Now it’s Brand-policing

IIPM : EXECUTIVE EDUCATION

Zaheer Khan,
Chairman, Enforcers of Intellectual Property Rights

Now it’s Brand-policing

The Indian counterfeit market share has gone up significantly over the last five years due to increasing brand awareness. Large sums of money being spent on advertising and promotional activities is increasing the scope for counterfeiters to cash in on the well-known brands. The mushrooming of counterfeit and gray market is encouraged by the fact that the margins involved in counterfeiting are high and penalty for counterfeiting is not that serious. People find it an easy avenue to make quick money. India and China constitute the largest counterfeiting problem that the world faces. Both have a very large user population as well. Not only do we churn out a lot of counterfeit for exports for use in different countries, we also use a lot of counterfeits that we make.

Actually we are the biggest market for counterfeiting. Though there is no one study which can quantify the amount of counterfeiting yet, it is safe to say that in every industry now the rate of counterfeits are alarming. Counterfeiting always happens in the most popular, most advertised and most publicised brands. They are the easiest brands to cash in on because they are the ones who spend most money in building these brands. The downturn and misgiving are by the buckets of counterfeiting, first being the huge revenue loss.

And of course, then there is loss of customer and brand value. If a customer buys a substandard counterfeit product and has a bad experience, he may not return to the same product thereby causing brand value loss and product loyalty loss.

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Source : IIPM Editorial, 2008

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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