Counterfeit Branding - Representing True Globalisation!

From cigarettes to fashion accessories to food products to medicines, more than 50% of the global market are filled with counterfeited products. Do you realise that the Nike t-shirt that you are probably wearing right now may not even exist in the design portfolio of Nike Inc. It may have been produced by a small time designer who sits in the busy lanes of New Delhi in India and charges less than $1 to give you the swoosh in any colour, any form and any design as requested! A true form of 'customisation'.

Counterfeit branding in one way is the smartest way of doing business in the 21st century. Think about it. Large global corporations spend millions of dollars developing a brand and once the brand becomes popular, millions of businessmen on the other side of the world start thinking about the strategy to increase their product lines! In other words, people running the counterfeit market seem much more smarter than an investment banker. They do their business at the cost of large corporations.

Only in India, the "fakes" market is estimated to be worth more than $2 billion and it's growing by nearly 20% every year. With the weak execution of Intellectual Property Rights and the growing corruption, there is no doubt that very soon one may find himself driving a counterfeited car! If you think it won't happen to you, think again. There are nearly 128 'known versions' of Parachute Hair Oil, 113 of Fair & Lovely cream, 44 of Vicks VapoRub, and 38 of Clinic Plus Shampoo. The reasons they are so popular with counterfeiters is because they are money-spinning brands with wide appeal, easily reproduced and sold in the Indian market. The problem is manifest across all product categories throughout the country - medicines, FMCG products, cosmetics, foodstuffs, aerated soft drinks, liquor, watches, clothes and even currency . Consumers are often unaware that they buy products that resemble what they want. This is worrying companies because fake products often ride on the success of the original product, eating into sales, and, in some cases, harming the consumer. For counterfeiters, it is the easiest thing. Put a passable product into a tube, with markings that resemble the original and market it in rural, semi-urban areas, through promoters, agents and retailers willing to make a quick buck. For most, the con job is easy to carry through.

Consider the figures. Counterfeit products comprise $200 billion a year. Ironically, it is even endemic in countries such as China, which is known for flooding the world market with low-cost priced products. In China, losses from counterfeiting are estimated at approximately 20 per cent of total sales revenues for MNCs such as Procter & Gamble ($150 million), Nike ($70 million), Unilever ($24 million), Gillette ($20 million), Johnson & Johnson ($15 million) and $6 million for BestFoods. Most of the products copied are top-selling brands and consumers could be seriously affected while consuming low quality adulterated products, particularly in the food and drug categories. These are usually manufactured under unhygienic conditions and without proper technical supervision. According to a study conducted by AC Nielsen in India on 30 FMCG companies, eight out of every ten consumers who purchased pass-off products felt cheated and only knew after purchase that the product was a pass-off. Surprisingly, 42 per cent of all the consumers surveyed were aware of the existence of pass-off brands in the market and either saw them in shops, read about them in newspapers or saw them on TV. Though brands such as Pepsi and Coke in India have dropped prices substantially to make their products the flavour of the masses, spurious products still score because of poor consumer awareness. And fake product manufacturers reap windfalls because there are barely any input costs, no safety standards involved, excise or taxes paid.

It takes more than the vigilance of a trademark team to combat smart counterfeiters. Unfortunately, say sources, the cost of the battle is to be borne totally by such companies. According to one source, adopting tamper-proof packaging and hologramming practices are prohibitive exercises that will raise prices and repel the cost-sensitive Indian buyer. Hologramming can cost between $500,000 and $5 million! Ironically, higher prices can push customers to switch product loyalties better than the best ad campaigns. Despite the seriousness, almost all the companies are vague about the methods to educate consumers. They are shying away from aggressive methods, mainly because the Indian consumers' tendency has been to totally avoid the imitated product rather than determine whether it is authentic

SOMETHING TO SPICE YOU UP FURTHER

According to the Web site of De La Rue, a UK-based commercial security printer and papermaker involved in the production of over 150 national currencies and a wide range of security documents:

·Ten per cent of perfumes and cosmetics and 11 per cent of clothing and footwear bought by consumers are fakes.

·There are around 160 Web sites offering `genuine' Chanel products, despite the fact that Chanel doesn't sell any of its products on the Net.

·The US FDA recalled $7 million worth of intra-aortic pumps used during open-heart surgery after it discovered malfunctioning counterfeit parts in the devices.

