So, why are counterfeit products such a big deal? I understand that many people might be thinking; “how different can products be if they look the same? People buy knock off Gucci bags and Goose jackets all the time. “So what if it isn’t the real deal, people save a lot of money, and the look and function just fine.” Sure, an unraveling stitch on a bag or jacket that you knew beforehand was counterfeit is one thing, but is that all of the dangers of a product such as that? What about the products or components that you DON’T know are counterfeit.
Counterfeiting is a 700 billion dollar industry and is being recognized globally as a dangerous economic problem. There is a good chance that the counterfeit item you purchased is helping the production of other counterfeit products or even organized crime. Counterfeiting goes way beyond fashion, it is in every category of product, no matter how real and safe you may think they are. There are counterfeit products in electronics, architecture, motor vehicles, aviation, military, medicine, and the list doesn’t stop there. Counterfeit products can have major safety issues.
Counterfeit electronics aren’t just that iPhone that you bought that broke in 1 month, or that high end PC, at a fraction of its original price that you just couldn’t resist, they are also components, electronic parts that you don’t know about. The rising numbers of counterfeit electronic parts in the supply chain costs the Canadian and US government billions of dollars each year, but the problem is not limited to government agencies. Consumer and Industrial businesses are losing approximately a quarter of a billion dollars each year because of counterfeit components. In addition, these counterfeit components are creating ...
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... brand name, and profit off the goodwill and recognition that the brand has built up. This can quickly cause irreparable damage to the brand and the brand’s reputation. The competition between the brand and the counterfeit product leads to more resources being spent on counterfeit detection methods that go directly to prices the consumer pays.
Counterfeit products don’t only effect businesses. They affect everyone, robbing Governments, and even society, of tax revenue, income, and jobs. The flood of counterfeit and pirated products create drain on the economy that deprives the government of tax revenue for essential public services and puts a greater burden on the taxpayer. The competition between the authentic product and the counterfeited product means is killing the western manufacturing, and putting at risk the towns that rely on manufacturing jobs for income.
Companies realize what people need and they take it as sources to produce commodities. However, companies which have famous brands try to get people’s attention by developing their products. Because there are several options available of commodities, people might be in a dilemma to choose what product they looking for. In fact, that dilemma is not real, it is just what people want. That is what Steve McKevitt claims in his article “Everything Now”. When people go shopping there are limitless choices of one product made by different companies, all choices of this product basically do the same thing, but what makes them different is the brand’s name. Companies with brands are trying to get their consumers by presenting their commodities in ways which let people feel impressed, and that are some things they need to buy. This is what Anne Norton discussed in her article “The Signs of Shopping”. People are often deceived by some famous brands, which they will buy as useless commodities to feel they are distinctive.
Secondly luxury products are easy to counterfeit, some countries such as china, turkey, and other still have to improve their IPR policies
When products are “killing machines”, we should tighten measures to keep them away from criminals.
Copyright infringement and fake products are causing both financial and brand recognition issues for big manufacturers, because of the low quality that makes the actual product look un useful.
Consumer attitudes are influenced by social pressure which is inclusive of informative and normative susceptibility (Ang, et al., 2001; Bearden, Netemeyer, & Teel, 1989; Wang, Zhang, & Ouyang, 2005). Normative consumers are more concerned with impressing others and ensuring that their behaviors are based on the expectations of others. Since counterfeiting is an unethical and illegal activity and involvement in such an activity does not project a positive image, therefore normative consumers would have negative attitude towards counterfeit products (Ang, et al., 2001; Lord, Lee, & Choong, 2001; Penz
Political/Legal: A company’s brand image may be the single most important thing when it comes to the company. Each and everyday a lot of money is spent on making sure that image isn’t tarnished, infringed on by illegal activities. Every year it is estimated that there is 300 billion dollars in sales of counterfeit goods. Also as markets continue to grow, relationships can change effecting for example tariffs.
Wars, complete with spies and lawyers masquerading as foot soldiers, rage ceaselessly in American homes. Some are as foreign as Samsung and Apple’s technology infringements, making headlines with fines and court declarations. Others deliver mail warnings against infringement for tracked, pirated media. But a more widespread and unnoticed battle grips the fields, supermarkets, and kitchens of America.
