Counsel believe intellectual property practitioners will need to change their approach to educating the public about counterfeits after a new survey revealed “shocking” levels of apathy among some consumers.
Lawyers at watch maker Cluse, a cosmetics brand, a fashion retailer, and others say educating people on the dangers of fakes can only go so far and that counsel – or even others – should instead focus on the positive work of their brands to force a change in attitude.
However, others say there is still an opportunity to drum home the extent of counterfeiting’s links to organised crime and to play on people’s social conscience. This view comes despite the fact that the data suggests some consumers were unmoved by these concerns.
According to the data, published by US-based IP management company Anaqua, around a third of consumers surveyed admitted knowingly purchasing counterfeit goods. Many of these people were aware of the associated risks and links to criminal activity.
One source said the findings showed a “huge gap” in society between those who have concerns about the world they live in and those who don’t.
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Consumer apathy
Anaqua’s data was based on a survey of 1,000 US-based consumers.
Almost half (46%) admitted to purchasing counterfeit goods, with handbags, purses and wallets the most frequently bought items. Around 30% said they had knowingly purchased a counterfeit in the past.
However, of those who unknowingly bought a counterfeit, 48% said they would continue to use the product if they believed it served its function. Further, 55% of consumers said they knew purchasing counterfeits harms brands, and 47% knew it can be used to fund and support criminal activity such as trafficking and money laundering.
The most likely people to buy a counterfeit were the younger generation. In total, 70% of ‘generation Z ‘(those born in the late 1990s to early 2000s) and 63% of ‘millennials’ (those born in the early 1980s to mid-1990s) admitted purchasing counterfeits.
Change the record
Reacting to the findings, counsel say brands should focus on the positive messages they want their brands to convey rather than the negative aspects of counterfeit activity.
Dennis Wilke, brand protection coordinator at watch brand Cluse in the Netherlands, says companies should highlight what they can offer to the consumer as well as their credentials, including support for green or social initiatives.
“Consumers know that buying a counterfeit is harmful to the genuine brand financially, but their attitudes may change if they think a company’s ethos or values are under threat too.”
A brand like Patagonia is so associated with sustainability and the environment that anyone purchasing a counterfeit will know they are contributing to the exact opposite of what the brand is fighting for, he notes.
Those brands that do not have a strong message will struggle to convince consumers of the potential harm caused by counterfeits, beyond mere financial damage, he says.
Wilke says social media platforms provide the perfect opportunity for increased engagement, particularly with young consumers.
Jayne Durden, vice president of law firm strategy at Anaqua in the US, notes a huge rise in brands linking their products to environmental and social causes.
“These have been very successful because they form a connection between consumers and the products they use.”
The next step is for these brands to link counterfeits to the social issues consumers care about, Durden suggests.
“Similar to how brands raise issues like sustainability in their brand mission, they should also educate consumers on their counterfeit enforcement positioning. Ultimately, consumers would want to know about the connection between counterfeit goods [and crime].”
Mixed messages
However, Wilke at Cluse believes this message may fall on deaf ears.
“Everyone in the industry knows this [the link between counterfeiting and organised crime], but it’s too abstract a message to put to a consumer. I don’t think your average consumer believes one purchase is going to directly fund crime.”
He adds that there is also a danger that consumers will think the brand is simply protecting its own back if it continues with this approach.
The head of IP enforcement at an electrical goods company in the UK, who says the data is “disappointing but not surprising”, adds that counsel can also unwittingly tarnish their own reputation by speaking too much about counterfeits.
“It can be difficult for brand owners to talk about quality or safety issues associated with counterfeits because it risks tarnishing the image of their own (highly polished) brand. If there is a picture of a counterfeit handbag falling apart at the seams or an electrical product bursting into flames, it is hard to divorce this from an original product.”
Taking a back seat?
The legal counsel for a European high street chain believes counsel should take more of a back-seat role in the fight against counterfeiting and that law enforcement may be better placed to warn of the dangers of fakes.
“It probably should not be IP professionals that educate. They have historically (for the right reasons) promoted the IP side and the harm to brands. [But] that is not what’s going to change people’s minds.”
A senior in-house lawyer at a European cosmetics company says education alone will not work.
“It seems brands will have to enforce their IP for a long time, and education of consumers, while important, will not be sufficient to tackle the issue.”
However, the legal counsel at the high street chain notes that despite some consumers being uninfluenced by the potential links to crime, information on how the counterfeit industry works can help consumers understand that it is not usually the brand itself that is hurt but the most but the people who produce the counterfeits.
“Do they [consumers] know how dirty the business is?” he says.
‘Shocking’ stuff
Verena von Bomhard, partner at Bomhard IP in Spain, takes a more resigned approach in reacting to the “shocking” figures.
“The findings do not in any way reflect my expression from the society I live in. But I think that is the problem: I do not live in the same society.
“These findings show an ever-growing gap in society between those who have concerns and try to live up to them, and those who just make ends meet (although relatively high end) and don’t care about any consequences."
Durden adds that IP associations and law enforcement should continue publishing statistics and sharing examples that highlight the risks of counterfeit goods.
However, she believes there is still a role for IP lawyers to play.
“The best route for IP professionals to take is encouraging clients and brands to continue enforcing trademarks and patents publicly, helping to solidify the connection of counterfeits to the safety of consumers and the health of our economy.”
User penalties
If IP lawyers are continue the fight, law enforcement will still have an important part to play, sources agree.
The in-house source at the cosmetics company suggests penalties against those who import, export, or purchase counterfeits could be strengthened, rather than manufacturers being targeted.
“Generally, it seems end users risk less than the manufacturers in terms of penalties and probability to get caught.”
The legal counsel at the high street store agrees with this view. He says prohibiting importation and banning the purchase of counterfeits for personal use (as is the case in France) could be an effective measure.
Whatever approach is taken, counsel are unanimous on one thing – something has to give.
