Identifying factors affecting the intention to buy counterfeit goods from reputable brands

Dissertation for Master of Business Administration (International Marketing)

Abstract:

Since the brand of any company is considered one of the most valuable intangible assets of that company and a source of income, it can be argued that when a brand is known in the market and achieves success, there is a possibility that it will be counterfeited (Maldonado and Hume [1], 2005). The reality is that fake products from reputable brands are easily available all over the world, including Iran, and encourage consumers to buy these products instead of original products. But the problem is not only the production of these types of goods, but the demand that consumers have for these products. The main purpose of this research is to investigate the factors that consciously increase the intention to buy counterfeit goods from reputable brands. For this purpose and according to the presented model, 6 hypotheses have been proposed. The survey-descriptive research approach is of correlational type. Its statistical population includes final consumers of fake sunglasses, which was distributed using a simple random sampling method. 384 questionnaires were distributed. Library and field methods have been used to collect data. Pearson's correlation test was used to determine the significance of the relationships.

In this research, the effect of the consumer's perceived mental image (such as brand personality, perceived features and perceived benefits), product knowledge, product involvement and perceived risk on the intention to buy fake glasses from reputable brands has been measured. The research findings confirm that there is a direct relationship between product involvement, brand personality, perceived product features and perceived benefits with purchase intention. Also, there is an inverse relationship between perceived risk and purchase intention. There is no relationship between product knowledge and purchase intention.

Keywords: counterfeit product from an authentic brand, brand image, perceived product features, perceived benefits, product knowledge, perceived risk, purchase intention

[1]. Maldonado and Hume

Introduction

In the past, the factors that created value for organizations were mostly physical economic goods or, in other words, tangible assets. But today, many organizations have come to believe that one of their most valuable assets is their product and service brands. In other words, brand position is considered as one of the most valuable intangible assets of a company. Because understanding the effects of customer and brand links, especially in markets that have become increasingly unpredictable, the distinctions between products have faded, and competitive pressures have increased, has become extremely important (Frenier and Yao[1], 1997). Based on this, it is very valuable to empower brands in simplifying customers' decision-making, reducing risk and defining their expectations. A brand name creates value for the customer and the organization and shows why the customer will pay more for a superior brand name. In other words, the brand concept plays an important role in creating long-term benefits for the company, because there is little need for extensive promotional efforts for loyal customers, and they are willing to pay more for the features and benefits of their superior brand. That is why brand name and brand like capital, technology and raw materials play a significant role in creating added value for an organization.

When a customer buys a product, he has actually bought its symbolic values. This is even more the case with products that have become a trusted brand, because they have a high value for customers against the amount paid. When a name or brand is introduced as a reliable brand, it can be understood to some extent the effort and effort of the managers of that organization, as well as the capital and time they have spent to achieve this. When a product or service becomes a brand, it means that it has been able to find a place in the minds of customers based on the behavior of the product and in this way create an identity and an image of itself in the minds of people. On the other hand, there are companies that realize the credibility and value of that brand and market fake goods with the same and sometimes very similar name and logo. As a result, the aim of the present research is an attempt to investigate as best as possible the factors influencing the purchase of fake sunglasses (knowingly) from reputable brands.. In this chapter, after stating the problem and mentioning the importance of the subject, the goals and assumptions of the research will be discussed, as well as the research method and territory, the statistical community, and the theoretical framework of the research will be explained, and finally it will end with the definition of the terms of this chapter. 1980 has been proposed (Keller [2], 2003) and currently we are witnessing tremendous changes in how to understand the influence of brands. The main reason for these developments was that many investors realized that many companies had a valuable asset that was not reflected in their balance sheet. The mentioned asset, which has a great potential to generate profit and thus a high potential to create value for the shareholders, is the company's brand. In fact, the best intangible assets of companies are their brands (Kapferer [3], 2004).   

Nowadays, managers of many companies have realized that their brand is not an absolute and dry concept. Rather, it is considered a valuable asset and wealth for the company. In other words, managers have come to the conclusion that the real value of a company lies somewhere outside of the factory, equipment and tangible assets, and in the minds of the buyers (Aker [4], 1992).

On the other hand, there are groups and people who understand the value of this intangible asset well and are trying to fake it. Counterfeiting has existed in the past, but since the 1970s it has become a major concern for manufacturers who own trademarks (Harvey and Rankin [5], 1985). It is estimated that the value of counterfeit goods in the world market grew by 1100% between 1984 and 1994 (Blatt[6], 1993; Carty[7], 1994). The International Chamber of Commerce has stated that counterfeit goods constitute 8% of world trade (Friedman [8], 1999). At the global level, the sale of counterfeit goods is estimated at about 300 billion dollars (Gentry et al. [9], 2006). Despite the fact that the sale and manufacture of counterfeit goods is considered a crime in some countries such as the United Kingdom and the United States (Bush et al. [10], 1989; Hopkins et al. [11], 2003). Previous research shows that nearly a third of consumers, knowing that the product is fake, buy it, regardless of the consequences of consuming fake goods. Since demand is one of the main drivers of markets, a number of studies discuss consumer demand for counterfeit goods as one of the main reasons for the existence and increasing growth of the phenomenon of counterfeiting (Bian and Velutso [12], 2007; Gentry et al., 2001).

Many studies have investigated the relationship between consumer behavior and counterfeit goods. Academic studies have focused more on the supply side of this issue, while less work has been done on the demand side (why consumers knowingly buy counterfeit goods) (Penz and Stettinger [13], 2005). In this research, we intend to examine the factors affecting the purchase of counterfeit goods from the demand side.

1-3- The importance and necessity of research

Brand as an intangible asset [14] can create a high value for the company. So that in order to gain a competitive advantage in the current business world, creating a strong and reliable brand should be considered as one of the company's strategic goals. Because the manufactured products offered, packaging, design, technology, etc. have changed over time, but its brand is stable and due to its reputation, it can introduce new products to the market and sell them successfully. Therefore, in the new era of marketing, creating, evaluating and managing brand functions has a special place. In fact, before the present era, companies considered the work finished by naming themselves or their products, but fierce competition to expand and conquer markets led to the formation of a new philosophy in the field of marketing, which was the result of a hundred years of free experience. This philosophy, which was unimaginably complex and full of mystery in its institution, was nothing but the brand concept, which is the main factor in the promotion and development of a product or service in the national or global market. Understanding the angles of these new concepts in the field of marketing requires an all-round effort that even requires the support of other sciences, including psychology and sociology.