Study: Why Counterfeiters May Be Good for the Fashion Industry

The counterfeit industry has long been considered detrimental to high fashion, as it is thought to lessen our desire to pay for luxury goods when we can just buy identical but significantly cheaper versions instead. Obviously, the craftsmanship involved in these fakes is nothing like that of the originals, but the success of this black market proves that many customers don’t care.

Industry players, on the other hand, are largely united in fighting against this phenomenon, but a new study from the University of British Columbia suggests that there might actually be good reason to keep it around.

The study looked at financial statements of 31 brands selling leather and sports shoes in China over a 12-year period when counterfeit production was at an all-time high. What researchers discovered was that the original designers were forced to improve the overall appearance of their products and use fancier materials in an effort to make direct copying more challenging.

According to the study’s author, Yi Qian, a professor at UBC’S Sauder School of Business, “When counterfeiters start fooling too many customers, authentic brands step up their design game. The authentic producers will make the most of any cost advantages they have to produce more highly differentiated goods shoppers can easily identify as the real thing. In fashion this can mean an increased focus on aesthetics.” Or, to put it simply, the counterfeit market seems to drive legitimate fashion designers to be more innovative with their products.

It’s an interesting angle, for sure, but it doesn’t negate the need to regulate the counterfeit market. Yi Qian agrees, though she believes that “policy-makers should take note of how counterfeiters impact industries differently and concentrate their efforts where it matters most.” In other words, get rid of the really bad guys, but keep a little counterfeit action around if we want to encourage top-notch design.

Head to UBC to learn more about the study, and shop some of our favourite authentic items, below. What do you think about these results? Sound off in the comments!

Louis Vuitton Speedy 25 ($990)

In 1930, following the success of the Keepall, Louis Vuitton launched a smaller version aimed to be a handbag for travel: the Speedy. The original name, “Express,” was changed to “Speedy” as a reference to the development of modern means of transportation and the increasingly faster way of living.