What is watermark technology for anti-counterfeiting ?

Industries are increasingly looking for innovative solutions to combat the ever-present threats of counterfeiting in a globalized commercial landscape.

As businesses look to protect their products and customers, watermarking has become a widespread method to fight counterfeiting.

With the applications for watermarking now going far beyond traditional uses such as banknotes and documents, how effective is a watermark in the modern commerce landscape? And how can you improve their effectiveness?

We’ll answer these questions and more in this deep dive into watermark technology for anti-counterfeiting.

How do watermarks work?

In traditional paper-based watermarking, the thickness of the paper is slightly altered by special tools which then reveal an image or logo when held up to light. Since this hidden watermark is almost invisible under normal circumstances, this is a covert way for authorized parties to authenticate items as being genuine.

It’s also difficult for counterfeiters to replicate this due to the special tools required to make the mark.

In modern digital watermarking, the idea is the same, with specific algorithms coding a digital ‘mark’ into a file that can then be decrypted and ‘read’ by other software designed to work in tandem.

Digital security watermarks often use elements of encryption to achieve this, making it extremely difficult for digital pirates to replicate or decode the marks to replicate for themselves in unauthorized versions.

Types of watermark technology

There are multiple kinds of watermarking solutions currently used today, with each being appropriate for a different sort of product. Common methods include:

• Visible watermarks. These are clearly visible marks like logos or lettering on the surface of an image, document or product. They’re normally used for copyright purposes and to deter counterfeiters.
• Invisible watermarks. These are a covert anti-counterfeiting solution and not visible to the naked eye. They’re used on paper and in digital products where users wouldn’t know they existed without special software.
• Digital watermarks. These are a form of invisible watermark specific to digital files such as media files. They’re used to track ownership and verify that content has been gained lawfully.
• Semi-visible watermarks. These are somewhat visible but need special circumstances to be clearly seen. This category would include old-fashioned document watermarks that had to be held up in the light.

The pros and cons of watermark solutions

Here are the main advantages of watermark solutions:

1. It’s cost-effective. Watermarking is relatively cheap which makes it accessible for manufacturers across a wide range of products.
2. It’s non-intrusive. Compared to more overt anti-counterfeit solutions, a watermark doesn’t impact the aesthetic appeal or ergonomics of a product or document. The fact that they are essentially 2D makes them ideal for artwork, luxury goods, and other visually sensitive items.
3. Watermarks are versatile. Watermarking has a broad spectrum of use cases since it can be applied to everything from physical products, paper currency, documents and digital media.
4. Watermarks are difficult to replicate. A high-quality watermark is inherently difficult to identify and replicate, making it difficult for counterfeiters to reproduce it without specialized tools or software.

And here are the main disadvantages:

1. Watermarking is vulnerable to advances in technology. As counterfeiting technology advances there is a risk that skilled counterfeiters will be able to bypass and replicate certain kinds of watermarks.
2. It offers limited protection against digital manipulation. Since watermarking software tends to rely on older programming and architecture, sophisticated hackers and counterfeiters might be able to read or pull data from digital watermarks. This would allow them to alter or replicate them.
3. They’re prone to physical wear and tear. Watermarks on physical items like products, packaging, or documents can fade over time, especially if they’re subject to changes in their environment like high heat, humidity, and friction.
4. They contain limited information. By their nature watermarks are usually a simple picture or icons, which means they aren’t multi-use and can’t hold any further product data apart from showing authenticity.

A solution to support anti-counterfeiting efforts

While watermark technology has advanced from its paper-based roots, it still isn’t a completely undefeatable solution to anti-counterfeiting.

A modern solution to use as an alternative, or in tandem with watermarks, is modern NFC-based solutions like Authentify It.

Unlike old-fashioned physical marks or more rudimentary digital watermarks, Authentify It holds immutable product data encrypted through blockchain in an easily readable minuscule NFC chip.

This data can’t be replicated or changed, making it far more secure than traditional methods.

The chip can be scanned by end users, retailers, and the wider supply chain by any smartphone, allowing manufacturers to verify authenticity, fight counterfeiting, and monitor issues like unauthorized grey market sales.

It’s also a completely new way to engage with consumers, boosting engagement post-sale and building brand trust.

Book a demo to learn more.