Effects of Counterfeit Products on Luxury Brands

This research investigates the effects of counterfeit products on luxury brands, with a focus on Louis Vuitton. It explores the concept of counterfeit products, their impact on luxury brands, and potential solutions to improve brand performance. The study aims to analyze the meaning of counterfeit products, evaluate their impact on luxury brands, and recommend solutions to overcome the challenges. The research design involves qualitative research using secondary data, and the methodology includes a literature review and data collection from online sources.

PROJECT PROPOSAL AND
PLAN

CONTENTS
Title..................................................................................................................................................1
Background......................................................................................................................................1
Aim..................................................................................................................................................1
Objectives........................................................................................................................................1
Research questions...........................................................................................................................1
Rationale......................................................................................................................................1
Significance.................................................................................................................................2
Scope............................................................................................................................................2
LITERATURE REVIEW................................................................................................................2
Theme 1: Concept of Counterfeit products.................................................................................2
Theme 2: Impact of counterfeit product on luxury brands..........................................................3
Theme 3: Solution for the challenge in order to improve brand performance............................4
RESEARCH DESIGN AND METHODOLOGY...........................................................................5
RESEARCH PLAN.........................................................................................................................7
RISK MANAGEMENT..................................................................................................................8
REFERENCES................................................................................................................................9

Title
An investigation on the effects of counterfeit products on luxury brands: a case study of Louis
Vuitton
Background
Louis Vuitton is a luxury brand company who has bene headquarter in Paris, France. They
are being involved in selling a high amount of luxury goods including bags, shoes, perfumes,
jewelleries, accessories and sun glasses (Purwanto and et.al., 2019). It has been analysed that the
rise of counterfeit products can potentially cause businesses to experience an increase in costs, as
well as the loss of productivity. This is because of the reason that brand is selling expensive
fashion accessories which is not affordable by everyone, so there are chances that people buy the
first copy of same thing in lower prices. This can lay impact on performance of brand and also
can create high competition for them.
Rationale
The main reason for carrying out this research is that Counterfeiting is affecting the markets
of luxury brands like Louis Vuitton which is a luxury brand for products like bags for males and
females and it was founded in 1854 in Paris (Hawkins, 2020). These products are affecting their
brand performance. It has been analysed that from fake hand bags to mock sunglasses,
counterfeit products have ill effect on the other brand. It is the largest growing underground
industry and lots of people are involved in buying the counterfeit products. This has resulted into
falling profits of organisation (Moon and et.al., 2018). The lucrative market of counterfeit
products is affecting fashion companies like Louis Vuitton. Their profit has been lowered down
and cost is being increased because of the counterfeit product. The counterfeit products account
for half a trillion each year. Revenue is being lost and also negative reputation is being created
because of the counterfeit products. For this company needs to think of better solution so that
their brand performances cam be increased and also they will be able to achieve the set target
and objectives.
Significance
This topic is really important and need to be discussed as counterfeit products are severely
impacting performance level of counterfeit and also brand value of luxury company is also
affecting. It has also been analysed that in the counterfeit products which is purchased by
consumers, they receive lower quality products and also value of cost is not been created. They
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can also receive damaged and broken goods when buying the counterfeit products. It has also
been analysed that counterfeit products are attracting large number of consumers towards
themselves (Moon and et.al., 2018). This is because of the reason as they want to show their
class. This attitude of consumers is lowering down the profitability of luxury brand.
Scope
Scope of the topic is really broad, as the counterfeit products can have severe negative
impact on working of luxury brand. It has been analysed that counterfeit of Louis Vuitton is
making the luxury products affordable to consumers and this is severely affecting brand value. It
has also been analysed that because of this reason the revenue of luxury goods company is
coming down. Brand is getting hugely affected as because of this anyone can buy counterfeit
product of Louis Viton and this is affecting the volume growth of Louis Viton (Davidson,
Nepomuceno and Laroche, 2019). This is because they are investing so much to provide high
quality products and also to build up brand reputation of their own. This is severely affecting the
popularity of Louis Viton and they do not want this to happen.
Research Questions, Aims & Objectives
Aim
To determine the effects of counterfeit products on luxury brands and potential solutions to
improve brand performance.
