protection. It’s an age-old problem, though industry observers rightly note that the pandemic has created more opportunities for fraud. The increase in online sales, including auctions, and less in-person due diligence because of travel restrictions are two examples.

How is wine counterfeited? Let us count the ways. There can be theft at production and storage sites. Theft and diversion also happen as wine is being delivered across the supply chain.

Counterfeiters also like to misrepresent a wine’s origin, vintage, variety, blend — really anything that distinguishes a brand and increases their chances of making a profit.

“Damaged wines” also manage to get into the marketplace. These might have been stored at the wrong temperature or have torn labels and bad corks. Adulterated or cheap wine is bottled in a prestige package.

In Part 1 of our wine traceability series, we mentioned the notorious Rudy Kurniawan. But the daily reality of counterfeit wine (and spirts) is much less dramatic. Consider these news items:

In 2011, hundreds of bottles of fake Jacob’s Creek wine were seized in the UK. More recently, a shopkeeper in England was fined more than $5,000 for having 142 bottles of fake Yellow Tail on his shelves. He said he bought the wine from a man who popped by his shop in an unmarked van; authorities say he could have profited in excess of $600 by selling the plonk. He didn’t get a receipt or an invoice, and the man in the van has not been found. Interestingly, analysis showed that the bogus Yellow Tail was less than 12 percent alcohol. Real Yellowtail is 13.5 percent. This is another example of how counterfeit wine is adulterated.

In 2020, 4,200 counterfeit bottles of Bolgheri Sassicaia, a prestigious (and very expensive) wine, were seized in operation “Bad Tuscan.” Revealing the international nature of counterfeiting, investigators said the fake wine originated in Sicily, the bottles came from Turkey, and the labels and wooden boxes came from Bulgaria. Furthermore, “The 2010 and 2015 vintages, celebrated by Italian and international critics, were the most prevalent among the fakes.”

As for the spirts industry, fake bourbon is hot right now and authorities nabbed 400+ liters of counterfeit vodka this month in Scotland.

To illustrate the problem more broadly, about 1.7 million liters of counterfeit alcohol was seized in Europe between December 2020 and June 2021. That haul was part of a joint INTERPOL-Europol operation called OPSON X, which netted almost 15,500 tons of illegal products with an estimated street value of nearly $60 million. Upwards of 68,000 checks were carried out by 72 participating countries, resulting in more than 1,000 criminal cases.

The upshot is that up to 20 percent of wine sold worldwide is fake and counterfeits cost the industry as much as $3 billion every year.

What can we do about it?

Counterfeiters and fraudsters exploit weaknesses. This is what gives them openings to assault your brand. The good news is that you can mitigate these weaknesses and gather real-time intelligence for effective brand protection strategies using your supply chain.

Your supply chain mirrors your brand. It’s the embodiment of your business. If it’s not healthy, your brand can’t be healthy. You need to be able to continuously scan it, diagnose it, and take immediate action should a threat arise.

Four supply chain solutions in particular are vital for wine brand protection: serialization, real-time monitoring, end-to-end traceability, and mobile traceability.

We talk about these in Part 2 of our brand protection series, “Brand Protection Strategies and Your Supply Chain.” Part 1 talks about top supply chain threats and your brand protection strategy. We encourage you to read these articles, as well as our consumer engagement series.

Final thoughts

Your success and reputation depend on how seriously you take brand protection. This means being able to authenticate every ingredient and every bottle. You have to monitor and prove storage conditions and provenance. You have to have deep, real-time insight into what you’re doing and where your products were, are, and will be. And you have to have the granular data to back up every claim and demonstrate to your customers that your wine is exactly what you say it is.

If you read our “Wine Consumer Engagement: Ten Things to Know for 2022” post from the other day, you saw that our mantra for wine consumer engagement is “A message in every bottle.” For wine brand protection, we like to say that you should tap into the “Brut” force of your supply chain. The short list of benefits includes:

- Fortify with supply chain data and protect with unique digital IDs
- Create an indelible provenance and create your product story
- Monitor in real time 24/7
- Inspire consumer trust and crowdsource brand protection
- Leverage IoT to eliminate blind spots
- Maintain chain of ownership
- Protect trading partners and consumers

And, of course, combat counterfeits and theft. Contact us today to learn more about pairing your brand with the finest supply chain solution for wine brand protection. Also be sure to read our other articles about the wine supply chain and why your supply chain is vital for effective brand protection and consumer engagement: