What's Happening With Handbags?!
Over the last 2 years, the handbag market has seen its share of struggles. Brands like Coach and Michael Kors have opened new store after new store, more outlet shops, and even lowered some of their prices. This sounds good. Having the numbers to grow your brick and mortar presence is always a good thing. Or is it?
Alone, growing in brick and mortar is good, but the handbag market suffered a bit last year, growing just around 2%. Sure, that's hard to see as a struggle in a $9.3billion industry, but best believe, the brands are feeling it. Some of the reason for the shift is discounting and brand saturation. Other contributors are the trends toward specialty bags--whether it be a collaboration between Kerry Washington and Aquatalia, or a cause-focused bag focused on an important social issue. Consumers are increasingly enjoying putting their money behind a cause, and getting style as an added bonus.
It's hard to think handbags would go out of style. It really is quite unlikely. But, like everything else, there are industry ups and downs. With the rise in e-commerce, retail is experiencing a shift away from traditional shopping. Marketplaces like Amazon and Etsy are providing challenging circumstances for shopping mall staples like Macy's, Wet Seal, and The Limited. Now they've had some real struggles!
Surely in readjusting their prices, and being conscious about bag placement, luxury designers will rebound from this slump they've seen recently. The question is, how will e-commerce and the "app age" play into their future success? Marketing gurus certainly have a challenge on their hands. Retail execs, too.
B.A.F.F.L.E.D. Fashion Law
Designers Focus In On Internet Vigilance--
Many established designers were hesitant to embrace the virtual world. After all, their namesake founders began the collections in small shops or even rooms in their homes. Soon enough, the internet world caught on, and the ease of shopping made for big benefits to seasoned luxury retailers.
Then came the negatives.
Designers must be forever cautious of how they market their brand and where they allow it to be exploited. Just recently, Gucci owner Kering sued China's largest e-commerce brand over harboring fakes on the site. Nearly $82billion is lost annually to designers' fight against fakes. Many designers are putting millions into this vigilance--millions away from the design shop and brand promotion. Although the money is a major factor, let us not forget the disregard for brand reputation, too. It's so similar to one's personal reputation. Guard it with your life.
Many established designers were hesitant to embrace the virtual world. After all, their namesake founders began the collections in small shops or even rooms in their homes. Soon enough, the internet world caught on, and the ease of shopping made for big benefits to seasoned luxury retailers. Then came the negatives.
Despite the plethora of advantages to e-commerce, burdens and disadvantages come along as well. While luxury brands bring customer experience to the fingertips, so too, do counterfeiters and gray market producers. As we've discussed here many times, gray market goods are those produced in legitimate luxury factory settings, but outside of legitimate production terms. Counterfeiters usually take it a step further, producing their own look-alike items. These goods are generally 2's and 3's in the marketplace. Remember the Rating System?
Why Does This Really Matter? Everyone is Making Money?
With so many online squatters, luxury brands are forced to keep up constant vigilance over their brands online. This becomes extremely difficult when the internet is flooded with search terms, improper image use, licensing breaches, and sites changing every single day. But, who cares? The reputable brands get money from their base, and the counterfeit market gets money from their, wholly separate base, right? Nope.
We've discussed the great downside of counterfeits--the funding they provide for human trafficking and other horrible crimes. There is a damage to the designer, too (not eclipsing the trafficking, of course--just separate).
The crime to the brand--whether luxury founded in the 1800s or worked on tirelessly in a university studio this year-- hurts the bottom line. It hurts more, the name; the reputation. The problem here is the compromise to one's rights, image to the public, and invitation for confusion when consumers are looking for the right item to suit them.
B.A.F.F.L.E.D. Fashion Law
How to Spot Fake Merchandise--
This topic has been visited a few times--on this site through various posts, and by some of our fashion law friends. However, a reminder is always good, especially as e-commerce continues to dominate. We want to make sure you're fully aware of what you're buying, and why you shouldn't be buying items not properly sourced to the right designer.Here's some guidance on purchasing the right pieces:
It's improperly placed
If it's not in an approved retailer, is positioned in a mall kiosk, or is sold on a street corner or out of a trunk--it's fake!
The price is too good to be true
Real luxury goods come at a cost. When you enter their stores, they'll tell you you're making and investment, not a purchase. If the price is way beyond right, it's not real. No hardworking designer--established or rising--is short selling their work.