Objectives
 To analyse the concept related to counterfeit product
 To evaluate the impact of counterfeit product on luxury brands
 To recommend solution for the challenge in order to improve brand performance.
Research questions
 What is the meaning of counterfeit product?
 What is the impact of counterfeit product on luxury brands?
1. What are the solution for the challenge in order to improve brand performance?
LITERATURE REVIEW
Theme 1: Concept of Counterfeit products
According to Harun and et.al., (2020) counterfeit products are the goods which are duplicate
or first copy products of the luxurious brand. High number of consumers are attracted towards
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these types of goods because they can afford counterfeit products at an affordable prices and
because of this they can show their class in front of other people (Long and Vinh, 2017). It has
been analysed that counterfeit products are affecting the revenue of luxurious brands. This is
because consumers buy first copy at an affordable price instead of the original one. It is creating
challenges for the company and also because of this they will not be able to get over return on
investment. Brands are getting affected by the counterfeit product as consumers thinks that lower
quality goods are been given to them and also value for money given is not been created. This
can become a severe issue for companies and they need to think of ways to overcome it. These
counterfeit products are affecting volume growth of luxury brands as they are investing so much
in goods in order to make them of high quality.
As stated by Davidson, Nepomuceno and Laroche, (2019) Popularity of brands are also
being decreased because of counterfeit products. In counterfeit products consumers can also get
damaged or lower quality products. Government also loses out an unpaid tax and also large cost
is being associated with the giving intellectual property rights to someone else (Purwanto and
et.al., 2019). The industry of counterfeit products is growing tremendously and affecting brand
value of luxurious company. Counterfeiting goods are basically miss-leading consumers, they
give customer with same imitate products with lower quality and also charge excessive amount
for same (Quoquab and et.al., 2017). Consumers can also be exposed to health and safety danger
while getting the duplicate products. It can affect brand performance and value. They are chances
in future that consumer do not buy from these brands in future, this reducing down profitability
and also the return on investment is been lower down. It can also lower down the value of goods.
Theme 2: Impact of counterfeit product on luxury brands
According to the view of Quoquab and et.al., (2017) Fake or counterfeit products directly
impact luxury brands and their productivity in many different ways. Business of manufacturing
and selling counterfeit products is increasing rapidly. Luxurious brands like Louis Vuitton are
impacted drastically due to sale of counterfeit products. This is majorly because most of the
products and services provided by luxurious brands are costly and middle class or lower middle-
class people cannot afford those products. But brand name and product design of such brands do
attract customers (Hartmann and Apaolaza, 2017). Due to this people readily purchase
counterfeit products. Due to these counterfeit products overall sales of luxurious brands get
impacted. It directly impacts overall revenue of these brands. One of the major impacts of these
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counterfeit products upon brands is negative brand image. It is majorly because most of the
people do not understand difference between counterfeit products and original branded products
so if overall quality of product is not up to the mark then it impacts overall brand image in a
negative manner.
Additionally Hawkins, (2020) explains that, Loss and low revenue results in employee
losing their jobs. Luxurious brands either lower overall salaries of employees or terminate
employees in order to hire new employees who can readily work in lower wages. Hawkins,
(2020) further additionally explains that easy availability and selling of counterfeit products
directly impacts overall relationship of luxurious brands with their customers. Most of the
luxurious brands are spending time on increasing their overall sales and revenue, very few of
them are spending time upon reducing impact of this issue so that overall brand performance can
be enhanced and their relationship with customers can also be maintained.
Theme 3: Solution for the challenge in order to improve brand performance
As per the view of Long and Vinh, (2017) Today it has become important for brands to
focus upon easy availability and selling of counterfeit products so that their overall brand
performance can be improved and this problem of counterfeit products selling can be reduced in
order to reduce negative impact of counterfeit products upon brands. There are various ways
though which overall brand performance from counterfeiting can be improved. QR or barcode is
one of the most effective way though which counterfeiting can be reduced ( Purwanto and et.al.,
2019). Brands can involve variations or noises while printing barcode so that a unique digital
identifier can be developed which is extremely difficult to duplicate. Wherever products are
supplied, barcode should be used for authentication. It can be done with a simple barcode
scanner. Barcode will not only safeguard branded products and brands from counterfeit products
but it will further safeguard customers as well from fake products.
