When making the business case for an online brand protection program it is important to present the return on investment to your company’s financial team. Because of the widespread nature and volume of online infringement, our experience tells us that two very measurable areas of benefit—returned traffic and substitute sales rates—will produce a calculable ROI that is many times the cost of deploying a brand protection program. Here’s how you can measure returned traffic and substitute sales rates to demonstrate ROI for your business.
With well-known brands, there are typically thousands of sites designed with the sole purpose of siphoning traffic away from legitimate brand sites to sites that seek profit from the brand lure. The business model for these sites is usually based on pay-per-click advertising or the sale of counterfeit goods. In some cases, these sites have the trademarked name in the URL (e.g., cheapbrand.com), but more frequently they have the name or logo in the page content or embedded into the meta tags of the site.
For the brand, these tactics represent stolen traffic and, in many cases, very large volumes of it. Fortunately, these tactics are measurable and you can find out how many visitors the infringing sites receive. This makes it possible for you to target the really important websites which are getting the highest volume of traffic, and also to start building a picture of the scale of the loss in monetary terms. Obviously not all traffic that is going to an infringing site is retrievable, but if the infringing sites weren’t showing up in search engine results, it is very likely that a reasonable proportion of that stolen traffic would instead go to the brand’s site.
Once you measure how many visits were stolen and form a reasonable estimate of what proportion could be retrieved, it is not difficult to attribute a value to those visits. Every online marketing department knows the conversion rate (what percentage of traffic turns into buyers) and average transaction value of their online stores. This is an excellent opportunity for experts in ecommerce, digital marketing, brand protection and legal departments to work together to demonstrate how reclaimed visits can be shown as real amounts of money that the business will gain.
The other truly measurable element of financial gain from an online brand protection project is substitute sales. The rates for these types of sales differ between product types, price points and even distribution channels. In constructing an ROI model, it is important that the brand errs towards the conservative.
Once we understand the substitution sales rate for a given product line, the next step is to identify how many counterfeit items the brand protection program is removing from sale and calculate a return in terms of additional sales for the brand. For some online marketplaces, this is very simple as they provide this kind of detail for their legitimate sellers’ benefit. Once you have identified the highest-volume infringing sellers, you can obtain the exact data about their sales’ volume, and the quantities removed from sale as listings are removed and sellers shut down. For e-commerce websites, you can use traffic measurement tools to identify how many visits per month each infringing site is obtaining and then apply the brand’s own conversion ratios to obtain sales volumes.
As long as conservative estimations have been used throughout this process, the results should be clear and a real reflection of the benefits that will accrue from your brand protection program.