·Counterfeit baby formula resulted in some babies developing rashes and seizures after imbibing.

·US investigators discovered that more than 600 helicopters sold to US civilians and NATO were equipped with counterfeit parts.

·Fake perfumes have been found to contain urine as a stabiliser.

·Each year in the UK, it is estimated that 4,100 jobs are lost because of counterfeiting - wrecking industries and draining funds which otherwise would have reached public services.

Although the whole issue may first appear to be a simple yet rampant case of copycatting, in fact it demonstrates that there is a real need for stricter protection laws of brands, enforcement of those laws, and harsher punishments for merchants and makers of counterfeit goods. But as far as knocking out counterfeiting completely is concerned, it'll never be gone and brands need to view counterfeit products just like any other competition. Indeed "Counterfeiting will always exist. It's the subculture of the business industry in the 21st century."

Gaurav Bahirvani Brand Development & PR Strategist. England, UK.

* Special thanks to Hindu Business Line.

---

Revealing the Roots: The Process of Building Brand

How is branding different than marketing?Branding is not so much... Read More

Jan Verhoeff: Brand Your Market

Marketing potential of any product is based on recognition and... Read More

9 Keys to an Effective Logo

The right logo, with the right characteristics, will boost your... Read More

Corporate Logo Design ? 6 Keys to Success

A corporate logo design should be highly instrumental in building... Read More

12 Ways to Reduce Postage

1. Never send a letter that weighs less than 30... Read More

Whats In A Name? When It Comes To Your Business, Plenty!

Q: How important is the name of a business? Should... Read More

Build Brand Identity - Brand Identity Guru

Successful Guru marketers have a secret weapon that they use... Read More

The Big-Pay Off -- Brand Value

Many CEOs and marketing directors find their time wasted evaluating... Read More

Positioning and Branding - Brand Identity Guru

Where is your brand positioned in the marketplace? How is... Read More

Creative Branding Increases Sales Through Company Recognition

The one thing that everyone has in common is that... Read More

Brand Building 101

Building your brand into a brand leader isn't easy. There... Read More

The Keys to a Great Logo

Logo, graphic, icon, logotype, typogram, logoform, image?call it what you... Read More

Why You? -- Professional Identity Branding

You can have first-rate products and services, but if you... Read More

The Importance of Branding - Can It Really Make a Difference?

As consumers, we don't really think about the importance of... Read More

Personal Branding: Characteristics of a Strong Personal Brand

How many times have you been at a networking function... Read More

Donald Trump On Branding - Brand Identity Guru

Love him or hate him, one thing is certain: Donald... Read More

The Secrets of Starting Business Successfully

Starting Business Secrets will help you to start your own... Read More

Do What Works

"Can you hear me now?"You'd be hard pressed to find... Read More

How Much Is A Great Business Logo Really Worth?

A great logo can help a business project a positive... Read More

Wealthiest 10% of Americans Name Top Quality Brands for 8 Products in New Survey

The seventh in a continuing series of twice-yearly surveys by... Read More

Three Brand Identity Myths That Will Bring Your Business Down

To begin, let's define "Brand Identity," which is the combination... Read More

The Art of Successful Branding

Branding: it's a term that carries great weight in the... Read More

Good Logos Make Great Sales Tools

Every day, the average person is exposed to millions of... Read More

Build Customer Loyalty by Promoting Your Customers

Do you want to attract new customers while building greater... Read More

Importance of Business Branding

Branding is very important to a business, whether it is... Read More

Branding ? Brand Identity Guru

Brands are important aspects of any business, but unlike money... Read More

How To Create A Brand That Sticks

Most people, when they hear the word branding, think logos... Read More

John Deere and NASCAR; Excellent Use of Brand

We should all recognize the marketing efforts of John Deere... Read More

What is Private Franchising? It is Nothing Someone Made It Up

The Federal Trade Commission has an obligation to the general... Read More

Eye On The Pie: Branding From an Investors P.O.V.

When building a business as a brand it's important to... Read More

Light Up Necklaces Help Promote Red Doors Movie at the 2005 Tribeca Film Festival Awards

June 13, 2005 -- Jane Chen (Producer) of the Red... Read More

The Aim of the Name

Large corporations spend lavish amounts seeking names for their products... Read More

Why Branding?

Having a concise, clear image that you project to your... Read More