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Dupe influencers exploiting social media to peddle luxury fakes
Dupe--slang for duplicate--influencers are individuals who persuade buyers to purchase counterfeits using social media platforms to drive a brand message intended to confer legitimacy on the purchase decision. Dupe influencers sell fake luxury goods online to their cadres of followers, who relate to the influencers' fashion savviness and who trust their judgment of products' quality. In this article, I provide a synopsis of a case Amazon settled against two dupe influencers who used social media to promote the sale of counterfeit luxury products. I highlight the persistent challenge of luxury counterfeits sold online, the consumer complicity of obtaining luxury fakes, and the problem of discerning a knockoff from a counterfeit product. Dupe influencers leverage trust with their followers and use social media tactics, such as unboxing videos and designer haul promotions, to peddle luxury fakes. Recommendations to combat dupe influencers center on monitoring and working with e-commerce platforms to shut down social media posts that infringe a company's intellectual property, raising consumer awareness of the illicit activities of counterfeiters through education campaigns, leveraging legitimate social influencers to debunk the dupe influencers, and pursuing legal remedies. -
Resolving the Jeopardies of Consumer Demand: Revisiting Demarketing Concepts
Demarketing is a way for managers to cope with excess and/or undesirable demand for their products or services. In this article, we revisit the original framework and modify the classification scheme of demarketing concepts introduced by Kotler and Levy to reflect more contemporary issues. Previously, general demarketing topics addressed ways to curb excess demand due to temporary shortages, chronic overpopularity, and product elimination-all from a microenvironmental perspective.Herein, we add macroenvironmental concepts of protective demarketing and preventive demarketing. Formerly, selective demarketing addressed either undesirable or unprofitable consumption of the legitimate product/service; today, however, many firms across several sectors are fighting against the undesirable consumption of illegitimate products/services, such as pirated and counterfeit goods. We thus introduce the notion of combative demarketing. We conducted personal interviews with several industry experts to provide insight regarding current demarketing tools. Our discussions highlighted various measures that managers can employ to manage consumer demand, including using smaller packaging to reduce sugar/fat content, increasing the price of water, limiting visitor access to national parks, and educating consumers to identify counterfeit goods. -
The Looming Shadow of Illicit Trade on the Internet
Pirates on the virtual sea are supplying their illicit digital content and goods through cyberlockers and darknet markets. The deep web hosts darknet marketplaces selling a variety of wares, such as narcotics and weapons, and is testimony to the growth of illicit trade on the internet. The challenge of web sites that host digital content piracy is exacerbated through linkages to a variety of malware schemes that have created a lucrative crimeware economy. Digital thieves target unsuspecting consumers as digital bait to derive profits from a variety of malware schemes such as ransomware and malvertising. The hijacking of access to computers and their digital content in order to ransom them back to consumers or organizations is considered to be one of the leading threats of internet crime. Malvertising schemes are plaguing the internet advertising business-criminals are reaping profits by posting legitimate advertisements at content theft sites or using an army of botnets to fake advertising traffic. A variety of stratagems are evolving to curb this illicit trade, including fostering multi-lateral enforcement tactics, updating legislation to circumvent this type of crime on the internet, training digital savvy citizens, and creating private-sector remedies. -
The Challenge of Curbing Counterfeit Prescription Drug Growth: Preventing the Perfect Storm
The recent case of fake Avastin1 brought the problem of counterfeit pharmaceuticals to the forefront of illicit trade. Drug counterfeiters are opportunistic criminals motivated by the windfall profits that are realized from selling fake pharmaceuticals with limited legal penalties. This article describes the interrelated trends that may trigger a catastrophic situation of counterfeit drugs infiltrating the global pharmaceutical supply chain--a 'perfect storm.' We discuss the failure of policymakers to note the early warning signs and the ease of penetrating the pharmaceutical supply chain--both physically and virtually--by an array of illicit traders, ranging from small cottage operations to full-scale manufacturing facilities; the recent U.S. legislation enacted to curb growth in counterfeit pharmaceuticals; and the proliferation of national, multilateral, and industry-led agencies to protect the prescription drug supply chain. Finally, we conclude with an analysis of anticounterfeiting tactics (e.g., consumer education campaigns, authentication technology) developed by various stakeholders. -
Country Matters: Executives Weigh In on the Causes and Counter Measures of Counterfeit Trade
In this article, we present the findings of a study examining the exploding problem of counterfeit trade via the opinions of U.S. executives as compared to their counterparts from Australia, New Zealand, South Africa, and Tahiti. Their responses provide insight as to how companies in different countries are attacking piracy and consumer complicity with counterfeit products. Per our study, executives in Australia, Tahiti, and the U.S. had similar perspectives: they viewed the seller as the main driver of counterfeit trade for reasons of profit. These executives perceived the demand for counterfeits as being driven by desirable product attributes and the ease of obtaining them. Likewise, they cited two anti-counterfeiting actions-site licenses and reduced price/rebates-as being able to reduce the demand for illicit products. In contrast, South African executives observed the main reason for piracy as weak enforcement of intellectual property (IP) and the lure of exorbitant profits, with little value in any anti-counterfeiting actions other than special packaging. These executives put forth that South African consumers are complicit due to limited education and low disposable income, and the ready availability of counterfeits. Executives from New Zealand were the most optimistic, believing that piracy and complicity can be reduced by many anti-counterfeiting actions, including special packaging, reducing price, emphasizing product benefits/warranties, stressing the harmful effects of using fake products, offering site licenses, and listing of authorized sellers. -
Preserving Intellectual Property Rights: Managerial Insight into the Escalating Counterfeit Market Quandary
The U.S. Customs and Border Protection reports that counterfeit goods seizures were up 83% in 2006. While a plethora of anti-counterfeiting strategies target distribution channels, international organizations, pirates, and company-based initiatives, few reports debate the effectiveness of these distinct anti-counterfeiting tactics to curb the problem. For this study we conducted in-depth interviews with United States managers to gauge the efficacy of various anti-counterfeiting tactics to preserve intellectual property rights. The results indicate that corporate managers find the practice of encouraging distributors to notify the manufacturer about counterfeits, as well as educating both employees and channel members about the counterfeit problem, to be some of the most effective ways to fight pirates. However, the managers report many other tactics are futile, including providing financial incentives for distributors to reject counterfeits and stressing the harmful effects of fake goods in advertising. We recommend a specific program that firms can employ to deter counterfeiting, including managing the registration of all trademarks and patents in key markets, establishing a company-based enforcement team, monitoring the growth of fakes through a central information repository, developing a multi-pronged action plan, and preparing to fight pirates through investigative work in conjunction with local law enforcement. -
Changing Levels of Intellectual Property Rights Protection for Global Firms: A Synopsis of Recent U.S. and E.U. Trade Enforcement Strategies
According to the International Anti-Counterfeiting Coalition (IACC), approximately $350 billion in counterfeit goods is traded annually in the world economy. Additionally, the European Commission of Taxation and Customs Union reported that 100 million fake items were seized in 2004, a 900% increase over a four-year period. Recent trade initiatives, such as the U.S. Strategy Targeting Organized Piracy (STOP!) and the EU Intellectual Property Rights Enforcement Directive, target both organized pirates and consumers in an effort to bolster the protection of intellectual property rights. Understanding these innovative trade initiatives will assist managers to better deal with anti-counterfeiting tactics.