While imitation might be the sincerest form of flattery, it can be devastating to a beauty brand with a genuinely unique, game-changing idea. 

Just ask Ryan Margolin, CEO and co-founder of Professional Hair Labs, which markets the much-imitated GHOSTBOND, a toxin-free, water-based wig adhesive. Developed by Margolin’s father after Margolin’s mother—a master technician and expert in hair replacement developed career-ending chemical poisoning—it launched in 2010 and marked a new era for the 30-year-old, Ireland-based company.

“The industry was full of toxic products,” Margolin recalls of the pre-GHOSTBOND days. “A lot of the adhesives were formulated with solvents such as xylene, toluene, and hexane, which ultimately are derivatives of gasoline. So, my dad wanted to formulate a water-based solution that was safe.”

After deciding to commit to the family business just as GHOSTBOND was getting off the ground, Margolin built a spreadsheet of all the hair replacement studios in the US and helped develop a simple, two-sided postcard mailer. 

The phone started ringing after that direct mailer went out, and the ascent was steady. “We’d get phone calls ordering a bottle to try,” says Margolin. “And after four weeks, we’d get the feedback and an order for two to three bottles,” which invariably climbed to up to 25 bottles per client and a tripling in revenue in the 18 months after the innovative product’s debut. 

“We started to grow exponentially,” says Margolin. “From 2015 to 2019, we went from a company doing about $1.1 million a year to over $10 million in sales.” 

Unfortunately, egregiously formulated copycat products started to surface on major global digital marketplaces during that same timeframe. 

“I saw the first listing of counterfeits in, I think, 2018 on Alibaba,” says Margolin. “And because I was so inexperienced about what it actually meant at the time, I was a bit overemotional about it. The simple concept of someone replicating a product that was developed because your own family member was sick due to chemicals … you see this product being copied, and it brings back all those memories.”

Quickly realizing he needed to take emotion out of the equation, Margolin had no choice but to start developing a systematic approach to stem the counterfeit tide. “That one listing turned into three listings, which turned into 10,” he says. “Before we knew it, in the space of two years, there were thousands of listings of counterfeits across the globe.”

To his horror, the GHOSTBOND counterfeits Margolin purchased for inspection were essentially wood glue. Even worse, some were filled with pesticides. No wonder these rock-bottom imitations of a safe-for-skin product that was meticulously crafted under the strictest ISO (International Standardization Organization) guidelines were going for 90 cents a bottle.

While GHOSTBOND is sold strictly B2B, mega-marketplaces like Alibaba and AliExpress were selling directly to the consumer, creating an even bigger problem for Professional Hair Labs. 

“We very quickly realized we were let down by our original attorneys, on the IP end,” Margolin recalls. While the company owned the GHOSTBOND trademarks in the US and Canada, they were unprotected elsewhere. “We didn’t have our trademark in China, and someone trademarked the name there before we got to it.”

What ensued was a years-long “game of cat and mouse” that entailed sending undercover investigators into China to meet with the owner of the GHOSTBOND trademark to capture a conversation in which the perpetrator offered to sell it back to Professional Hair Labs for $50,000. 

Although it would have been far quicker for Professional Hair Labs to just fork over the $50,000 to obtain the China trademark for GHOSTBOND, Margolin and his team opted to go to the Chinese trademark authority and demonstrate that the previous owner had acquired it in bad faith. 

Five years later, in 2023, Professional Hair Labs gained possession of the GHOSTBOND trademark in China. “It’s nuts to think we’ve been going through this for so long,” Margolin concedes. “But I have to say that when we got that trademark, it was like a breath of fresh air. We knew we had the ammo to go do what we needed to do.”

That “ammo,” as Margolin puts it, includes not only the development of proprietary tracking software called Clarity Codes, but also working closely with law enforcement all the way up the food chain to the Department of Homeland Security. The latter approach has already yielded three successful lawsuits against counterfeiters, with another 30 pending. 

“We’re on the cusp of sending a big message to the [counterfeit] industry,” Margolin promises, adding that Professional Hair Labs is “pretty confident” in their intel about scores of perpetrators. “But then again, they’re insanely clever about what they do and how they do it, and they know how to not get caught.”

Fortunately, Professional Hair Labs, which loses north of $5 million in annual profits due to counterfeiting, has the resources to keep the legal fight going. Additionally, the company has allocated funds to product replacement programs for brick-and-mortar stores and hair replacement studios that may have inadvertently purchased counterfeit goods. 

“We don’t want to sue people,” Margolin notes. “We don’t want to go after people. But when you show that you’ve been scheming, and you’ve put your foot out there to diminish, or tarnish, or harm our brand, in my eyes you don’t deserve anything else.”

And despite all the drama and trauma, Margolin is happy to have disciplined himself to take the emotion out of the counterfeit equation. “At this point,” he says, “it’s now just another day at the office.”