Throughout the years in the anti-counterfeiting business there have been a few times where we, and our clients, have lauded our victories when a raid was accomplished on a factory making Chinese knockoffs. Once, I remember, back in 2006 our client’s attorney actually saw thirteen people in handcuffs. Chinese nationals, in China. In cuffs for making fakes. Not bad for a case that started with some handbags sold by a Purse Queen in Missouri! Every time I tell that story, I finish it with the punchline that “I’m sure the cuffs came right off when my client boarded the plane.” I’m not faulting China and that really isn’t my point here. But the disconnect between cultures is. There is obviously a totally different meaning of ‘authenticity’ when you cross oceans. You may recall the incident during the opening ceremony of the 2008 Beijing Summer Olympic Games when the seven year-old vocalist who was commissioned to sing ‘Ode to the Motherland’ was replaced by a prettier lip synching faker. A recent Slate article reports on a whole new kind of counterfeiting: fake prisoners. No kidding, guys. People who are facing jail time in China can hire a less-fortunate guy to confess, or just replace him in the can. This brings me to a whole new thought on the counterfeit enforcement business. While diplomacy with China is important in the fight against counterfeit goods, raiding their factories and jailing their owners is probably not effective.
The most important facet of my solution is to curtail the demand in the United States and other countries with a massive consumer base. The way to do that is to enforce against all sellers of this product in those countries. Contrary to the spirit voice in Field of Dreams, wise businessmen will tell you that supply does not dictate demand. Stop promising your client you’re gonna get the “big factory” and focus on stopping the mid-level distributors here. I promise your performance numbers will increase and, most important, you will help restore value and dignity to the client’s brand. I know from great experience that many people who became huge sellers of counterfeit goods here in the United States would have stopped if they had just worn a pair of handcuffs early on. One night in jail works wonders on the soul. Enforcing the smaller crimes is part of the plan that makes many of our inner cities safer. Curtailing vandalism in your neighborhood leads to less violence down the line. In tough economic times it is easy to cut costs and focus on the biggest problems. The problem with the latter is that no big problem started that way. My suggestion to my readers is to simply place most of your efforts on the cities and countries with the highest retail sales of genuine product. I’m not talking about the people selling fakes at swap meets or in the bad neighborhoods. I’m speaking of the mid-level distributors who are getting their product directly from China and supplying those folks.
Now I’m going to finish my coffee.
I first observed this group a few years ago doing business as Managed Solutions Group (MSG) when they were popping up as a US-based web host for China-based sellers of counterfeit goods.
Some of you may have been in attendance at one of my public appearances last year entitled “2008 Cyber-Review”. In this presentation, I covered tips, tricks, trends & tactics that I thought were important to impart to you folks. One of the trends about which I spoke was the virtual goods market. I stated that brands needed to protect themselves from the sales of counterfeit virtual goods because it was only a matter of time that they themselves will tap this market for profit.