Eisend, Hartmann and Apaolaza, (2017) further explains that, there are many other
solutions though which counterfeitly issue can be resolved. This can be done by focus more upon
real time authentication so that it becomes an easier for consumers to identify real authenticated
products and engage with the brand. Brands should focus upon adopting an efficient supply
chain management system so that they can trace their products and on the basis of this they can
take effective strategic decisions (Moon and et.al., 2018). This will directly help them to increase
their operational excellence. Brands can focus upon creating brand guidelines for all their
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stakeholders so that they can understand ways in which important elements of brand can be used
in order to increase brand positioning and increase overall performance of brand in an
appropriate and effective manner.
RESEARCH DESIGN AND METHODOLOGY
Research type
Research type helps in identifying ways in which a research problem should be resolved
in an appropriate manner. It helps in achieving main aim and objectives of a research in an
appropriate manner (Newman and Gough, 2020). For this research project, research has focused
upon using Qualitative research type. This is because in this research project non-numerical
secondary data will be used for exploring main research problem in an appropriate manner.
Research design
Research design is a kind of a framework as a strategy that helps the researcher in
analysing all the main components or elements of a research in an appropriate, logical and
coherent manner. For this research researcher will be using exploratory research design as it is a
qualitative research in which secondary data will be collected so usage of exploratory design will
help in exploring all the main aspects of research. Exploratory research design whose main aim
is to focus upon exploring main aspect of research area
Research Approach
Research Approach can be defined as a set of actions that are used by researcher for
resolving any kind of research problem in an appropriate and accurate manner. It helps in
reaching to conclusion and answering research questions in an appropriate manner. Inductive
research approach focuses upon implementation of new theory for generation of untested
conclusions. As it is a qualitative research approach in which secondary data will be collected by
the researcher, so in this researcher will be using Inductive research approach. This approach will
be focus upon identifying common themes in data collected for exploration of new phenomenon.
Research philosophy
It is an important part of research methodology as it helps in describing ways in which
data for a research should be collected and analysed (Segura-Robles and et.al., 2020).
Interpretivism research philosophy that focuses upon integrating human interest in research
study. For this research project, researcher will be using interpretivism philosophy as it is
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qualitative research. This philosophy will help in achieving main aim of research project though
secondary data in an appropriate and effective manner.
Data Collection
Data collection method helps in collecting required and appropriate data for study. There
are two types of data: primary and secondary. Second type of data is secondary data. It is a kind
of data that has already been published and is collected though secondary sources like Books,
journal, articles, newspapers, online portals etc. (Segura-Robles and et.al., 2020). For this
research, researcher will be collecting Secondary data as it will help in answering main research
questions. Secondary data for this project will be collected from online portals, articles, books,
Journals, government web portals and from any other sources.
Literature search strategy
This strategy helps in developing steps though which secondary data for literature review
can be collected. Literature search strategy for this research project for collection of secondary
data is as follows:
 First search term for search required data were identified so that these search terms can be
used. Search term used for this project are: counterfeit products, brand image, brand
reputation, counterfeiting, fake products.
 After identifying key words pool of online and offline literature were searched though online
of offline libraries and databases for collection of appropriate literature sources. Online
databases and libraries used for searching appropriate literature are: Google Scholar, Emerald
database.
 Then inclusion and exclusion criteria for selecting appropriate literature were identified.
Inclusion and exclusion criteria help in identifying and selecting recent, relevant, genuine and
authentic data or information which is related to the research topic.
 Last year of publication of selected literature were checked so that only recent years data or
information is selected and used.
Inclusion and exclusion criteria
Inclusion criteria: All the articles or studies that were published in last five years were selected
for this study. Studies that consist of 2 or more than 2 key terms were included. Studies
published in English were included.
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Exclusion criteria: all the studies that were published more than 5 years age were excluded.
Other than this study published in language other than English were not included in the research
project.
Data Analysis
Data analysis is a kind of a process though which collected data can be analysed in order
to extract important information that can be used to answer main research questions in an
appropriate manner. It is important to select appropriate research analysis method in order to
achieve main aim and objectives of a research study (Segura-Robles and et.al., 2020). There are
two types of data analysis methods: thematic and statistical data analysis method. Thematic
analysis is a method which is used for analysing textual data by identifying common themes that
repeat continuously within the data collected. It is mostly used in qualitative research type.
