AI Supercharging U.S. E-Commerce Counterfeit Crisis
Counterfeit food and beverage products are becoming a growing concern in the United States, with recent data revealing a dramatic tenfold increase in food fraud incidents between 2020 and 2024. High-risk categories like dairy, seafood, and beverages remain prime targets for bad actors exploiting supply chain vulnerabilities. As this underground economy expands, industry leaders are ramping up defenses—fueling a surge in anti-counterfeit packaging technologies.
Valued at $138.8 billion in 2024, the global market for these protective solutions is projected to reach $234.7 billion by 2030. Driving this growth are AI and machine learning innovations, which enable more proactive fraud detection. Yet even with advanced tech, the challenge persists—calling for stronger enforcement, smarter regulation, and continued collaboration across sectors to protect consumers and maintain brand trust.
An explosive new report, “The Counterfeit Buyer Teardown,” paints a concerning picture of a rapidly evolving and increasingly sophisticated counterfeit goods market, driven by a new factor: Artificial Intelligence. Forget the back alleys; findings from the research—conducted by market research firm OnePoll and AI company Red Points in February 2025—highlight that the future of fakes is digital, AI-assisted, and alarmingly mainstream.
The convergence of technology, social media, and shifting consumer mindsets is reshaping e-commerce—and not always for the better. As AI accelerates both the spread and appeal of counterfeit goods, the challenge is no longer just spotting fakes—it’s confronting a counterfeit economy that’s growing smarter, faster, and harder to contain.
“As counterfeiters adopt advanced tools like AI, the fight against fakes is becoming more complex and more urgent,” said Laura Urquizu, CEO & President of Red Points. “We’re now seeing AI shape both the threat and the solution. In 2024 alone, our firm detected 4.3 million counterfeit infringements online—an alarming 15% increase year-over-year.”
Alarming indeed. Here are 5 key revelations from the study.
1. AI is the New Enabler of Counterfeiting – A Two-Sided Threat:
- The Counterfeiters’ Edge: AI is dramatically lowering the barrier to entry for bad actors. They can now mimic brand listings, and impersonate social media accounts with unprecedented ease and speed. They can also effortlessly create professional-looking fake websites—a situation that, according to Red Points’ data, is projected to surge 70% in 2025. This isn’t just about cheap knock-offs anymore; it’s about sophisticated deception at scale.
- The Consumers’ Assistant: Shockingly, 28% of online shoppers who bought fake goods used AI tools to find This isn’t a fringe behavior; it’s a growing trend, especially among Gen X, suggesting consumers are actively leveraging AI in their pursuit of cheaper alternatives. This fundamentally shifts the narrative – it’s not just about being tricked; some are actively seeking fakes with AI’s help.
2. Accidental Counterfeiting is a Major Problem – Trust Signals are Being Hijacked:
- 1 in 4 luxury counterfeit purchases are unintentional. This shatters the perception that buyers knowingly seek out high-end fakes. Realistic pricing, secure payment promises, and active (but fake) social media presence are successfully deceiving consumers. AI-generated legitimacy cues are becoming indistinguishable from the real deal.
- Brands are Paying the Price for These Mistakes: A staggering one in three shoppers stop buying from the genuine brand after an accidental counterfeit experience. This highlights the significant damage to brand loyalty and future sales, even when the brand isn’t directly selling the fake. High-trust categories like luxury and toys are particularly vulnerable.
3. The “Dupe Economy” is Real and Influencer-Driven:
- Nearly a third (31%) of intentional counterfeit buyers were swayed by influencer promotions. Social media is driving the demand for “dupes” – budget-friendly replicas. Authenticity is taking a backseat to price and perceived identical appearance, especially among younger demographics.
- This isn’t just about saving money; it’s a shift in consumer mindset. The report suggests a growing acceptance of fakes as clever alternatives, fueled by social validation and influencer endorsements.
4. Marketplaces Remain Key, But Social Media and Fake Websites are Surging:
- Marketplaces (both US and China-based) are still the primary channels for counterfeit purchases. However, fake websites (accounting for 34% of unintentional purchases) and social media are rapidly gaining ground as sophisticated avenues for distribution, amplified by AI’s ability to create convincing facades.
- Social media ads redirecting to infringing websites saw a massive 179% year-over-year growth. This highlights the increasing sophistication of counterfeiters in leveraging advertising platforms to drive traffic to their fake storefronts.
5. Younger Generations are More Vulnerable in Key Categories:
- Millennials are significantly more likely to have their personal data stolen after purchasing from fake websites (44% vs. 34% average). This suggests a higher susceptibility to sophisticated phishing scams disguised as legitimate e-commerce sites.
- Gen Z and Millennials are 2-4 times more likely to accidentally purchase counterfeit luxury goods and toys compared to Baby Boomers. Their online savviness might be a double-edged sword, making them more exposed to deceptive listings.
This study serves as both a consumer alert and a brand wake-up call. The rise of AI as a tool for both counterfeiters and consumers is a seismic shift that demands urgent attention. With compelling data and a clear-eyed look at accidental purchases, influencer-driven “dupe culture,” and the growing sophistication of fake storefronts, the findings paint a stark warning for the future of online shopping.
“Counterfeiting poses a serious and evolving threat to innovative businesses and consumer safety,” notes Piotr Stryszowski, Senior Economist at the Organization for Economic Co-operation and Development (OECD). “Criminals constantly adapt, exploiting new technologies and shifting market trends—particularly in the online environment. To effectively counter this threat, policymakers need detailed, up-to-date information. This study makes an important contribution to our understanding of how counterfeiters operate and how consumers behave online.”
Ultimately, The Counterfeit Buyer Teardown report underscores a new reality: counterfeiting is no longer confined to shady sellers or easily spotted scams—it’s embedded in the very technologies shaping modern commerce. As AI continues to blur the lines between real and fake, the pressure is on for brands, platforms, and policymakers to respond with equal speed and sophistication. Combating this growing threat will require more than just awareness—it demands collaboration, innovation, and a commitment to restoring trust in the digital marketplace before the counterfeit economy becomes the new normal.
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Merilee Kern, MBA is a brand strategist and analyst who reports on industry change makers, movers, shakers and innovators: field experts and thought leaders, brands, products, services, destinations and events. Connect with her at www.TheLuxeList.com and LinkedIN www.LinkedIn.com/in/MerileeKern.
Source: https://get.redpoints.com/the-counterfeit-buyer-teardown-2025
