This year's Cyber Monday may be merely part of a cyber shopping season -- for the first time over half of American consumers shopped online during the holiday weekend -- but one thing hasn't changed: the counterfeiting conundrum we might call "cyber shrinkage."
According to an eye-opening new report from online brand protection firm MarkMonitor, one in five online bargain hunters lands on sites selling fakes instead of legitimate discounted merchandise. These aren't the shoppers deliberately looking for counterfeits or "replicas," mind you -- these are shoppers using search terms like "discount," "clearance," and "outlet." It turns out that honest bargain hunters are demographically almost identical to their counterfeit-seeking cousins in terms of education and household income, but there are 20 times as many of them. That adds up to a lot of otherwise savvy sale shoppers diverted to sites selling counterfeits. Even worse news for brand owners: sites selling fakes are sticky. Shoppers stayed longer and were more likely to place counterfeits in their shopping carts, potentially believing that they'd simply found discount deals.
The silver lining in the MarkMonitor report, prepared in collaboration with Nielsen and including both U.S. and European data, is a wealth of information about consumer behavior. The research project started with an insight of simple brilliance, namely that the methods used in search-and-destroy missions aimed at shutting down counterfeit websites could also be employed to elicit information and develop constructive brand strategies. Trademark lawyers regularly describe their work in terms of the arcade game Whac-a-Mole -- counterfeit sites pop up, intellectual property owners smack them down, the fakes pop up again elsewhere. The end result? A lot of whacked moles -- or counterfeiters, as the case may be. But to extend the analogy, why not take that data and make a moleskin coat?Among the report's general recommendations is the suggestion that brands -- including luxury labels that don't engage in online sales -- buy terms like "discount" in order to direct search traffic and educate consumers. The report also suggests purchasing domain names with bargain-related terms before counterfeiters do. A conversation with the MarkMonitor team indicates that the strategic potential of this data, and the more specific details available to individual companies, is even more extensive. Knowledge that consumers in particular locations are searching for deals on specific brands or product categories (footwear turns out to be a universal favorite) can inform plans for a diffusion line, a partnership with a flash sale site, or the establishment of an outlet. After all, with the increasing popularity and sophistication of online bargain shopping, it doesn't pay to let counterfeit sites steal away one in five potential customers.
(Note: No actual moles were harmed in the preparation of the MarkMonitor Shopping Report. But mammals engaged in underground counterfeiting activities may be another story.)
