How Smart Labeling Can Prevent Wine Fraud

Counterfeiting is an issue within different industries all over the world, and also is a serious problem in the global wine market. Since the late 1980’s more and more cases of really professional wine fraud occur. With the modernisation of wine industry and label printing, fraudsters gained access to more technologies to fake bottles and to print own labels at a very high quality. But there are several means how the printing industry can prevent counterfeits. Let us have a look at them.

A Brief History of Wine Fraud

But first let us start with a short history lesson: Due to the recent death of Hardy Rodenstock, a famous wine collector and one of the most famous counterfeiters, the topic popped up again in a wider audience. In 1985, Rodenstock “discovered” some old bottles of Bordeaux belonging to Thomas Jefferson and sold them to Christopher Forbes and Bill Koch. When Koch wanted to give these bottles to the Museum of Fine Arts for an exhibition in 2005, experts determined the bottles as fakes. This is how the era of professional wine fraud began. For instance, there were more vintage Lafite for sale in Hong Kong auction houses than were ever produced. In 2013, Rudy Kurniawan’s arrest was a major scandal. He had simply relabelled cheap bottles as expensive ones, and earned about 500 million dollar with selling these fakes at auctions. When it was uncovered that as many as 66.5 million bottles were counterfeit it sparked a public outcry, too. Affected were especially France’s Côtes du Rhône and Châteauneuf du Pape, as the bulk wine trading company Raphael Michelsold cheap red table wine as these premium labels since 2013 all over Europe. Next to the financial damage it also meant damage an image loss for the region and their brands.

Anti-Counterfeits Technologies from the Printing Industry

As there is not much space on a bottle to implement anti-counterfeiting technologies it is not surprising that the label became key when it comes to these things. As Jean Guillaume Prats, chairman of Chateau Cos d’Estournel, states in an article in Le Nouvel Economiste, the most practicable solution would be to ensure that the bottles are difficult to copy and easy to identify. Therefore the industry is using technologies, which are easy to bring up to a bottle or better to say, to the label. One way to print anti-counterfeit labels is to use holographic elements like these used for banknotes and passports. Covert parts, such as latent images are added to the label, only visible with a special detector. Additionally, these labels can be made tamper-evident to prevent a reuse, which is, as we know from the case of Rudy Kurniawan, a major problem. A similar way is to use special inks, especially when the items do not have a flat surface or not enough area to adhere a label to. For example, this is the case when the anti-counterfeit technology cannot be connected to the label.

A more technical approach is the usage of RFID (radio frequency identi­fication) and NFC (near field communication) technologies for the label printing. The idea behind both is to give the printed item some sort of own DNA making it really unique and preventing copies or reusal. Therefore, the label is equipped with a chip, which has a unique international identifier. With an additional NFC system, these information can be authenticated with any smartphone, for example, by the customer himself. A major advantage to QR (quick response) technologies is, that it does not require an application. Nevertheless, OriginTrail, a technology company from Slovenia, just launched a QR-based anti-counterfeit solution which uses a combination of photochromic ink, QR codes and a block-chain-based protocol. Identiv, a global provider of physical security and secure identification solutions, launched some months ago their newest RFID/NFC label, which is totally temper-proof due to a high innovative and state-of-the-art aluminium-etched antenna. Furthermore, the antenna is guaranteed to be destructed when the label is removed from the surface of the item.

Which Anti-Counterfeit Technology is the Best?

To name one solution as the best would be much too sweeping statement. Basically it depends on the pricing, the company’s budget and strategy. But, experts envision the RFID/NFC technology to surely rise in the next years and become increasingly important, since solutions like holograms are easier to copy. Other solutions like DNA protection are useful but very expensive and complicated as the authentication requires dedicated laboratory-type equipment. RFID/NFC are more likely to become mainstream. After all, they have a very good cost-benefit factor and are easy to use, especially as the customer can authenticate fakes directly at the supermarket. All in all, the conclusion for all brands and the industry remains the same: They have to update and develop their anti-counterfeit solutions to always be one step ahead the counterfeiters.