the Global Scheme of Luxury Counterfeit
By Colette Kanbarian
When thinking of the term counterfeit, the archetypal image comes to mind of iconic bag silhouettes strewn along the floor of Downtown’s santee alley, adorned with uneven monograms and cheap pleather. However, the global luxury counterfeit industry has progressed greatly from easily-detectable fakes to incredibly engineered replicas that are able to pass the authentication systems of both expert buyers and top reseller sites such as TheRealReal. The total counterfeit trade industry is estimated at around $4.5 trillion, with fake luxury goods accounting for 60% to 70% of that amount. As the internet allows for greater anonymity and accessibility, the luxury counterfeit market has progressed far past conspicuous fakes and developed into an industry capable of not only deceiving, but effectively duplicating.
An integral part of the value proposition of a luxury brand is quality. While designs are simple to copy, consumers often associate a high price tag and reputable brand name with top quality. This valuable distinction has long separated the target markets of luxury and counterfeit goods, or at least the public perception of the two industries. The same customer able to walk into Chanel and purchase a $8,800 Classic Handbag will likely never buy a $40 knockoff, either off of the sidewalk or from popular Chinese dupe websites such as DHgate or AliExpress. However, counterfeiters have become so skilled and informed that there is now a lesser-known but highly profitable option on the market: the ability to craft a product of equal quality and look for a more affordable price point, likely in the hundreds of dollars. These replicas solve the issues of noticeability and quality that usually prevent customers from buying counterfeits. Simultaneous with egregious price increases at the hands of many luxury brands, the advantage to spending thousands on a single piece is diminishing.
Many question how these counterfeiters are able to replicate the prestigious production processes of luxury fashion houses. The answer is that this reputation of excellence is little more than a facade. The coveted “Made in Italy” label on many luxury goods, stamped just below the esteemed brand names, represents a false promise of superior quality. According to the European Union’s rules of origin, in order for a product to be labeled by country of origin, the final production process must be carried out in that country. The label does not consider the national origin of the craftsmen or the sourcing of the materials. Under United States law, a product must simply have its “last substantial transformation” in the country of origin. These laws leave substantial room for ambiguity in the supply chain. While a Gucci handbag may be assembled in Italy, the “Made in Italy” stamp does not signify, for example, where the leather panels came from, the metal handles were produced, or represent any accountability for the labor conditions and identity of the craftsmen. Even for goods produced entirely in Italy, the work is often done by immigrants under unjust conditions. In 2018, New Yorker reporter D. T. Max published a jarring piece on the continued reliance of luxury fashion houses on large-scale immigration from Wenzhou, China into Italy’s Tuscan region in the 1990s. These Chinese immigrants effectively became the manufacturers for brands such as Gucci and Prada, working under brutal mill owners who evaded taxes, ignored health codes and paid next to nothing. While brands charge a premium for their “Made in Italy” status, they conceal the unethical treatment of the workers stamping these labels.
The shattered image of supremacy and perfection largely synonymous with these luxury fashion houses has paved the way for counterfeiters to invade the market. These problematic supply chains not only undermine the brand’s reputations of quality, but result in a production process that is susceptible to outside duplication. And replicas are getting better than ever. Gone are the days of back-alley purchases and the “undercover” image of the counterfeit industry. Now, consumers are turning to Reddit forums, TikTok accounts and industry experts to uncover the best quality dupes, comparing stitching, prices and eerie similarity. These users are discussing super fakes: replicas that are extremely high quality and can only be distinguished, if at all, by trained experts through rigorous inspection. Brands such as Moncler and Chanel have even experimented with retiring authenticity cards for microchips in an attempt to beat counterfeiters. Virtually any design is vulnerable to replication immediately after reveal, leaving brands with the responsibility of generating enough value to justify an unknown commitment to legitimacy to which only the consumer themselves is privy.
