Indian consumers perceive that almost 25-30% of all products sold in India are fake/duplicate. Globally it’s a $1.7 – 4.5 trillion economy.
But if almost everyone is aware of fake products, then why do consumers still buy them?
- Because 27% of consumers are unaware that products are counterfeit at the time of purchase, and
- the 31% that intentionally buy them, do so because of sensitivity to price, demand-supply gap (unavailability of original brands), desire to buy luxury brands, peer pressure, and social motivations.
Impact of proliferation of fake products
While peer pressure and societal motivation lead to the flourishing of fake/duplicate products for luxury brands, other sectors like medicines, FMCG, automotive, and consumer durables are also not immune to these counterfeit products.
For brands, this menace of fake products may lead to reputational damage, loss of trust, and an eventual reduction in sales.
But for consumers, it can lead to
- financial loss,
- health problems (duplicate medicines, skin issues), and even
- loss of life (In India, 20% of road accidents are because of mechanical failure of auto components, with several of these accidents on account of faulty and counterfeit parts)
What can brands do to fight fake products?
In 2018, Infosys came up with a report on using QR codes to track and identify counterfeit products
While it should be the responsibility of brands to educate consumers and crack down on the supply of fake/duplicate products, it should also be the responsibility of consumers to report fake products.
With the current penetration of mobile and the internet in India, brands can easily
- educate consumers via ads and promotional campaigns,
- motivate consumers to scan and report fake products via some form of customer reward program, and
- be more accessible to consumers reporting these fake/duplicate products.
References:
- 25-30% of all products sold in India are fake/duplicate – https://www.livemint.com/industry/retail/almost-25-30-products-sold-in-india-spurious-with-counterfeiting-report-11674655725574.html
- The Global Impact Of Counterfeiting – https://www.forbes.com/sites/forbesbusinesscouncil/2022/08/02/the-global-impact-of-counterfeiting-and-solutions-to-stop-it/?sh=433b03281ca2
- Authentication Solution Providers Association (ASPA) and CRISIL Report – https://www.aspaglobal.com/aspa-and-CRISIL-Report
- Infosys Report – https://www.infosys.com/industries/high-technology/white-papers/documents/deter-counterfeiting.pdf
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