Yet Another Study Says Counterfeit Products Aren't Really A Problem

from the let-it-go dept

Last year, we wrote about a fascinating study that indicated that counterfeit goods very often are not a problem for the manufacturers of the legitimate goods. That was because the study found two things: (1) most consumers buying counterfeit goods weren't being "tricked." They knew they were buying counterfeit goods, and it actually created a lower entry point into the market; (2) as such, it actually acted as really good advertising. The study found that 46% of those who bought a counterfeit brand-name purse, went and bought the real thing within two and a half years. That came on the heels of a variety of studies and reports that showed that the claims from the industry about the supposed "harm" from counterfeiting wasn't just overblown, but were blown so far out of proportion as to be ridiculous (though, politicians and reporters seem to have no trouble repeating such claims regularly).

It looks like we've got yet another study highlighting exactly the same thing -- and this one coming from a guy who is an advisor to the UK government. Gautam John points us to this new bit of research by Professor David Wall which was funded by the EU, which found that counterfeiting isn't really that big of a problem. The findings were quite similar to the study we reported on last year. It says that there's a consumer benefit to buying knockoff designer goods, and that the "losses" claimed by companies are way out of line with reality. Furthermore, perhaps most surprisingly, the report says that law enforcement should not waste their time trying to stop the bootleggers. The report also debunks the popular claim from the industry that counterfeit goods fund terrorism and organized crime.

Now, the report focuses on designer goods -- and notes that there is a real concern about potentially counterfeit pharmaceuticals (though, the industry often tries to lump generics in with counterfeits) and things like fake airplane parts. But this has always been the problem with attempts at lumping together all of these things. The actual "harm" is very different depending on what kind of products you're talking about. The designer goods industry -- and the copyright industries -- have been trying to lump themselves in with things like fake drugs, to try to get everyone worked up in their favor.

So it's nice to see a report like this specifically break it out and note that designer counterfeits aren't a problem. In fact, the report points out that problems of lumping all these things into one category: which is that law enforcement spends less time focusing on the things that really can create harm (fake drugs and airplane parts and such) and is forced to go running after fake handbags that don't actually damage the market.

With various governments getting ready to finalize ACTA in a few weeks, isn't it... rather concerning that the entire basis of the agreement doesn't appear to hold much water?

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Separately, Bruce Ediger points us to a different study that tries to claim that people who have counterfeit goods are more prone to dishonesty, greed and cynicism. So, perhaps you can read into that a different kind of "harm" from counterfeit designer goods, though the design of the study itself seems a bit more suspect -- and even if you believe that study, that's never been the rationale for government action when it comes to counterfeiting.

Filed Under: counterfeits, designer brands