In a holiday season brimming with finicky shoppers, aggressive markdowns and tough competition, retailers are facing pressure from the counterfeit and knockoff market — especially in jewelry, accessories and apparel.
Based on holiday sales projections and worldwide counterfeit statistics, WWD estimates that sales of counterfeit apparel and accessories could account for as much as $32 billion this holiday season and, according to experts, are trending up 6 percent over last year.
Major metropolitan markets in the U.S. are the most problematic, and New York leads the pack as tourists flock to the city during the holiday shopping season. Online sales of counterfeits and knockoffs also are making life difficult for brand owners and their retail partners.
Brand owners are acutely aware that holiday shoppers generate a good portion of counterfeit sales each year. "Most trademark owners ask for extra enforcement efforts from the NYPD as well as from the attorneys who run their civil programs [around the holidays]," said Brian Brokate, partner at Gibney, Anthony & Flaherty, a New York firm that does anticounterfeiting work for clients. "The goal is to cut down on the number of counterfeit items viewed on the streets as well as in places like Chinatown, so that the customer for the legitimate product is not bombarded with counterfeit versions of the genuine items."
The global counterfeit market has shown no sign of abating in recent years. Counterfeit goods account for an estimated $600 billion in annual sales worldwide, according to industry organizations.
Apparel and accessories accounted for 45 percent of the counterfeit goods seized by the U.S. Customs and Border Control at midyear of fiscal 2006. New statistics are due out soon from Customs, but figures so far for the second half of 2006 show that apparel, footwear, handbags, wallets, backpacks and computer hardware were the top commodities seized by value, according to a Customs spokeswoman. An estimated 75 percent of goods seized originated in China.
"Intellectual property rights are a growing problem and we are very concerned with seizing goods that violate intellectual property rights," she said.
Sales of counterfeit apparel and accessories mirror seasonal shopping patterns. Because people are doing more shopping in general, especially for watches, shoes, handbags and jewelry, which are common counterfeit targets, sales of the fake brands naturally increase around the holidays, said Travis Johnson, associate counsel for the International Anticounterfeiting Coalition. Shoppers' habits don't change just because the holidays roll in, he pointed out.
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