By Jan Maarten Laurijssen
Like some of you reading this, for me the end of summer means ‘back to school.’ If you work in a business where sales are concentrated around seasonal events like back to school, however, then it probably means even more.
For brands who sell toys, clothing, and electronics especially, seasonal events like these create clusters of sales that are a big opportunity, but the accompanying rise in online fakes also poses a serious challenge. Counterfeiters are unscrupulous in who they target so it’s unsurprising that listings for potentially dangerous fakes aimed at children should also rise around now. This article examines some of the industries most at risk from counterfeits at this time of year, including suggestions on how businesses can protect their customers, their reputations, and their sales from counterfeits.
The Back to School Shopping Sector in 2019
Back to school shopping used to be relatively simple; parents sent their children off to the fall term with a fully-stocked pencil case, a sturdy school bag, and a warm coat. As in many other sectors though, the consumer spend on back to school supplies has risen dramatically in recent years. According to Deloitte’s assessment for 2019, in the United States, sales per student have now reached $519, making for a total spend of $27.8 billion. This growth has been driven by the increased demand for mobile tech and computer hardware, and made easier by the swing from physical buying to frictionless online purchases.
Which businesses are affected by counterfeit back to school products? More than you might think, and quite possibly yours.
Whether it’s branded clothes and backpacks or stationery and smart phones, school-year purchases affect a huge number of brands. Unfortunately, the number of counterfeit listings is also commensurately high and they appear on hundreds of different online marketplaces, social media channels, and domains. Even for those sectors that have a more universal appeal (printer ink, for example), it’s a period that should be seasonally adjusted for when you plan out your brand protection strategy.
If you want to know how to plan most effectively though, it’s helpful first to understand exactly what the problems are.
The Problems with Back to School Fakes
For most brands who suffer from a spike in counterfeit goods at this time of year, there are three main problems.
First, there’s the issue of availability. This is a particular problem for back to school brands because so many of their sales are conducted online. Some estimates suggest that the three highest retail categories for online purchases are clothing, footwear, and consumer electronics, which also happen to be three of the peak categories for back to school. Cosmetics and furniture, on the other hand, remain more commonly shopped in physical locations, but as these are not included in the school shopping cart they do not suffer more at this time of year.
So, with more parents intentionally looking online for certain goods, and many of them wrongly assuming products are official, a comprehensive brand protection strategy needs to account for exactly where and when these searches are taking place. The global nature of counterfeiting means that protecting your business must go beyond searches of the worldwide eBay and Amazon sites, and that the extra resource you dedicate to online removals should be targeted.
To take one example, according to the European Ecommerce Report 2019, Russia’s three favourite e-commerce sites are Avito, Aliexpress, and Yandex. A simple search on Avito for “картридж Epson” (cartridge) returns over 8,000 listings. And, while some of these may be legitimate, the number of these listings is staggeringly high when compared with more obviously policed platforms like eBay and Amazon. Despite showing images of legitimate packaging, many of the listings on Avito offer cartridges for less than half their genuine RRP – a questionable sign for investigators.
The key here is that online availability changes by country, by season, by language, and by platform. Adjusting your strategy to account for all these variables is necessary for optimal performance. With online back to school purchases growing (from 22% in 2016 to 29% in 2019), it’s more important now than ever.
A second problem for brands lies in the nature of the event and the consumers it attracts. Most buyers see their purchases as purely seasonal (true for clothing and supplies but less so for electronics), so a degree of price sensitivity is built into their behavior – in fact, 57% of buyers say that price incentives are the primary driver of their actions. As a result, many shoppers are more inclined to really search out the bottom-most prices in the belief that the goods will only last so long anyway. This caters to online counterfeiters who undercut legitimate retailers and suppliers.
It’s clear though that this attempt to save pennies ends up costing pounds because fake products are cheaply made, break more frequently, and lack a proper returns policy. In the example below, the Fortnite-branded backpack listed here is advertised as a back to school item but does not appear on any legitimate sites.
Among the 544 Wish.com reviews for this product are a litany of complaints from buyers who either didn’t receive the product, received the wrong product, or who received broken (or soon to break) bags. Among the worst are comments like “It dosnt glow in the dark and there is no bit were the earphone are charger goes in the bag it doent look like the picture my wee boy is sad” (sic) and “the zippers broke first day using it. The first day of school was good till the zippers broke on the backpack my son was so sad” (sic). Nobody should be sending their wee boy off to school only to return with a sad face and a broken bag!
How can brands use this to their advantage? Disgruntled consumers are not good for business as there are many among them who unintentionally buy counterfeits but then complain publicly about your company, thus damaging your reputation. You can protect against this to some degree by publicizing a clear policy on legitimate and fake goods on your website, and also by soliciting information about fakes from them. The best option though is to work on removing as many fake listings as possible, especially ones that let down consumers and damage you by association.
A third consideration for back to school brands is the power of trends and cross-brand counterfeiting. The internet has given rise to rapidly changing trends, with today’s viral sensation being tomorrow’s discarded cartoon character. This means that branded bags, for example, may fall out of favor quicker and need replacing more frequently. This is especially true for product categories where purchases are more frequently steered by children rather than adults. Clothing and accessories are more obviously controlled by the child’s wishes and 77% of purchases show moderate to high child influence – in contrast to hardware purchases where their influence is much lower.
On Wish.com, luminous backpacks like this one branded with the trademarks of footballer, Lionel Messi, demonstrate how popular certain trends can be. This item, which may be counterfeit, has over 700 reviews. Assuming the advertised price has been constant, this means that this seller has earned in excess of $11,000 from this one product. Given the number of other brands, celebrities, and popular trends that can be printed onto cheap bags, this means potentially huge profits.