Cybersquatting: what is it and how can it affect your brand?

Briefly, we can say that cybersquatting is the malicious practice of registering domain names that use third-party brands, with the purpose of making a profit, diverting traffic, or damaging a company's reputation.

This is one of the fastest growing digital threats and, here at Branddi, we thoroughly understand its impacts, as combating it is part of our daily lives.

This tactic may seem distant, but its consequences are direct and can generate anything from significant financial losses to irreparable damage to the trust that your clients place in you.

We invite you to continue reading to discover how this practice works, the real risks it represents for your business and, above all, what are the most effective strategies to protect your most valuable asset: your brand!

What is cybersquatting?

To understand cybersquatting, think of it as a kind of “land grabbing” in the digital world. In other words, directly, it is the practice of a person or company registering a domain name on the internet that is identical or very similar to that of an established brand, without having any right over it.

The purpose of the cybersquatter (the offender) almost always involves bad faith, and can vary between:

• Sell the domain: attempt to sell the electronic address to the brand owner for an inflated amount;
• Fun traffic: direct your brand's customers to a competing site or a page with ads;
• Apply blows: create a fake site to sell pirated products;
• Tarnish reputation: use the domain to publish negative content about your business.

The practice is so widespread that there are international mechanisms, such as the Uniform Domain Name Dispute Resolution Policy (UDRP), created specifically to resolve these conflicts more quickly than a traditional judicial process.

How does cybersquatting work?

The operation of cybersquatting is dangerously simple and takes advantage of the speed of the digital environment.

The process generally takes place in three clear steps:

• Target identification: The offender monitors the market for opportunities. It could be a rising brand, the launch of a new product, or a company that hasn't registered variations of its domain (such as .net, .shop, or versions with typos);
• Quick registration: with a low investment and within a few minutes, Cybersquatter registers the desired domain. The registration system operates on a “first come, first served” basis, which facilitates this action;
• Monetization and attack: With the domain in hand, the malicious intent comes to fruition. The most common tactics here include selling the domain to the brand for an exorbitant price, setting up a Fake site to carry out scams or sell pirated products, capture traffic by typing error (Typosquatting), or simply park the domain with advertisements to profit from the clicks.

It is no accident that the number of domain disputes, such as those managed by UDRP, is growing every year, already exceeding the mark of 6,000 annual cases globally, according to data from World Intellectual Property Organization (WIPO).

Remember: simplicity and low cost make cybersquatting a Accessible and Constant Threat.

What are the main types of cybersquatting?

The creativity of scammers is vast, and cybersquatting is not a single tactic, but rather an arsenal of strategies designed to deceive, steal, and harm. To do this, each method exploits a different vulnerability, whether it's a simple user type or the trust placed in major brands.

Therefore, knowing the main variations of this threat is the first step in building a solid defense.

Below, we detail the most common modalities that we monitor and combat on a daily basis.

Typosquatting

This is perhaps the most well-known form of cybersquatting. The tactic consists of registering misspelled domains of famous brands, betting on human error to capture traffic.

But the strategy goes beyond the typo: the choice of domain termination (TLD) is also calculated.

According to the report ThreatLabz 2024, 39.4% of malicious domains use the.com ending to appear more trustworthy.

At the same time, scammers exploit low-cost endings such as .xyz (11.1%) and .top (5.4%) to register a large volume of domains and scale up their attacks.

Homographs (or homoglyphs)

Here the change is visual and much more subtle. The attack with homographs uses characters from other alphabets (such as Cyrillic) that are visually identical to those of the Latin alphabet.

For example, the domain apple.com can be faked using a Cyrillic “a” (a.pple.com), which to the human eye is indistinguishable. The browser, however, interprets it as a completely different address.

This tactic is extremely dangerous because even attentive users can be deceived, making phishing sites created with this technique very effective.

Squatting combo

In Combosquatting, the scammer combines the name of a legitimate brand with keywords that convey urgency or trust. They register domains such as support-netflix.com, login-banco-br.net, or promo-amazon.shop.

The tactic aims to make the user believe they are on an official support, login, or promotion page for the brand.

It is a form of social engineering that exploits customer trust in the original brand to direct them to fake sites, being one of the main gateways to Phishing scams.

Soundsquatting

With the popularization of voice assistants like Siri and Alexa, Soundsquatting emerged.

This technique consists of registering domains that have a pronunciation similar to that of famous brands, but with different spellings.

For example, a scammer could register naik.com to capture users who said “Nike” and were misunderstood by technology.

This new attack front appears in a scenario where phishing continues to grow: according to ThreatLabz Phishing Report 2024, attacks increased 58.2% in just one year, driven by new technologies and tactics.

Name Jacking

Name Jacking is the opportunistic practice of registering domains related to the name of a person, product, or event that gained sudden notoriety.

The logic is the same as that used against large corporations: attacking highly trusted and relevant names.

The proof is in the numbers: data from the report ThreatLabz 2024 show that only three giants - Google (28.8%), Microsoft (23.6%) and Amazon (22.3%) - account for 74.7% of all phishing domains that exploit reputation and typos, as this is where the financial return for criminals is greatest.

How does cybersquatting impact brands?

The impacts of cybersquatting go far beyond the hassle of having an improperly registered domain. After all, this malicious practice hits the heart of the business, causing losses on multiple fronts: from the hard-built reputation to the financial security and trust of its clients.

And understanding the extent of these damages is the first step in justifying brand protection as a strategic priority, and not just an expense.

