Herschel Deploys AI to Combat Fakes in Key Digital Brands Group Deal

AUSTIN, TX – December 16, 2025 – In a significant move to protect its global brand identity, accessories giant Herschel Supply Co. has partnered with Digital Brands Group, Inc. (NASDAQ:DBGI) to deploy an advanced artificial intelligence platform aimed at fighting the rampant spread of online counterfeits. The collaboration will see Herschel implement the AssetSafe™ platform from SECUR3D Inc., an AI-driven solution designed to automatically detect, monitor, and remove unauthorized brand usage across the web.

This partnership marks a critical step for Herschel, a brand sold in over 90 countries, as it seeks to safeguard consumer trust and the integrity of its products in an increasingly perilous digital marketplace. For Digital Brands Group, it signals a major strategic expansion beyond its core apparel business into the high-growth sector of technology-enabled brand protection services.

The Soaring Cost of Digital Deception

The decision to enlist AI-powered sentinels comes as brands face an unprecedented onslaught from counterfeiters. The problem of fake goods and intellectual property (IP) infringement online has ballooned into a multi-billion-dollar shadow industry, eroding brand value and deceiving consumers. The global market for brand protection software, a direct response to this crisis, was valued at over $2.6 billion in 2024 and is projected to surge past $6.2 billion by 2033, fueled by what more than 84% of businesses describe as a noticeable increase in counterfeit activities.

The apparel and accessories sector is on the front lines of this battle. Industry groups like the American Apparel & Footwear Association (AAFA) have repeatedly warned of the dangers posed by fakes, which often fail to meet basic safety standards. In recent tests, over a third of counterfeit products were found to contain hazardous chemicals, such as lead and phthalates, in levels far exceeding legal limits. This digital black market is further amplified by social media trends, where "dupe influencers" promote knockoff products, often blurring the lines between inspiration and outright infringement and exposing consumers to unsafe goods potentially linked to organized crime. With online shopping scams ranking as the second-most reported type of fraud in the U.S. last year, the need for proactive, scalable solutions has never been more urgent.

A Strategic Pivot for Digital Brands Group

For Digital Brands Group, this partnership represents more than just a new client; it embodies a calculated evolution of its business model. Traditionally focused on a portfolio of direct-to-consumer apparel brands, the company is now positioning itself as a technology enabler for the broader retail ecosystem. This move into AI-powered services is a significant diversification, intended to create new, scalable revenue streams.

Hil Davis, CEO of Digital Brands Group, framed the initiative as a foundational step. “Herschel is one of the most recognizable lifestyle brands in the world, and protecting brand integrity at scale has become essential in today’s digital economy,” he stated. “This collaboration represents the first of many large consumer brands we expect to bring onto our AI-powered brand protection initiative as we expand partnerships across the global ecommerce landscape.”

This strategic pivot comes at a crucial time for the company. Recent financial reports have shown challenges in its core apparel segment, with net revenues for the first nine months of 2025 at $5.8 million, down from $9.4 million in the prior year, alongside a net loss of $7.7 million. By expanding into the high-growth brand protection software market, DBG is not only adding a valuable service for its own brands and partners but is also tapping into a sector with a robust growth trajectory. This diversification appears to be a key component of its long-term strategy to build a more resilient and valuable business by integrating technology directly into the retail value chain.

Herschel's Proactive Defense in a High-Stakes Game

For a brand with the global reach of Herschel Supply Co., maintaining authenticity is paramount. Founded in 2009, its backpacks and accessories have become ubiquitous, making the brand a prime target for counterfeiters looking to capitalize on its popularity. The deployment of SECUR3D's AssetSafe™ platform is a proactive, rather than reactive, measure to fortify its defenses.

The AI platform will continuously scan online marketplaces, social media platforms, and rogue websites for counterfeit listings, unauthorized use of trademarks, and copied product designs. By automating the detection and enforcement process, Herschel can address infringements at a scale and speed that would be impossible through manual efforts alone. This not only protects revenue that would otherwise be lost to fraudulent sellers but, more importantly, it protects the consumer. Shoppers who purchase a fake Herschel product are often left with a poor-quality item that lacks the durability and design integrity of the genuine article, leading to a loss of trust and long-term damage to the brand’s reputation. By investing in this technology, Herschel is sending a clear message that it is committed to ensuring its customers receive the authentic products they expect.

The AI Arms Race in Brand Protection

The partnership between DBG and Herschel highlights a broader "arms race" in the retail industry, where AI has become the weapon of choice against digital fraud. SECUR3D's AssetSafe™ platform enters a competitive and technologically sophisticated market populated by established players like Red Points, BrandShield, and MarqVision. These companies leverage advanced machine learning, image recognition, and data analysis to provide 24/7 surveillance for their clients.

Platforms like Red Points, for example, boast an AI trained over a decade on billions of data points to identify infringing content, even when counterfeiters attempt to evade detection by altering images or product descriptions. Others, like BrandShield, specialize in real-time detection of phishing schemes and fraudulent social media accounts that impersonate brands. The core technology often involves AI models that can "see" and "read" the internet like a human, but at an infinitely greater scale. They identify suspicious patterns, verify seller authenticity, and trigger automated takedown requests with major e-commerce platforms and domain registrars.

As this technology evolves, some in the industry are also looking toward blockchain for supply chain traceability and product authentication, creating a permanent and transparent record of a product's journey from factory to consumer. The move by Digital Brands Group to facilitate access to these advanced tools for partners like Herschel underscores a fundamental shift in modern commerce. Brand management is no longer just about marketing and product design; it now requires a sophisticated technological infrastructure to defend a brand's very identity in the digital realm. This partnership is a clear indicator that for global brands, investing in AI-driven protection is becoming as essential as the products they sell.