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Title: Executive Assessment of Counterfeit Trade in Five Countries: Examining the Multi-Faceted Motives of Piracy and Consumer Demand
Author: Peggy Chaudhry and Stephen A Stumpf [Villanova University]

Journal of World Business (in review)

Year: 2008


Subject/Type: Counterfeiting
Focus: Brands (deceptive counterfeits), Brands (non-deceptive counterfeits)
Country/Territory: Australia, French Polynesia, New Zealand, South Africa, United States of America
Objective: To compare the perceptions of business executives regarding the likely causes of piracy - and the rationale behind the purchase of counterfeit goods - in several different countries.
Sample: 212 executives in leadership or professional service positions in five countries
Methodology: Structured survey

Main Findings

Executives in all five countries surveyed (except South Africa) consider profitability to be the most important driver of counterfeit supply. "Ease of sale due to weak enforcement" of intellectual property (IP) rights ranked second overall (and first in South Africa). The perceived relevance of other supply drivers, such as limited criminal and civil penalties, varies by country.

Overall, the three drivers of consumer willingness to purchase counterfeit goods perceived as most important are: convenience, desirable product attributes (e.g. image, price), and low income/education levels. Convenience and desirable product attributes rank first or second in all countries except South Africa, where a low income/education level is considered more important than the product attributes.

Over three quarters of executives (76%) think that consumers know a product is counterfeit when buying it. In all countries except South Africa, the cues considered most effective in determining product authenticity are: purchase location, price, and packaging. In South Africa, product cues are not viewed as meaningful tools to help consumers identify counterfeits.

Executives found the following anti-counterfeiting actions most effective: the use of special packaging/labelling, followed by offering site licenses, and reduced prices/rebates. The anti-counterfeiting actions perceived as most effective vary widely across the countries studied, suggesting that a "one-size-fits-all" approach to anti-counterfeiting will lead do sub-optimal results and wasted resources.

The authors suggest four broad approaches companies may take to bolster the protection of their IP rights: create a better dialogue with other firms about the success or failure of anti-counterfeiting strategies by country; initiate creative social marketing tactics to reduce consumer demand for fake goods, recognise country differences in the approach taken; seek more publicity about the enforcement of criminal penalties to invoke fear in both the consumer and the provider of counterfeit goods; educate the general public and policymakers that counterfeits are also in non-traditional goods such as pharmaceuticals, so as to garner more empathy for the protection of IP rights.

[Date Added: Aug 22, 2008 ]