Good Counterfeit

Is imitation really the best form of flattery? Well, I think it depends. Of course, those with a vested interest in protecting intellectual property may feel a certain way, but what if there were some potential benefits? Copyright and trademark laws have become much harder to enforce in the digital age. From screenshotting, streaming and downloading, the internet is a breeding ground for ease and access when it comes to these violations. Since we are learning the difference between the two in media law right now, I think my professor would be remiss if I didn’t take the opportunity to explain the difference. Copyrights protect original artistic works, such as photos, books, movies, songs, paintings, software code, etc. With these rights, the owner can reproduce and profit off the underlying work. A trademark protects a word, phrase or symbol used in commerce to identify and distinguish one product from another. Trademarks help businesses and the public by making the differences between products clear such as a slogan, brand name or logo.

Going back to the fashion frauds, a scene in House of Gucci got me thinking about this topic. The scene goes like this:

Patrizia: “Who is making this stuff? Who is allowing this to happen?”

Aldo Gucci: “As far as fakes go, they are pretty good. I mean I’d buy them. […] Quality is for the rich. If a Long Island housewife wants to live with the illusion that she’s a Gucci customer, why not let her?”

Another line also talks about quality and price when Aldo Gucci says:

“Patrizia, you should know, that the Guccis were noble saddle-makers to medieval courts. We have history flowing through these green and red webbings. And, yes, we are expensive. But quality is remembered long after price is forgotten”.

Quality is remembered long after the price; you may not know what you paid for something, but if it lasts, it means something. Sadly, price is not forgotten fast enough. Yes, brands lose a substantial amount of money to counterfeit goods and take extreme measures to prevent this, but is it useful for their value proposition that they are among those getting copied? It seems like the fashion fakes further prove the value proposition of these brands. People want to have them so bad they are willing to try and make a dupe. The movie was criticized for certain fictional elements including the dramatization of Aldo letting people get away with making fake or knock-off Gucci items. Aldo did not accept the knock-off Gucci purses as nonchalantly in real life as the film made it seem. According to TheWrap, Aldo instead actually said to New York Magazine, “Why should a woman see an expensive handbag she has just purchased copied all over three months later?”

Fakes are walking advertisements, and sometimes it is hard to tell the difference from far away. Other times, with the outsourcing of factories, it is the same manufacturer just with a lesser cost-cutting out the middle man. There is even something called the gray market; this is where a product was not supposed to be sold in your region, but the manufacturer sells it anyway. The more saturated the market is with your product, the more sales you could potentially see because of that “I have to have it because everyone has it” mentality. The only argument against this is the former Abercrombie and Fitch business model; they only wanted certain people to represent their brand and wear their clothes.

For the consumer, these counterfeit products can be positive. The fakes make the brand want to have distinguishing factors in setting them apart from those trying to copy them, whether it be new ideas or better quality. It is incredibly easy to copy a logo; however, it should be difficult to manufacture the same goods with extreme price differences because they should be more expensive to produce. If the value is inflated because of the brand identity, nothing sets them apart from the fraudulent items. If you ask people who collect sneakers what one of the biggest giveaways is when it comes to dupes, they will say the smell. The manufacturers of counterfeit goods are not worried about preserving the brand reputation; they are trying to cut costs at all costs. On the other hand, these luxury brands were created on ideas of traditional craftsmanship, handmade components and heritage. This gives these companies an incentive to create new or change existing items and produce high-quality products so those copying them cannot keep up. For luxury brands to truly fight counterfeit goods and make fakes less attractive to those who can afford the product, they need to emphasize a style and quality that one cannot replicate and does not inherently rely on the brand logo.

How big is the counterfeit industry? The Harvard Business Review reported in 2019 that “the total trade in fakes is estimated at around $4.5 trillion, and fake luxury merchandise accounts for 60% to 70% of that amount, ahead of pharmaceuticals and entertainment products and representing perhaps a quarter of the estimated $1.2 trillion total trade in luxury goods”. According to a 2019 report by the OECD and the EU’s Intellectual Property Office, “trade in counterfeit and pirated goods has risen steadily in the last few years – even as overall trade volumes stagnated – and now stands at 3.3% of global trade”. The goods making up the largest share of the total percentage seized included footwear (22%), clothing (18%), leather goods (13%), watches (7%), perfumes and cosmetics (5%) and jewelry (2%). These categories overlap with various luxury brands that are losing revenue because of it. But, one could argue that pirated products are actually an indicator of the brand’s health and its prevailing market reputation. Does this mean I condone copyright and trademark violations? Absolutely not. However, I think that these violations will continue to persist as it becomes harder and harder to police brands. If a brand is counterfeited more, it only means that it is capable enough to stimulate the consumer’s interest and create demand.