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The Affect of Counterfeit Products on Luxury Brands

An Empirical Investigation from the Consumer Perspective

Written by A. Cademan, R. Henriksson & Vi. Nyqvist

Paper category

Bachelor Thesis


Business Administration>Marketing & Sales




Thesis: Counterfeit product theory According to marketing literature, counterfeit products of luxury brands are related to low quality and low prices. Counterfeit products are also offered to a wider market than genuine luxury brand products, which endangers the exclusivity of genuine luxury brands (Grossman & Shapiro, 1988; Lai & Zaichowsky, 1999; Gistri, 2009; Sharma & Chan, 2011). There is a high demand for counterfeit products in the market. There are two main reasons why people buy counterfeit luxury brand products: the low price compared to genuine luxury brands and the value expression function provided by the brand (Cordell et al., 1996; Wilcox et al., 2009; Wiedmann et al., 2012. Consumers) Buy counterfeit products as an identity symbol and classify themselves into the prestigious social groups they want to belong to (Grossman & Shapiro, 1988; Wilcox et al., 2009). By wearing counterfeit products from luxury brands, consumers can Identifies with people who wear original luxury goods and claims to belong to the same social class as original luxury brand users, as long as no one says consumers wear counterfeit products (Gistri et. al., 2009). The price of counterfeit luxury brand products is only the genuine price A small percentage of people tend to buy counterfeit products to reduce the risk of spending a lot of money on original products (Tom et al., 1998; Wiedmann et al., 2012)). Although counterfeit products are of low quality, they are value for money because they provide other utilities related to consumers of luxury brand products, such as personal identity (Wilcox et al., 2009; Wiedmann et al., 2012). Gistri, (2009) added areas to buy counterfeit products because they are interesting. In a sense, they can be given to friends and family as gifts during the holidays because it is a high-value product for the home A country with cheap imitations, under normal circumstances, the person who sent it can never afford to give it as a gift. Previous research (Nia & Zaichowsky, 2000) evaluated consumers' perceptions of counterfeit products from eight dimensions based on literature. The eight dimensions are: if the counterfeit product looks like a status symbol, prestigious, ordinary, interesting, worth buying, quality, durable, and exclusive. 2.2 Customer-based brand equity As discussed in the discussion, counterfeit products can harm real luxury brands. In order to be able to find the answer to this hypothesis, it is necessary to measure consumers' perceptions of real luxury brands, which can be used in a variety of ways (Fairclothet. al., 2001). One method is to measure brand equity (Aaker, 1991), but also to focus on customers (Keller, 1993), which is used in this article. The following will further explain the concept of how to measure customer-based brand equity. 2.2.1 Brand associations of luxury brands As mentioned in the previous section, brand associations are generated in the minds of consumers (Aaker, 1991). These associations are further divided according to the type of association created (Keller, 1993). When it comes to luxury brands, there are several items associated with these brands. As luxury brands are associated with high prices and high quality (Turunen & Laaksonen, 2011), the brand associations of luxury brands should fall into these themes. Other researchers (such as Kim et al., 2003; Tong and Hawley, 2009; Chen and Tseng, 2010) have used different items when measuring brand associations, which can be based on Turunen and Laaksonen (2011). The definition is classified as a luxury. These items are expensive (Kim et al., 2003) and status symbols (Tong & Hawley, 2009; Chen & Tseng, 2010). According to Kapferer & Bastien (2009), luxury brands are dedicated to a specific social class rather than to everyone, which makes the product exclusive to you. This exclusivity creates the satisfaction of belonging to this particular social class (Kapferer & Bastien, 2009). Other researchers believe that social class affiliation depends on luxury brands and high-end goods (Kim et al., 2003), good reputation (Lassar et al., 1995; Chen & Tseng, 2010), and pride (Lassaret. al., 1995; Pappu et. al., 2005. In addition, it is said that luxury brands should restrict distribution to ensure a high level of service (Nueno & Quelch, 1998; Kapferer & Bastien, 2009), which can be related to the level of brand association declared by other researchers. For example, Trustworthy (Lassar et al., 1995; Pappu et al., 2005; Tong & Hawley, 2009) and service level (Kim et al., 2009)., 2003). Therefore, the following items can be classified as brand associations for luxury brands; status symbols, expensive, high-end goods, good reputation, pride, trustworthiness and service levels. If a brand manages to connect with these associations, then brand users will also be accepted, recognized and admired by others (Dubois & Duquesne, 1993). 2.2.2 Perceived quality of luxury brands Perceived quality is the customer's perception of the overall quality or advantage related to the product or service (Aaker, 1991). Therefore, it should be quite obvious to determine the perceived quality of a luxury brand, because it has been confirmed that a luxury brand should have excellent quality (Turunen & Laaksonen, 2011) and high level of service (Nueno & Quelsh, 1998; Kapferer & Bastien, 2009) ) And unique designs that ensure the quality of each specific product (Nueno & Quelsh, 1998; Hellofs & Jacobsen, 1999; Commuri, 2009). These items of luxury brands can be compared with measurements of perceived quality made by other researchers (eg Pappu et al., 2005; Tong & Hawley, 2009) such as Durable (Pappu et al., 2005). Read Less