Whereas, statistical analysis is a method which is used for analysing numerical data with the help
of mathematical or statistical methods in which figures, chart or graph are formed for analysing
numerical data for extraction of required important data. As it is a qualitative research in which
secondary data will be collected, so in this, thematic data analysis method will be selected.
RESEARCH PLAN
This research project has been divided into sub task and each of these sub- tasks. In this
timeline time period required for completion of all the sub-task has been specified. Overall time
period required for completion of this project is 8 weeks and time period required for completion
of this proposal is two weeks.
1st
Week
2nd
week
3rd
week
4th
week
5th
week
6th
week
7th
week
8th week
Title selection
Brief project
summary
Research ethics
Checklist
approval
Research
proposal
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Submission of
research proposal
Research project
introduction
Research
methodology
Community of
Practice
Use of Literature
sources
Analysis
Conclusion and
recommendations
Submission
RISK MANAGEMENT
Risk management is one of the most important part of a project as it helps in managing
all kinds of risk in the project. In order to manage and eliminate risk in this project RAID method
will be used for management of project risk. RAID stands for risk, assumption, issues and
dependencies.
Risk: One of the main risks associated with this project is time and resource availability. Time
allotted for this project is less and due to this it has become difficult to collect appropriate
resources for collecting and reviewing review of secondary data.
Assumptions: Due to Current pandemic situation face to face communication will not be possible
so most of the communication for completion of this project with tutor will be done online
virtually or through emails.
Issues: management of time is an issue because finding appropriate secondary data for analysis
and achievement of main research questions is an issue because in less time availability
collection of required resources for analysis in order to complete the project within deadline is an
issue
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Dependencies: time to time feedback from tutor is one of the main dependencies because
feedback received from tutor will help in completion of further task as feedback received from
tutor will help in bringing positive changes within other parts of project.
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REFERENCES
Books and Journals
Davidson, A., Nepomuceno, M.V. and Laroche, M., 2019. Shame on you: when materialism
leads to purchase intentions toward counterfeit products. Journal of Business
Ethics, 155(2), pp.479-494.
Eisend, M., Hartmann, P. and Apaolaza, V., 2017. Who buys counterfeit luxury brands? A meta-
analytic synthesis of consumers in developing and developed markets. Journal of
International Marketing. 25(4). pp.89-111.
Harun, A. and et.al., 2020. Understanding experienced consumers towards repeat purchase of
counterfeit products: The mediating effect of attitude. Management Science
Letters, 10(1), pp.13-28.
Hawkins, M.A., 2020. The moderating effect of need for belonging and communal-brand
connection on counterfeit purchasing. Journal of Retailing and Consumer Services. 57.
p.102250.
Long, H.C. and Vinh, N.N., 2017. Factors Influencing Consumers’ Attitudes towards Counterfeit
Luxury Fashion Brands: Evidence from Vietnam. Global Journal of Management and
Marketing Volume. 1(2). pp.63-76.
Lozova, O., 2017. Research methodology of allegorical decentration of the speaker in secondary
nominations of the object. ScienceRise. 10. pp.16-19.
Moon, M.A. and et.al., 2018. Consumer perceptions of counterfeit clothing and apparel products
attributes. Marketing Intelligence & Planning.
Mungi, A., 2020. Question Bank Research Methodology for Business.
Newman, M. and Gough, D., 2020. Systematic Reviews in Educational Research: Methodology,
Perspectives and Application. In Systematic Reviews in Educational Research (pp. 3-
22). Springer VS, Wiesbaden.
Purwanto, P. and et.al., 2019. Consumer motives for purchasing counterfeit luxury products:
behind the status signaling behavior using brand prominence. Business: Theory and
Practice, 20, pp.208-215.
Quoquab, F., and et.al., 2017. Factors affecting consumers’ intention to purchase counterfeit
product. Asia Pacific Journal of Marketing and Logistics.
Segura-Robles, A., and et.al., 2020. Effects on personal factors through flipped learning and
gamification as combined methodologies in secondary education. Frontiers in
Psychology. 11.
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