Hasbro faces a significant threat from counterfeits of its products. As the market for toys and games is increasing globally, the parallel market for counterfeit toys is also on the rise. Such activity rises especially during the festive months when toy sales are expected to be high. Counterfeits pose a threat to the toys and games market, not just in terms of lost business and brand dilution, but also by selling products that can be potentially dangerous to children of all ages. Low quality counterfeits reduce consumer confidence in branded products like Hasbro. Counterfeits not only deprive revenues for the company but also dilute its brand image.
A quick research of the AliExpress export website shown a list of 50 companies producing interlocking brick toy with probably 25 companies were doing toy similar LEGO type. Those manufacturers based in Chenghai that is core producer for world reputation toy company like Mattel and Hasbro as well. According the huge demands of valuable box sets produced by LEGO, especially some product line featured licensing animation like Marvel and DC comics super hero. Due to the related movies were keep released in these 5 years, it brings the big noise from market which customers are fascinating with those super hero box sets and it could be higher return investment tools than investment in gold. Therefore, many illegal businessmen of brand like Decool and Coko were targeting this specified customer needs and proceeded mass production regarding this reason. However, infringing patent products were sold in much cheaper price than LEGO and Mega Bloks offer, but they can gain the higher profit also. According this finding, we could see this pattern have been copied by many other China manufacturers. It further leads the vicious circle of plagiaristic toy issue in toy industry even same case happened in other industry like luxury
When comparing prices, consumers can find the exact same style Nike boot in Adidas and pay a lower price. Essentially what the consumer is paying extra for is the Nike brand. Looking back at my journal you can see I wore the Adidas boots one time, then went out and bought Nike boots. “Brand loyalty is based on an emotional connection toward the brand and a conscious commitment to find this brand each time the consumer purchases from this category.” 112 Brand Promotion I could have worn the Adidas boots for free but I spent the time and money to go purchase the Nike brand. “brand loyalty and advertising work together to create another important economic effect related to pricing flexibility and profits. When consumers are brand loyal, they are generally less sensitive to price increases for the brand.” 45 Advertising and Integrated Brand Promotion Being able to raise prices but still keep the consumer market is very valuable. This is one of the main reasons brands strive to have brand loyal
Are items created for profit physically any different from their “authentic” counterparts? At an atomic level, perhaps, but the untrained eyes of most tourists would probably not find any dissimilarities between a mass-produced mask and a more “authentic” one. Yet we as a society treat economically motivated primitive art as different from the primitive art actually used in rituals, which indicates that economic motivations can definitely influence our perceptions of art. This realization still brings us back to the question posed in the last paragraph, however: why would people treat Renaissance art as valuable and advertising as beneath their notice if both have economic motivations behind their
2006). Burberry’s product line, especially the famous trademark plaid, unfortunately, is not difficult to imitate, the development of “fake Burberry” affects their revenue. In 2010, Burberry won $1.5 million in counterfeit case (Matthew 2010), but the counterfeit apparel and accessories is still the key issue for all major luxury brand (Maman 2012).
Over the years counterfeiting and piracy has have a negative effect on employment. According to the AFP (Australian Federal Police) the Annual loss of jobs were 100,000 in the EU due to Counterfeiting and 750000 jobs in the United States. The tremendous loss of jobs is increasing rapidly over time which is consequently affecting the world economy. There are a number of reasons as to why this is happening. The first reason has to do with companies and businesses losing revenue which in turn affect employment. These businesses and companies lose revenue due to the counterfeiting of their product. When infringement parties make the counterfeit goods, consumers will most likely be attracted to buying these goods because most likely it would be selling at a much lower price compared to the original. This therefore decreases the demand for this product and therefore means that some of the market shares are being lost from the company. According to an article in the Pacific Business Review International, 25% of market shares are lost due to counterfeiting and piracy in India. Due to the fact that companies lose revenue, this means that they might not be able to maintain the current workforce that they currently posses. This would result in companies cutting jobs and possibly completely eliminating job positions all together. Approximately 2.5 million jobs have
to use their money at a local Taco Bell. If teenagers are finding ways to
Reviewing the existing literature on this topic, this essay attempts to look at the scale of counterfeiting, the reasons for its growth and the consumer’s attitudes towards counterfeited products. It also provides information about how the counterfeit market poses challenges for customer-brand relations and the strategies that brands can implement to overcome these challenges.