COUNTERFEIT LUXURY GOODS’ “VALUE”

Kasey Patrick
Summer 2022 A-CAPP Student Intern, Fall 2022 A-CAPP Student Researcher, Double Major: English BA – Creative Writing and Psychology BA, December 2022, Michigan State University

The brand protection community has witnessed a shift in the consumption of counterfeit luxury products among consumers within the latter end of the Baby Boomer (57 to 75 years), Generation X (41 to 56 years), and Millennial generations (25 to 40 years) (collectively “Working Consumers” aged 25 to 65 years). This is in comparison with “young consumers,” aged from 18 to 24 years, often referred to as Generation Z or Gen Z, (Dimock, 2019). In particular, the avoidance of counterfeit goods in today’s Working Consumers is the opposite among the Gen Z population. The older members of Gen Z are known to purchase counterfeit products intentionally, and they are proud of it. This celebratory behavior has not been seen in prior generations, nor is it something that is completely understood by those in the brand protection community. In my view, Gen Z places far more importance on the amount which they can save on the products they purchase, while still being perceived as important by those of higher status. This is achieved through social media to discover and purchase counterfeit luxury goods. Furthermore, they use online platforms to portray themselves as “valuable” in this virtual world. Looking at the psychology of the Gen Z population can lend some understanding of what motivates them to buy counterfeits.

The Influence of Social Media

Members of the Gen Z demographic gain pride and internalize value differently than generations prior. This group has been raised with numerous forms of social media at their fingertips. This increase in virtual socialization has raised the bar for expectations placed upon oneself. Specifically, how an individual is perceived by others, which is a motivating factor in Gen Z’s behavior. A member of the Gen Z population is more likely to act in behaviors purely for economic gain than any group prior. Looking at their own self-interests — saving money — an item’s value is driven by how worthy the item will make others perceive them as an individual. The goal is to remove the barrier of monetary constraints, while still allowing possession of a desired branded product. On the contrary, Working Consumers are far less likely to participate in behavior that is motivated primarily by self-interest, (Gurel-Atay, 2020). Typically, prior generations will give more financially to be recognized in a high social status than the Gen Z group is willing to offer.

Another psychological phenomenon that is observed heavily in this Gen Z era is the fear of missing out; otherwise known as FOMO, (Hyman, 2020). This concept is driven by an individual not wanting to be a part of the “outside” group so badly they interpret those within that group negatively — placing personal worth on being part of the desired, collective group. From my perspective, FOMO drives a substantial amount of consumer behavior in the Gen Z group. An interesting note to this behavior, however, is the eagerness within the Gen Z population to share whatever information is needed to purchase counterfeit luxury goods — particularly with individuals of their same age group. Social media is used as a network for this information to be streamlined from one person to the next. This allowed Gen Z to conceptualize society differently than any generation prior.

While social media is used as a pathway to both purchase counterfeit luxury goods and show off the counterfeit goods as if they were legitimate, the creation and popularity of social media is a large influence on the Gen Z population’s purchasing behaviors. For example, an acquaintance of mine showed me the crossbody purse seen in Figure 1. This purse was purchased through Instagram, after seeing a review and photos of the bag on an influencer’s account. This influencer had the link to this counterfeit purse with a promotional code that allowed purchasers to receive a discount on their purchase. The influencer earns money from those who use their link to purchase the item, promoting the purchasing of counterfeit luxury goods. This individual was shown the influencer’s account through a friend of theirs, who also found it from another friend. This group of individuals all share the same interest in discounted luxury goods. 

Instagram provides a platform for influencers to review items with images to drive their appeal. Individuals with similar interests and in the same collective Gen Z grouping become followers and engage with the influencer — relaying information deemed noteworthy to their peers. The referral links and the advertising of counterfeit luxury goods, through a platform designed for young adults, elicit engagement and the ability to purchase the available products. Through the means of shared connections, Instagram suggests other accounts in which you may share similar interests. This creates an ever-expanding network to sell counterfeit goods — all targeted at young adults. Various accounts, such as the one outlined above, are dedicated to reviewing counterfeit luxury goods, while also providing a plethora of links to purchase any counterfeit item. These products range from fake Louis Vuitton bags, shown in the above example, Cartier and Rolex accessories, to Chanel clothing seen on the runway (Wolfe, 2022).

The Why

Since it is evident that social media has a considerable influence on the consumption and opportunity to purchase counterfeit luxury goods, the next discussion is why luxury items are of such high appeal to consumers (Wiedmann et al, 2007). Here, researchers were able to break down even further the behaviors of those purchasing luxury goods into three groups. The groups are derived from values consumers identify with on Wiedmann’s Model from 2007 (Figure 2). These groupings display the primary motives that drive all luxury consumption — with these groupings being the three primary arcs that a purchaser of luxury goods falls within. Wiedmann’s Model displays all the values luxury goods can appeal to.  

• The first group is high in both the uniqueness value and in snob value (snob value replacing Wiedmann’s conspicuousness value)
• The second group is high in almost all aspects: prestige value, self-identity value, quality value, uniqueness value, and hedonic value.
• The third group is high on quality value, hedonic value, and uniqueness value.

These groups represent the emotional aspects that drive the consumption of luxury goods. The first relies heavily upon the special products that are a luxury — categorized as products that are not mass produced and are not available to most individuals. The second purchases luxury goods for a sense of self-actualization. This group wants to feel accepted by elite society, with acknowledgment of their personal accomplishments. It needs a personal connection to the item, while also having a monetary connection. Lastly, the third group appreciates the quality and label of the luxury brand. They care little about the recognition from higher society, appreciate the luxury piece for the brand’s history, and the uses (not the prestige) the piece can bring them (Srinivasan et al, 2014). 

An understanding of Gen Z’s emotional rationalization of purchasing counterfeit luxury goods is instructive to the brand protection community. The Gen Z consumer chooses to purchase counterfeit items due to the functional value that the piece can provide, while also giving a stronger sense of individualization. Gen Z shares a similar sense of appreciation of brands and the reputation a luxury brand holds. Though, regardless of this, members of the Gen Z population who purchase counterfeit luxury goods are motivated by the external praise a brand’s image provides, rather than the realities that come with a logo. These realities vary from potential financial strain, societal pressures, and other aspects of a social class standard. While perception is important to members of Gen Z, the willingness to hold a counterfeit luxury good with pride is due to the power society has placed on the reputation of the legit brand. This is also why Gen Z members are eager to share information about where to purchase counterfeit items with others in their collective age group. 

The reputation and status placed on luxury items have become engraved in the minds of the Gen Z population through reality television, social media, and societal pressures. Owning an item with the same perceived value as an actual luxury good creates a new narrative for Gen Z members that resonates. It provides them with a sense of value, held legitimately by the older and Working Consumers. Members of the Gen Z population expect to be perceived as motivated, determined, and hard-working — guided by a desire to share the same internal joy with others in the collective group.