Marketing Profs

By now, organizations with any type of Web presence are aware of the threat of phishing and customer identity theft. As a result, they are becoming increasingly vigilant about putting the security measures in place to detect and mitigate damage from viruses and other, more-evident malicious acts.

What they don't always realize, however, is that online incidents can extend well beyond the most obvious instances of fraud. Few, in fact, are actually focusing on the "collateral damage" that comes with the hundreds of thousands of brand infractions that happen online every day.

Granted, only 10 percent of those infractions might be considered serious or actionable. For example, when a charitable organization that a company is supporting cuts and pastes a logo onto its site, that is hardly worth a second thought. But when a company's good name is used to perpetrate frauds or scams, it can be extremely damaging for business indeed.

Take the case of a North American retailer that was presented with thousands of fake discount coupons printed from unauthorized Web sites. Because of the company's policy of honoring coupons, the company experienced a measurable drop in revenues and profits as a direct result from accepting fraudulent discount codes.

Or consider the instance of an international entertainment company that had its well-known cartoon characters recreated and featured on a range of online pornography sites. In addition to potentially exposing young children to highly offensive material, this incident resulted in a loss of customer trust.

Even activities that seem innocuous can have unintended consequences. For instance, not all companies recognize the negative implications that can accrue when online criminals post fake job listings for well-known companies. By accessing the detailed information contained in the resumes that they collect, fraudsters are using recognizable brands to commit identity theft.

Infractions don't always originate externally. In one case, the authorized resellers of a global automotive manufacturer were featuring famous songs on their Web sites without a proper license. This lack of compliance from its own channel partners left the company responsible for significant royalty payments.

An Attitude of Constant Vigilance

As those examples show, online infractions are increasingly diverse. In fact, some online-threat experts have identified dozens of categories of Internet brand infractions (fraudulent activity) and domain-name infractions that have the capacity to damage brand reputation.

To protect customers and their own good name, organizations must continuously monitor how their brands are being used online. By understanding the types of incidents they may be subject to, companies can develop policies for prioritizing potential threats and put in place appropriate response measures to mitigate exposure and damage.