Deal-Seekers Easily Duped By Counterfeit Sites, Says MarkMonitor

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Deal-Seekers Easily Duped By Counterfeit Sites, Says MarkMonitor

11/25/2014
MarkMonitor released its latest Shopping Report that examines consumer purchase intent and the demographics of those who acquire counterfeit goods online. Focusing on the digital world of apparel and luxury goods, this study builds upon the initial MarkMonitor Shopping Report that analyzed e-commerce sites and counterfeit goods.

MarkMonitor worked with Nielsen, a global provider of information and insights into what consumers watch and buy, to analyze anonymized privacy-protected data from more than 285,000 of Nielsen's permissioned online panelists in the United States and five European countries in an eight-month period. Nearly nine million shopping sessions for fashion and footwear were surveyed using proprietary MarkMonitor technology during the study period to determine whether shoppers visited sites selling legitimate goods or sites selling counterfeit goods, known as rogue sites. 

MarkMonitor also studied shopper motivation, using search terms as guides. By classifying terms like 'cheap', 'discount' or 'outlet' as bargain-seeking and terms like 'counterfeit', 'fake' or 'replica' as fake-seeking, the team examined the aggregated traffic for shoppers to gauge their interest in shopping for legitimate or fake goods.

The latest study found that the number of bargain-hunters has grown with a ratio of 28 deal-seekers to every one fake-seeker in the U.S. and Europe. This is a substantial increase from the earlier study which found a ratio of 20 deal-seekers to every one seeker of fakes, with the increase most likely fueled by a combination of factors, including economic conditions and the Internet's reputation as a great source for deals. While consumer bargain hunting in digital channels continues, the panelists in the current study appeared to be less likely to stumble upon a rogue site, with a ratio of one in ten bargain-hunters visiting a rogue site versus a one in five ratio in the earlier study.

However, the new study found that once a bargain hunter does encounter a rogue site when seeking a bargain, they are just as likely as shoppers in the earlier study to be duped by the perceived 'quality' of the rogue site with one in six online bargain hunters displaying an intent to purchase.

"Savvy shoppers are continuously looking online for deals and are falling victim to counterfeiters who have camouflaged themselves as legitimate purveyors of desirable goods, changing the rules of the game in brand protection," said Fredrick Felman, CMO of MarkMonitor. "The findings from our Shopping Report stress the importance for brands of developing proactive strategies to safeguard their brands so customer trust is not undermined by illicit digital activities."

Additionally, the MarkMonitor Shopping Report examined shopper demographics, including age, gender, income, education levels, and household size. In both the United States and Europe, the largest segment of rogue site shoppers were in the 31-50 age range (40 percent in U.S. and 43 percent in Europe), followed closely by millennials in the 18-30 age range (30 percent in U.S. and 25 percent in Europe).

In addition, MarkMonitor found that females comprised the largest percentage of rogue site shoppers at 56 percent in the U.S. and 53 percent in Europe. Another area of similarity between European and American rogue site shoppers occurred when examining the presence of children in the household, as 56 percent of the rogue site shoppers in the U.S. did not have children present in the household while 61 percent of European rogue site shoppers did not have children present. 

"In today's digital world, rogue sites can fool even the most experienced shoppers, whether an aspirational consumer or a brand loyalist," continued Felman. "Brands that take steps to ensure that brandjackers do not come between them and the consumer realize a positive return on investment across all channels."

With the holiday season right around the corner, consumers must be vigilant when shopping online. Many counterfeit goods are priced to appear as legitimate goods on sale, often discounted at 25–50 percent off the legitimate list prices, which is comparable to end-of-season or 'blowout' sale prices. These plausible prices allow bargain hunters to feel they are getting a good deal on legitimate merchandise, especially when coupled with the increasing tendency for rogue sites to feature brands' recent marketing campaigns and photographs.