As the line continues to blur between the looks, quality and ethics of counterfeit versus legitimate luxury products, the choice between the two becomes increasingly complicated. Customers begin to question the importance of brand identity and whether allegiances to loyalty and authenticity are worthy of not only astronomical prices but compromised standards. Many moral concerns are raised–intellectual property violations, artistic theft and shady supply chains–that have long discredited luxury counterfeits in the eyes of consumers. Ultimately, it is difficult to influence the purchases to be made when no one is watching, to uphold the value of the real against the fake.
An integral part of the value proposition of a luxury brand is quality. While designs are simple to copy, consumers often associate a high price tag and reputable brand name with top quality. This valuable distinction has long separated the target markets of luxury and counterfeit goods, or at least the public perception of the two industries. The same customer able to walk into Chanel and purchase a $8,800 Classic Handbag will likely never buy a $40 knockoff, either off of the sidewalk or from popular Chinese dupe websites such as DHgate or AliExpress. However, counterfeiters have become so skilled and informed that there is now a lesser-known but highly profitable option on the market: the ability to craft a product of equal quality and look for a more affordable price point, likely in the hundreds of dollars. These replicas solve the issues of noticeability and quality that usually prevent customers from buying counterfeits. Simultaneous with egregious price increases at the hands of many luxury brands, the advantage to spending thousands on a single piece is diminishing.
Many question how these counterfeiters are able to replicate the prestigious production processes of luxury fashion houses. The answer is that this reputation of excellence is little more than a facade. The coveted “Made in Italy” label on many luxury goods, stamped just below the esteemed brand names, represents a false promise of superior quality. According to the European Union’s rules of origin, in order for a product to be labeled by country of origin, the final production process must be carried out in that country. The label does not consider the national origin of the craftsmen or the sourcing of the materials. Under United States law, a product must simply have its “last substantial transformation” in the country of origin. These laws leave substantial room for ambiguity in the supply chain. While a Gucci handbag may be assembled in Italy, the “Made in Italy” stamp does not signify, for example, where the leather panels came from, the metal handles were produced, or represent any accountability for the labor conditions and identity of the craftsmen. Even for goods produced entirely in Italy, the work is often done by immigrants under unjust conditions. In 2018, New Yorker reporter D. T. Max published a jarring piece on the continued reliance of luxury fashion houses on large-scale immigration from Wenzhou, China into Italy’s Tuscan region in the 1990s. These Chinese immigrants effectively became the manufacturers for brands such as Gucci and Prada, working under brutal mill owners who evaded taxes, ignored health codes and paid next to nothing. While brands charge a premium for their “Made in Italy” status, they conceal the unethical treatment of the workers stamping these labels.
The shattered image of supremacy and perfection largely synonymous with these luxury fashion houses has paved the way for counterfeiters to invade the market. These problematic supply chains not only undermine the brand’s reputations of quality, but result in a production process that is susceptible to outside duplication. And replicas are getting better than ever. Gone are the days of back-alley purchases and the “undercover” image of the counterfeit industry. Now, consumers are turning to Reddit forums, TikTok accounts and industry experts to uncover the best quality dupes, comparing stitching, prices and eerie similarity. These users are discussing super fakes: replicas that are extremely high quality and can only be distinguished, if at all, by trained experts through rigorous inspection. Brands such as Moncler and Chanel have even experimented with retiring authenticity cards for microchips in an attempt to beat counterfeiters. Virtually any design is vulnerable to replication immediately after reveal, leaving brands with the responsibility of generating enough value to justify an unknown commitment to legitimacy to which only the consumer themselves is privy.
As the line continues to blur between the looks, quality and ethics of counterfeit versus legitimate luxury products, the choice between the two becomes increasingly complicated. Customers begin to question the importance of brand identity and whether allegiances to loyalty and authenticity are worthy of not only astronomical prices but compromised standards. Many moral concerns are raised–intellectual property violations, artistic theft and shady supply chains–that have long discredited luxury counterfeits in the eyes of consumers. Ultimately, it is difficult to influence the purchases to be made when no one is watching, to uphold the value of the real against the fake.