••• brand research
Study finds counterfeiting can benefit brands
Counterfeit products have the power to stimulate innovation in the fashion industry and benefit consumers, according to a study published in Marketing Science, a journal of the Institute for Operations Research and the Management Sciences, Catonsville, Md.
The authors of “Untangling searchable and experiential quality responses to counterfeiting” investigated how brands react to counterfeits and what are the effective means of enforcement against counterfeits. They studied financial statements of 31 brands selling fashion leather and sports shoes in China over a 12-year period. During this time, counterfeit production surged due to a change in the government’s enforcement policy.
The study outlines scenarios where counterfeits in the market can stimulate authentic producers to improve aesthetics for high-income consumers and improve affordability for low-income consumers. In these cases, many consumers are, in fact, better off.
Most observers assume that counterfeits are bad for producers of original genuine products. However, the authors found that such producers react to counterfeiting by using superior materials and better shoe designs, whereas no corresponding improvements occur for knock-offs.
When counterfeiters fool too many customers, authentic brands step up their design game. The authentic producers make the most of their cost advantages to produce more highly differentiated goods from the counterfeits, which shoppers can easily identify as real. Consumers benefit from this strategy because part of their satisfaction derives from superior aesthetics.
••• the internet of things
We’ll be hearing more about ‘hearables’
A Retail Dive article, via Biz Report, argues that “hearables” – wearable products that deliver audio cues to users and accept voice-activated commands – are set to have a huge impact on the Internet of Things (IoT) phenomenon, likely delivering many new capabilities, even voice-activated shopping, to consumers.
Hearable technologies are projected to rack up $5 billion in sales by 2018, according U.K.-based Wifore Consulting, or about the same amount as the entire wearables market will take in this year. Why? They tend to be more discreet than other wearable interfaces and people are already accustomed to in-ear technologies.
The real potential for hearables lies in their ability to function as a listening device. Similar to Apple’s Siri and Microsoft’s Cortana, most hearables will accept spoken commands, which means they can be used to perform any number of IoT functions, from turning off the lights to ordering groceries. Equipped with two-way, in-ear hearable devices, people could soon be able to perform practically any shopping function – from finding a store, to ordering an item, to making a payment – from any location within the range of one’s voice.