The frequency and impact of the growing problem of brand impersonation is putting consumers at increased risk of privacy and personal data issues—and wreaking havoc on the brands affected. New research from consumer protection firm YouMail Protective Services reveals that such imposter attacks have huge reach across all demographics—not only including younger generations, but impacting them more than older ones—causing large monetary losses, and substantial material harm to brand reputations.
Brand impersonation schemes involve malicious actors deploying robocalls or text messages to impersonate a prominent company to scam the receiver into giving away personal data, account credentials, payments, and more. The study found that scammers most frequently pose as financial institutions and package delivery companies. These findings correlate with the firm’s own Sensor Network data, which also sees brand impersonations of big hotel chains, cruise ship lines, computer and IT service companies, and many other types of well-known consumer-focused industries.
Highlighted findings from the survey include:
Brand Impersonation scams are ubiquitous
More than 3 out of 4 of survey respondents (78 percent) said they have been the target of brand impersonation scams. This translates to well over 200 million people in the U.S. who have been targeted. The most common scams were financial services (51 percent), package delivery companies (49 percent), e-commerce sites and online stores (45 percent), and hospitality services (21 percent).
Further, almost half of all respondents (45 percent) reported getting 10 or more of these scam calls and texts per month. This translates to over 125 million Americans receiving multiple brand impersonation scam calls each week—a stunningly large number.
Brand impersonation scams affect the young more than the old
Over 9 in 10 of Gen Z respondents aged 18-26 (93 percent) have received brand impersonation scam calls and texts, vs. about 7 in 10 Baby Boomers aged 59 and older (73 percent). This contrast suggests that young people are getting more of the imposter scam calls than the old, despite older adults generally thought to be targeted and most at risk.
Further, 1 in 6 of Gen Z (17 percent) and 1 in 5 of Millennial respondents aged 27-42 (20 percent) suffered financial losses from scams, compared to only 1 in 17 of Boomers (6 percent)—revealing that younger generations appear to be about three times more likely to suffer financial losses from an imposter scam than the oldest adults.
Brand impersonation scams are costly
The survey results imply that Americans have lost a cumulative $40 billion from brand impersonation scams that originated from robocalls or robotexts. This financial impact is a staggering price to pay, though perhaps not surprising given that Americans receive more than 50 billion robocalls per year.
Specifically, more than 1 in 7 survey respondents (15 percent) endured actual financial losses due to these scams, which translates to over 38 million U.S. adults. The hardest hit group involved 6% of consumers who lost $1,000 or more, or over 15 million adults, followed by 22 percent who lost between $99 and $999.
Brand impersonation scams severely harm brands—in some cases forever
Over half of respondents (55 percent) said they would complain to the original brand about impersonation, leading to costs for the brand in dealing with those contacts, and even higher costs when the brand tries to help the consumer address the losses.
Further, roughly half of survey respondents (47 percent) said they are less likely to accept calls or texts from brands that have suffered imposter calls, making it harder and more costly for brands to contact their prospects and customers. Similarly, just under half of respondents (45 percent) said they would simply lose trust in doing business with the original brand, leading to losses in revenue for the brands as the consumers do less or no future business with them.
Check out YouMail’s blog post for more information.
For this research, YouMail Protective Services surveyed 361 U.S. consumers drawn from a representative cross-section of age groups, geographic regions, and income levels in March 2023.