Shall we go?

Damage to reputation

When a criminal uses your brand name to carry out a scam, the damage is immediate, even if your company is not at fault.

And that's what a global survey by Callsign, released by YOU INSIDE, which revealed an alarming fact: the simple fact of receiving a false message impersonating a brand is sufficient for 57.8% of Brazilian consumers to lose trust in it.

This means that even before a customer falls for the scam, their reputation is already being eroded by the actions of the scammers.

Financial losses

The impact on the cashier is immediate and multifaceted. And financial losses come from several directions:

• Diverted direct sales: customers who buy on piracy sites or from scammers who impersonate your brand;
• Inflated marketing costs: competitors and scammers who bid on their brand keywords (brand bidding), increasing your Cost per Click (CPC);
• Support expenses: increase in the volume of complaints, chargeback requests, and staff hours to manage crises with injured clients.

Loss of public trust

Trust is one of a brand's most valuable assets, and cybersquatting destroys it. After all, the modern consumer expects companies to protect their digital environment.

The research carried out by Branddi In 2025 it's clear: 88% of consumers consider investment in protection against scams to be a positive differential for loyalty. In addition, 58% point to trust in the brand as one of the main factors for the purchase decision.

Remember: when the brand doesn't act, it not only loses a customer, but also the trust that would take years to rebuild.

Legal and operational costs

Tackling cybersquatting on your own generates significant costs. That's because the process involves legal expenses to initiate a dispute (such as a UDRP process), in addition to countless hours of work by legal, marketing, and IT teams to identify threats, document violations, and follow up on each case.

That is, those resources, which could be invested in business growth, end up being drained to put out fires, making the operation more expensive and less efficient.

Reduction in traffic and visibility

Cybersquatting domains are used for Steal Your Clicks and your online visibility. To do this, they can appear in Google search results (SEO) or, even more aggressively, be used in paid advertisements (PPC) that appear above your own sponsored links.

This practice, known as brand bidding, diverts qualified customers who were actively searching for you, directly impacting your marketing metrics and return on ad investment.

Increased vulnerability to scams

A cybersquatting domain is rarely an end in itself; it's a tool for Bigger Blows. As a result, it becomes the landing page for phishing emails, fake ads on social networks, and malicious links in WhatsApp groups.

By allowing these domains to exist, your brand unintentionally becomes a vector for your customers to be exposed to more scams, increasing the perception that interacting with your company in the digital environment is risky.

How to protect your brand against cybersquatting?

Shielding your brand against cybersquatting is not a single action, but an ongoing and strategic process. After all, threats emerge on a daily basis, and an effective defense requires a multi-layered approach.

Here at Branddi, we not only understand the risks, but we actively combat them for hundreds of companies. And based on our experience, we've compiled the essential pillars to protect your most valuable asset.

Below, we detail the step by step to transform your brand into a digital fortress, capable of anticipating and neutralizing threats before they cause harm.

Register your trademark with the INPI and with international bodies

The official registration of your trademark is the foundation of your entire protection strategy. Without it, you don't have the legal basis to combat the misuse of your name.

In Brazil, the process begins at the National Institute of Industrial Property (INPI), guaranteeing your rights in the national territory. However, for wider protection, it is essential to extend the registration to international bodies, such as the WIPO (World Intellectual Property Organization), especially if your brand operates or intends to operate in other countries.

The basic step by step includes the feasibility survey, the submission of the application, and the monitoring of the process.

Continuously monitor your brand usage online

Trademark registration is the first step, but real protection happens on a daily basis. After all, scammers act fast, registering domains, creating fake profiles, and launching fraudulent ads in a matter of hours. For this reason, continuous monitoring is indispensable.

And the scale of the problem is massive: data from Serasa Experian Point out that, in November 2023 alone, more than 26,000 attempts at such scams were registered per day in Brazil.

Given this volume, manual surveillance is impossible: it is necessary to use technology to track mentions of your brand on domains, social networks, marketplaces, and advertisements, allowing for the identification and rapid removal of threats before they cause major damage.

Count on specialized partners

The fight against cybersquatting requires technical and legal knowledge and a deep understanding of the policies of dozens of digital platforms. Therefore, trying to manage this process internally drains valuable resources and distracts your team from focusing on what they do best: growing the business.

And specialized partners like Branddi exist for that. After all, they combine cutting-edge technology for monitoring at scale with human expertise to execute takedown actions quickly and effectively.

This approach not only guarantees better results in removing threats, but it also frees your team to focus on their core activities, turning brand protection into a strategic investment with clear returns.

Don't let cybersquatting steal your results!

Now you understand what cybersquatting is, its different types, and the damage it can cause to your revenue and reputation.

The good news is that you don't have to face this battle alone: at Branddi, we transform the defense of your brand into an intelligence operation, combining the power of Artificial Intelligence with the work of dedicated specialists.

All this through our platform that monitors the internet 24/7 for any misuse of your name, from the registration of fake domains to advertisements that practice unfair competition.

That way, when a threat is detected, our team takes action to quickly neutralize it.

And the results are concrete: we have already identified and taken down more than 50,000 fake domains, recovering revenues and protecting the trust of millions of consumers for more than 300 brands around the world.

Don't wait for a scam to affect your customers to start taking action: your brand is your greatest asset, and protecting it is a strategic investment.

Visit our website, learn about our solutions, and move toward the future of brand protection with Shielding marketing!