Counterfeit Goods and the Fashion Industry: How AI is Transforming the Way We Detect Fake Goods
- Amir Faraji
- Apr 4, 2023
- 3 min read
How Detrimental Are Counterfeit Products to Luxury Retailers?
Artificial intelligence technology is changing the way consumers and retailers can detect fake and counterfeit goods with the use of AI algorithms. producing and selling counterfeit clothing and luxury goods not only causes great financial detriment to the company and brand but also ruins the brand's reputation that consumers hold so high. Manufacturers are then blamed for these mishaps and consumers lose their trust in the brand. They leave negative reviews that result in 78% of potential prospects shopping online and in-store because these are evaluative reviews that people can trust. After all, they have the product in hand to use. Selling counterfeit luxury items is an incredibly lucrative business for those involved but, never for the designer or actual business producing the original goods. In times when e-commerce and second-hand luxury retailers are more prevalent than ever, businesses need a way to mitigate the sale of these revered goods as much as possible.
How Can the Use of Artificial Intelligence Combat the Sale of Fakes in the Luxury Sphere?
The firm Entrupy has created an AI algorithm that detects counterfeit luxury goods through image classification. How does it work? Well, to start, Entrupy is accessed via a mobile app for consumers. Then you take a collection of pictures of the product you want to authenticate using the app. Following this, the AI algorithm then takes these images and compares them against millions of other images of the same product found in Entrupy’s database. The artificial intelligence algorithm makes millions of comparisons and then provides the user with a decision regarding the authenticity of the product within seconds. As we know, what makes Artificial Intelligence so efficient is that like the human mind, it is constantly growing and learning after every use. AI stores the data received and uses it for future inquiries. The same goes for the Entrupy app, where the AI’s algorithm only sharpens its expertise after every use and becomes more adept at identifying counterfeit goods.
Why Artificial Intelligence?
Why might you choose an AI algorithm service over a human luxury goods expert? Experts and authenticators are hard to find and can be quite costly as it is a very niche service. They would have to constantly be up to date on the latest “it” bag or garment and preface themselves with the product before passing judgment. Entrupy’s Artificial Intelligence algorithm can preface itself with the features and composition of a product within seconds, and because AI is an evolutionary tool, all the luxury goods it has authenticated before will only improve its services later on. Most importantly, it mitigates the sales of counterfeit products which helps in building luxury retailers' reputations with customers, sellers, and manufacturers because it provides product transparency almost instantly.
Concluding Thoughts on AI and Detecting Counterfeit Goods
With the rise in second-hand luxury goods, return fraud, and fashions from yesteryear, this development in artificial intelligence-based business services is a retailing innovation businesses must consider when dealing with the uncertainty brought upon by the rise in counterfeit luxury goods. Services like Entrupy are only the beginning of what AI can do for luxury fashion retailers. It is reassuring for customers who are wary of buying second-hand goods, for business operators looking to venture into e-commerce and looking to prevent return fraud from occurring, and, for those of which who are looking to start a second-hand Luxury retail business with products dating back to previous fashion seasons.
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