Advertisers are spending more money online but big brand name firms are losing their reputation, customers and millions of dollars in sales, to shady marketers.
According to a report by MarkMonitor, deceptive marketing tactics to build traffic for rogue sites to sell fake branded products rose 17%, last year.
These shady marketers are using so-called cybersquatting to digitally steal credit card information, generate clicks on ads to skim revenue from online ad networks or to sell fake products like pharmaceuticals or expensive handbags.
These rogue marketers target electronics, sports apparel, luxury brands and pharmaceutical brands the most. They cost these brand name companies about $175 billion worldwide in lost revenue.
The daily incidences of cybersquatting against 30 of the top global brands rose to 449,484 last year versus 382,246 in 2007. Recent study says that big brands are more vulnerable to infringement online compared to other media as 29.5% of the 300 companies reported brand infringement on the internet versus 22.6% in other media.
Despite the big loss suffered by companies to cyber criminals, few of them invest in protecting their brands online. The report said 52% of the companies spend less than $100,000 on brand protection each year. Only 2.7% of them said they spend $5 million or more.
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