by Cassandra Balentine
Security is an increasing concern for print providers and buyers. This is true for both securing sensitive documents as well as adding brand protection. Not only is it becoming important to thwart counterfeiting and product tampering, it is an opportunity to add value to print.
Shown: Covectra’s StellaGuard smart security label solution leverages the advantages of a barcode and connects it with a three-dimensional visual reference that provides instantaneous authentication with copy-detect protection.
“Having integrity and security in all phases of print is not optional—it’s essential,” asserts Bill Donnelly, senior marketing and campaign strategy manager, Ricoh USA, Inc.
According to an April 2021 report by Research and Markets, Security Printing Market – Forecasts from 2021 to 2026, the security printing market was estimated to be valued at $31.3 billion in 2019. At a growth rate of 5.3 percent, it is projected to have an estimated value of $45.0 billion by 2026.
The research firm defines security printing as a division of the printing industry that undertakes the task of printing checks, banknotes, passports, tickets, identity cards (ID), authentication cards, and others.
“The prime goal of security printing is to prevent the cases and possibilities of counterfeiting, tampering, and forgery,” states the report.
Several areas of the print process help combat criminal acts and protect brands, currency, products, and individuals.
Matti Broza, business development, Indigo Division, HP, Inc., points out that HP looks at security from two different segments—security printing and advanced brand protection. He explains that for security printing, it’s the document itself that you’re securing. This is used by governments, regulators, and other institutions that produce printed materials that they and their partners must be able to track, authenticate, and often identify at different points in a workflow. The primary purpose of security printing here is to prevent counterfeiting and having the ability to prove the authenticity/originality of security printed documents. High-security printing applications include governmental—banknotes, postage stamps, tax stamps, passports, visas, personal ID documents, birth certificates, drivers’ licenses; financial—bank guarantees, mortgages, checks, and other documents with value, like lottery tickets, coupons and vouchers, and transit/event tickets.
When it comes to printing for brand protection, enterprises use secure-printing features to demonstrate the authenticity of a product. This helps to keep low-quality, often dangerous, counterfeit goods out of the supply chain, and in turn, will not only keep consumers safe but also protect brand revenue streams and reputations.
The primary applications of brand protection include security labels and on-package security features. Leading industry adopters include pharmaceuticals; nutraceuticals and wellness; cosmetics and personal care; controlled food, spirits, and beverages; electronics; agro-chem; and industrial and automotive.
Security & Brand Protection Demand
There is continuous demand for security printing as the efforts of bad actors lead to lost revenues, cost, and reputation damage to brand owners.
The biggest concern for brand manager is the cost of being counterfeited, which the repercussions, according to Ron Ducharme, VP, business development, Covectra, including everything from repairing your reputation to facing lawsuits in wrongful death cases. “I know this sounds extreme, but what if a cosmetic is counterfeited using cancer-causing metals or automotive breaks are made from substandard parts and your car does not stop? Unfortunately, these stories are true. Not only does a company lose profits to reinvest into new products and people, they also have the cost of defending themselves. Many larger companies have entire departments internally to monitor their products and brands. What about smaller companies that do not have these resources?
Louis Rouhaud, global marketing director, Arjobex, a company of the Polyart Group, suggests worldwide and in the U.S., security printing is adopted by government agencies, followed by banks. In the brand protection market—after states and banks—top adopters include medical and pharma companies, alcohol and spirits, followed by cosmetics and luxury products.
“The cost of diversion, counterfeiting, and piracy, according to the International Monetary Fund, will be approximately $2.8 trillion in 2022. That would be comparable to the sixth largest economy in the world. So yes, there is an increased demand by brand owners to prevent and recover lost sales and profits,” offers Michael Brice, VP of sales and business development, INX International Ink Co.
Donnelly predicts that demand for heightened security will only continue to grow in print as guidelines evolve. “Consider that the healthcare industry must adhere to strict HIPAA compliance regulations, and financial institutions and insurance companies have specific data integrity and security requirements.
