Fashion Market: Counterfeit Measures

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Fashion Market: Counterfeit Measures

The four most commonly used strategies/methods by global fashion brands to combat counterfeits include the use of Police Intellectual Property Crime Unit (PIPCU), surprise raids on wholesalers, formation of brand-made intellectual property rights team, and Big Data Anti-Counterfeiting Alliance membership.

ANTI-COUNTERFEIT STRATEGY/METHODS

1. THE USE OF THE POLICE INTELLECTUAL PROPERTY CRIME UNITS

  • Some global fashion brands combat counterfeits through the use or cooperation of the Police Intellectual Property Crime Unit (PIPCU), created by the UK Police.
  • A PIPCU investigation starts with detailed information of an alleged fraud that will be given by fashion brands regarding counterfeit products.
  • The PIPCU then continues by searching for the website, collecting evidence, and they approach a domain name registry like Nominet in the UK to shut down the site.
  • The police unit also storms the premises found from their investigation which holds counterfeit products and can get the lawbreakers jailed for up to 10 years after.
  • This unit's mission is to help stop the penetration of the counterfeit products in the market, and also for education to the customers of ways to spot the fake products.
  • One example of a fashion brand/company that has utilized the PIPCU strategy is Ugg, a California sheepskin boots company, which partners with law enforcement worldwide, to execute raids and initiate prosecutions.
  • Ugg company has a total legal action taken against 60,000 websites selling replica clothing and footwear.
  • Ugg provided a URL checker on their website to allow its customers to check that the site is an authorized retailer, along with photos of authentic products with which to compare.

2. SURPRISE RAIDS ON WHOLESALERS

  • Another common strategy/method used by fashion brands includes the use of surprise raids on wholesalers, to identify and then seize fake products being sold off as authentic.
  • This strategy focuses on counterfeit products being sold by wholesalers to take them off the market and apprehend the counterfeiters.
  • Some brands even target trade shows where wholesalers sell their counterfeit products. When the wholesalers who sell fake products expose themselves at trade shows, fashion brands have the opportunity to obtain evidence and seize the counterfeit products, which will help to charge and convict them in court.
  • One fashion brand example which uses this strategy/method is Lacoste.
  • Lacoste once initiated a surprise raid of wholesalers and retailers, across Puerto Rico, where they seized counterfeit products with estimated costs of over $1 million in retail value. The confiscated products include polo shirts and dress shirts that would have been sold to unsuspecting customers if left on the market.

3. BRAND-MADE INTELLECTUAL PROPERTY RIGHTS TEAM

  • Having a brand-made, or internal, intellectual property rights team is another strategy/method being used by fashion brands to combat counterfeit products.
  • Fashion brands who use this strategy are usually among the luxury groups of the fashion industry, which employs large teams of lawyers to monitor, examine, and control wholesale and retail markets, both online and offline.
  • Their in-house team of lawyers usually sets the customized anti-counterfeiting strategy for each brand on their portfolio. They also work closely with external legal advisers, custom officials, and enforcement officers to organize raids for seizing and confiscating counterfeit products.
  • An example of a company which uses this strategy is Louis Vuitton, which manages over "18,000 intellectual property rights, including trademarks, designs, and copyrights with support of 250 agents around the world."
  • Louis Vuitton, initiated in 2017, has about 38,000 global anti-counterfeiting procedures, which resulted in the break-up of criminal networks and led to the release of the workers of the criminal organizations.

4. BIG DATA ANTI-COUNTERFEITING ALLIANCE MEMBERSHIP

  • Another commonly-used strategy/method by fashion brands to combat counterfeits is the Big Data Anti-Counterfeiting Alliance membership, which was initiated by China's e-commerce giant, Alibaba in 2017.
  • Through this alliance, brands which join them will "foster industry collaboration and promote the use of big data and technology in the global fight against counterfeits."
  • Alibaba Group's Anti-Counterfeiting Alliance, which was officially named Alibaba Anti-counterfeiting Association (AACA), initially had 20 members in 2017.
  • That number tripled in 2018, with the addition of big-name fashion luxury brands such as Valentino, Estee Lauder, and Shiseido.
  • The alliance will help fashion brands to prevent online pirated listings on Alibaba's platforms, and provide further assistance with legal actions, investigations, and prosecutions that will happen outside the platform.
  • Some fashion brands that used this strategy and joined the alliance are Louis Vuitton and Swarovski.
  • Louis Vuitton and Swarovski used the alliance's advanced technological support and counterfeiting protection to protect and combat counterfeiters.
  • Since the time they joined Alibaba's Anti-Counterfeiting Alliance, they were able to seize counterfeit goods with a market value of about 4.3 billion RMB ($700 million) in 2017, an increase from the $438 million worth of fake goods seized in 2016. (s7)

RESEARCH STRATEGY

We began by searching for the most commonly used strategies/methods by fashion brands to combat counterfeits by searching for pre-compiled lists with relevant company examples and metrics of success using reputable and credible sources such as World Trademark Review, Business of Fashion, Certilogo, Nanomatrix Secure, PERSPEX, Fashionista, Jing Daily, WWD, and Louis Vuitton. We then defined the "most" commonly used, as the strategy/method that was mentioned and identified by at least two reputable sources from those mentioned above. We then came up with four strategies/methods using, which we provided in our findings above.
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