Skip to main content
/world business
Digital Biz

Brand-jacking: business battles online scammers

  • Story Highlights
  • Businesses face constant battle to protect their brand name
  • Most of the Fortune 100 employ companies to spot brand abuse
  • Scams becoming more sophisticated and spread to more everyday marques
  • Next Article in World Business »
By Steve Mollman for CNN
Decrease font Decrease font
Enlarge font Enlarge font

(CNN) -- What's in a name? If it's a big brand name, plenty. The top 100 global brands have a combined value of $1.2 trillion, estimates consultancy Interbrand. That's bound to attract online scammers.

art.handbag.jpg

From the market to the internet, online scams and brand-jacking techniques are getting more sophisticated.

The value of a brand lies largely in the trust that's been built up in consumers over many years. But online con-men and counterfeiters can capitalize on that trust in an instant with scams that hurt brand owners and consumers alike. And their scams just keep getting more sophisticated.

You might know, for instance, that you should ignore emails that are supposedly from your bank but actually are "phishing" for your password or other personal information. But you're probably not ready for "vishing," a newer strategy that capitalizes on automated dialing systems and the public's trust in landline phone services.

With this scam you receive a phone call at home in which an automated recording, supposedly from your bank, tells you there's been unusual activity on your credit card or bank account and that you must call an assigned number immediately. Even your Caller ID feature might not save you because the scammers can use voice over IP in a way that makes your bank's name appear on the phone's display.

When you call, you'll be asked to enter personal information that the "vishers" are eager to acquire: credit card number, expiration date, security code, and so on.

On your cell phone, watch out for text messages that appear to be from your bank but again are scams hoping you'll give away personal details (they've been given the monitor "SMishers" -- "SMS" plus "phishers"). Such scams depend on you replying in some way, so to beat them you can simply delete the message or hang up.

However, for brand owners, things are more complicated. It's nearly impossible to keep track of all the ways a major brand is being abused online at any given time. The Italian fashion giant Gucci can't hunt down every last counterfeiter hijacking its brand in online auctions, or bogus e-commerce sites like guccifendi.com that has now shut down.

Many companies turn to firms that specialize in identifying and prioritizing brand abuse online. These include, among others, Net Enforcers, Brand Intelligence and MarkMonitor.

The latter, which claims over half the Fortune 100 as clients, says one of its apparel clients takes down about a million dollars in illegitimate sales each week from online auctions and bogus e-commerce sites.

The firm released an annual brand-jacking report this month that highlights the challenges brand owners face.

For instance cyber-squatting, where a brand name is used illegitimately in a domain name (like guccifendi.com), jumped 33 percent last year, according to the report. The firm observed more than 380,000 instances of cyber-squatting in the fourth quarter alone. One reason for the strategy's popularity is that having a brand name in a web address increases a site's chances of appearing in search results.

While brand owners can defensively buy some domain names that are obvious targets for abuse, it's impossible to cover everything. That's because the number of ways in which a brand name might be combined with something else is nearly infinite.

Toyota, for instance, was not amused to discover a site called LexusCash.com (now closed down) that was pornographic in nature. Disney also must contend with sex sites using its names. It's impossible to catch everything, of course, so one of the most valuable services that monitoring firms provide is simply prioritizing the abuses, starting with the most egregious or offensive. The brand owners often take it from there.

The report also says that more companies in new categories are becoming fresh targets as the Web continues to broaden.

In the fourth quarter of last year, more than 120 organizations became first-time victims of "phishing," and the number of "phishing" victims overall jumped 38 percent from the previous quarter.

Scammers are enlisting ever more brands, often in categories as pedestrian as automotive parts or household cleaning products.

"There are some great new gambits that have been good at attracting all kinds of new 'customers,'" says Frederick Felman, chief marketing officer of MarkMonitor. "The 'phishers' continue to be real innovators and entrepreneurs." E-mail to a friend E-mail to a friend

All About Technology

  • E-mail
  • Save
  • Print
Home  |  World  |  U.S.  |  Politics  |  Crime  |  Entertainment  |  Health  |  Tech  |  Travel  |  Living  |  Money  |  Sports  |  Time.com
© 2014 Cable News Network. Turner Broadcasting System, Inc. All Rights Reserved.