These are only two examples, as companies—regardless of industry—are being held to higher standards than ever before to keep data secure. There are serious security implications if a customer gets the wrong explanation of benefits, reimbursement checks, 401K distribution checks, or insurance checks to pay on a claim. The resulting damage could be catastrophic to customer confidence in the brand or, worse, lead to litigation or loss of a lucrative contract for the commercial printer.”
Brian Brogger, president, Microtrace Solutions, believes there is always a demand for security printing solutions. “Companies need to first ask themselves if they are looking for true security and deterrent or if they simply want to provide an illusion of security. There are applications for all, and this can only be determined by brand owners.”
Randall Burgess, global director of graphic security sales, government/enterprise, New ProImage America, an AGFA Company, believes the true demand is much lower than many reports, which are based on algorithms extrapolated from the packaging market. “Most food and pharmaceutical packages remain unmarked except for SKU and UID codes. Because security print is the most cost-effective method of marking, it is still expected by many to eventually become the first line of defense.”
Trending in Security
There is plenty of incentive and necessity for security printing and brand protection in today’s world. These are not only driven by the threat of criminal activity, but available technologies.
“Trends in the security print market are driven by a range of changes in the marketplace—for example, something as simple as physical check demands evolving or industry-driven regulations in healthcare, insurance, and finance. Customers don’t want to invest in a high-cost machine dedicated to a single function or operation. Having the capability to offer counter measures such as invisible red, MICR, and full-color check printing in a single production sheet-fed device offers our clients and prospects an opportunity to reduce touches and manual intervention—automation eliminates unnecessary steps in the process,” shares Donnelly.
He expects security printing to continue to play an important role in digital transformation by reducing chain of custody or eliminating manual touch points, which require labor and increase the inadvertent introduction of human error.
Burgess notes that security printing for breeder documents—the documents used to obtain IDs and IDs, passports, excise stamps, and currency should remain steady. However, security printing for brand protection is a collection of micro markets without a uniform driver except for obtaining greater visibility.
“This should increase as we see current supply chain models under strain and shifting but has yet to be determined. Fraud may be increasing for shipping paperwork, bills of lading, container labels, certificates of analysis, certificates of authenticity, etc., but to date many of these don’t have a standard or a unified body interested in driving forward a standard.”
There is also increased need for solutions that cannot be replicated by a counterfeiter and also verified by consumers at point of sale, specifically without the need for special tools or detectors beyond a smartphone. “I think a large driver for this is two-fold. First, smartphones have become a way of life and a source of information. Product authentication is a natural next step for use of smart devices and having consumers help police the brand is intriguing. Secondly, consumers have an increasing desire to know the origin and story of their product. The ability to verify using a smart device and then learning more about their product is important to many,” shares Brogger.
Tamper-evident labels and packaging are also an option. Rouhaud points out that products like Polyart TE offer the look and printability of paper, but with the durability of plastic—including resistance to tearing, water, grease, and most chemicals. At the first attempt at removal, however, the label with delaminate to prove tampering.
Another trend is reducing or eliminating the costly use of pre-printed shells. “Printing the variable background data and MICR in one process is much more efficient, and extra security countermeasures can be added,” says Donnelly.
In general digital printing makes it easier to include security printing measures.
The COVID-19 pandemic has shifted projections for security printing. “COVID-19 created an increased demand for online purchases. With it comes the risk of purchasing counterfeit goods from unauthorized sources,” says Brice.
Brogger agrees, noting that COVID-19 has affected the need for security printing. “Pressures on supply chains and price inflation have provided windows for counterfeiters to enter placing a larger number of non-authentic, inferior products in the market.”
Donnelly adds that many areas of security printing were affected by the pandemic as it required companies to do more printing with less staff, all while customers across a range of industries were expecting insurance payouts, healthcare communications, bank statements, and unemployment benefits. It also impacted the ability to produce reprints of lost and/or damaged checks; customers could not wait for the next check run. “They needed their payments to cover payroll, supplies, and costs to maintain operation during a time when everything was tighter and more stressful.”
Overt and Covert
Among the types of security printing and brand protection options are overt and covert sub sectors. Simply put, overt options are seen while covert are unseen.
