Collected perspectives on authenticity

Consumer demand for authentic vs. counterfeit goods

Tim Phillips // Journalist, author, counterfeiting expert

Summary: Tim Phillips is a freelance journalist who writes about business, technology, and economics. He is the author of several books, including Knockoff: The Deadly Trade in Counterfeit Goods, and Talk Normal: Stop the Business Speak, Jargon and Waffle


Intellectual property lawyers, who often need a sense of humor, joke that counterfeiting is the second oldest profession. Like the oldest, it continues to flourish. Our two oldest professions, it seems, are immune to moral censure. If the authorities tell us that purchasing fakes is not the sort of thing that civilized people should be doing, then civilized people seem to have missed the memo.

Cognitive dissonance is the discomfort we feel when we manage to hold two contradictory opinions at the same time. I have spoken about counterfeiting in around a hundred conferences, radio studios and debates, and that is the universal response. I conducted market research, and more than 50% of us know that organized crime gangs profit from selling us our fake purses or clothes or watches.

On the other hand we can, and do, buy the stuff, and often enjoy the experience.

Previous generations romanticized crime too. The Abbé de Blanc wrote home to France in the 1750s in confusion that the British would boast about the abilities of their highway robbers as much as the strength of their armies. We're no different in 2013: The people among us who break the rules are exciting. We can overlook the theft and the fraud, as long as we're not the victims.

When we imagine that we're getting the best part of the deal, the effect is even stronger. When Bernardo Provenzano took over the Cosa Nostra (the Mafia in the US) in Italy in the 1990s, he ordered that his troops cut down on the executions and beatings. Provide services for ordinary people and cooperate with local government, he told them. Nicknamed "The Accountant," he believed painting the Cosa Nostra as an asset to the community would leave it unimpeded in its real business of extortion, fraud, and counterfeiting. The plan worked. During this time, The Accountant's staff built a good business in the supply of fake substandard aircraft and auto parts, apart from the usual fake cigarettes and watches.

Twenty years later, Detective Superintendent Andy Sproule, retiring as head of the Organized Crime Squad of the Police Service of Northern Ireland, told me Northern Ireland was the same. While 97% of the local community believed the 230 organized crime gangs in Northern Ireland – who dealt in gun-running, drug dealing, and punishment shootings for competitors – were a social problem, they were also the monopoly suppliers of counterfeit consumer goods. "It's good for them to be seen as providing goods at a cheap price," Sproule said. "Everybody loves a bargain."

We don’t tolerate counterfeiters if they make fools of us... But, when we feel we are in control, we love to pretend.

We don't tolerate counterfeiters if they make fools of us: In the fifteenth century Charles V of France even passed a law that the weavers of fake tapestries should have their right hands cut off. But, when we feel we are in control, we love to pretend. Fast forward to 1896 France, where a manufacturer of expensive steamer trunks has his designs copied by low-cost imitators. In frustration, he creates his own distinctive, initialed fabric that he can protect by law. Today Forbes values this brand - Louis Vuitton - at $24.5 billion – three times its annual sales. And millions of people still choose to buy a LV fake.

Brands often create products that are surprisingly easy to fake, because the production process – and even the design process itself – is outsourced. The counterfeiter finds a factory that will mass-produce a copy accurately, at a lower standard and a lower price. Then we hear about ethical lapses from brands that manufacture the genuine products in sweatshops, or claim that a product that was 99% finished in China is apparently from Italy. Our cognitive dissonance becomes easier to sustain.

Sometimes the fakers seem more creative than the brands they copy. Who cannot admire the resourcefulness of the 2001 Wrigley gum counterfeiting ring in Guangzhou, when the fakers not only counterfeited the gum and packaging, but the delivery uniforms and trucks? On the one hand, it's organized crime. On the other, it could be taught in business school.

On the one hand, it's organized crime. On the other, it could be taught in business school.

Mass counterfeiting like this means there is simply too much fake product for the police to confiscate. As one investigator told me: "It's like holding back the sea."

We accept this imperfect world until we are the victim of it. We don't ask where something comes from, or who is profiting from it, because we want it.

We ask lawyers and police to save us from our own preferences, and so the war on counterfeiting is already lost. Authenticity isn't just a logo though: It comes from the ethical standards of the people who make it, ship it, and sell it. It matters, because it shapes the world we live in. We become what we consume.

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Consumer demand for authentic vs. counterfeit goods

Tim Phillips is a freelance journalist who writes about business, technology, and economics. He is the author of several books, including Knockoff: The Deadly Trade in Counterfeit Goods, and Talk Normal: Stop the Business Speak, Jargon and Waffle

Read here »

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