“Overt security methods are either tactile or visible to the naked eye. One example is quick response (QR)/barcodes, marks, or images that are specific to the product/brand,” suggests Brice.
Thermocromic and photocromic inks are also overt examples, as well as watermarks, magnetic strips, holograms, or security threads.
Overt options provide brand owners and consumers with some level of brand protection and comfort that the product is what it says it is, as well as being healthy and safe. “The limitation is they are overt and can be duplicated. To the untrained eye, they might pass inspection” cautions Brice.
For overt security printing features to deliver true security, they must be unique enough to the unaided eye so as not to be easily fooled by similar counterfeit features. Brogger warns that this is a major challenge for overt security features.
When it comes to overt security printing features, the benefits and limitations are one in the same. “The technology is easy to use, well established, and readily available. It’s fairly easy to print checks for a nefarious purpose if you have the knowledge. Counterfeit checks have long been and continue to be an area of concern for financial institutions and manual review to detect forgeries or reproductions is not always effective,” adds Donnelly.
Brogger points out that the wide use of smartphones has changed our interactions with the world around us, including what the definition of overt is as related to security features read with a smartphone. “Microtrace’s encrypted barcodes appear to be standard barcodes and are ‘overt’ however, these barcodes have covert features that when read by a smartphone cannot be counterfeited or copied,” he offers.
Another example of this is formulating a visible ink with a special taggant incorporated into it that allows for detection/authentication. “The bad actor would not know the printed piece has that taggant and if they tried to replicate it, the product would not illuminate or be detected. Thus, it would be determined to be counterfeit,” shares Brice.
Covert security printing features are hidden to the naked eye and often require some checking mechanism to validate. Invisible marks, codes, or images applied via conventional or digital printing methods are good examples of covert security printing. These inks have a patented taggant from a secure source.
Another example of covert security print is formulating a visible ink with a special taggant incorporated into it that allows for detection/authentication; this could also be considered an overt security method. “The bad actor would not know the printed piece has that taggant and if they tried to replicate it, the product would not illuminate or be detected. Thus, it would be determined to be counterfeit,” explains Brice.
“Good covert security countermeasures include invisible watermarks on the paper that can be seen by holding a check up to a strong light; UV inks only visible with a UV light; and microprinting, which is used for paper money and traveler’s checks,” offers Donnelly.
However, the covert security printing process is often expensive and involves special ink, printing plates with etched grooves that fill with ink, and special fiber-content paper that has the image from the steel plate forced onto it with more than 20 tons of pressure during the printing process. “The ink is layered into, on, and above the paper, giving some lines a raised feel that is very difficult to effectively duplicate,” explains Donnelly.
Security functions of paper only goes so far. Adding digital makes all the difference. “Printing with clear toner as a watermark, for example, or using invisible red toner in lieu of UV, are inexpensive counter measures in an application that requires covert secure printing at a lower cost to in-plants and commercial printers,” says Donnelly.
Brogger points out that the most successful covert security printing is chemistry based, including spectral taggant, or encrypted barcodes. Equally important is the accuracy of the detection equipment and data processing.
Benefits and limits are the same as above. “In working with objects, the object within the object can be changed in a few seconds, so designs can be easily updated by month or year. The creativity of the designer is the main limiting factor,” comments Burgess of covert security printing.
All aspects of the signature from raw materials, chemistries, and formulation as well as application engineering and data collection and analysis must be precise and tightly controlled. “It is the best to have a single company provide the full system to ensure there are no gaps,” notes Brogger.
Ducharme points out that counterfeiters have become so sophisticated that any type of security must be a combination of overt and covert technologies.
The need for security and brand protection solutions and is real, but it is also expensive and must be done correctly.
“Unfortunately, the industry as a whole has not taken steps to stay ahead of counterfeiters, Some companies take advantage of older technologies, which are far less costly. These play into the hands of the counterfeiters who have become better at what they do,” cautions Ducharme.
Both covert and overt solutions lead to customer confidence for sensitive document production, and should be considered as a way to add value to printed output. Catch a replay of a webinar on this topic at dpsmagazine.com/webinars.
Jul2022, DPS Magazine