It doesn't look quite right
Does the design look just a tad bit off? Are the letters skewed? Are the letters wrong?! If anything about the item is not right--it's fake. Artists are perfectionists, and they don't let imperfect products hit the market. If an item looks off, don't buy it.
The signs are obvious
This is when logos are incorrect. Trademarks are terribly infringed, and real artistry is compromised. You know you are dealing with a fake when all of the 3 above are present. You can also be sure when the seller can barely give you facts about the brand. Frequenting designer shops--even department stores--you'll find knowledgeable sales associates who know about what their selling. When you can't get a straight story on what you're buying, keep your money.
It's produced in the gray market
Gray market goods skirt the line of infringement. Their crafty, shifty ways to make goods seem legit. They're not. Gray market goods are produced at legitimate factories, but under illegitimate terms. These goods are categorically fake. Don't support them. They're made contrary to the factory's terms with the designer, skim designers of their rightful money, and impair brand quality in the market. How would you want your hard work treated? As Fashion Law Trailblazer Susan Scafidi points out in this news spot on Superfakes, these items often fund organized crime and terrorism.
The Rating System
(1) The real thing(2) The real thing....but the designer finds something about it imperfect for sale
(3) A great fake; looks real, but it's not. We still discourage purchase of these.
(4) A terrible fake. Sellers and buyers should know and do better. Smh.
Be careful when shopping and make sure your purchases are legit on all levels. For more, check out our 3-part series on The Battle Against Counterfeits.
B.A.F.F.L.E.D. Fashion Law
Will Phone Check be the New Coat Check?
We've talked a number of times about the ease of infringement at fashion shows. With New York Fashion Week closing today, it's a good time to think about how NYFW and fashion weeks across the States could be changing. Unlike in Europe, America has no federal protection for fashion designs. The utility argument continues. This brings up the question of how and what designers will do to protect their precious works of art.
New technology as a threat
With technology improving every day, and camera phones being so commonplace, designers could be expected to ban these devices from their shows. Instead of checking your coat, you'll have to check your phone at the door. Press would be allowed in, but forced to sign strict agreements on distribution of the photos they take. It sounds outrageous, but is not far-fetched. Infringement lawsuits are getting filed left and right these days. With the quickness and ease of social media, designs are always in harms way.
Everyone knows attendees quickly take photos of their favorite styles, send them to manufacturers and have them on the racks at places like Forever 21 faster than the original designer can make another for their own collection. We've heard this line so many times before.
Still not having federal legislation to protect fashion designs under copyright--only prints and patterns have this security--designers are constantly looking for something to protect themselves. Otherwise, trademark and design patents are pretty much the only options.
Should cities offer protection? What can they do?
Many say there is no real harm to the lower-priced copies. The shoppers at one price point are not the shoppers at another. This debate will continue. Should fashion week host cities come up with their own solutions? Would you surrender your phone at the door of a fashion show?
What are your thoughts?
B.A.F.F.L.E.D. Fashion Law
Happy Birthday Fordham Fashion Law Institute!!
Not too long ago, fashion law was a twinkle in our eye. And now the Fashion Law Institute, a landmark fixture in the industry, is turning 2 years old! We are so excited about this feat. For those of us who love fashion law, we know how important this is.
Our fashionable trailblazer in fashion law, Susan Scafidi, set out to make this Institute her baby, and has taken it all the way down the catwalk. I got the privilege of visiting and was beyond amazed at what she has put her stiletto print into. Glamorous kudos to her!
In addition to being the author of Counterfeit Chic, she is also the brains and fashionable attorney/Academic Director behind the Fashion Law Institute at Fordham Law School. For years, so many of us just wanted a class on fashion in law school--now, we have an entire Institute. The Institute offers a clinic, bootcamp, and help to the fashion district, and seminars for practicing attorneys living and loving the field. It also happens to be located right in the Fashion District. How perfect!
Happy Birthday!!
Not too long ago, fashion law was a twinkle in our eye. And now the Fashion Law Institute, a landmark fixture in the industry, is turning 2 years old! We are so excited about this feat. For those of us who love fashion law, we know how important this is.
Our fashionable trailblazer in fashion law, Susan Scafidi, set out to make this Institute her baby, and has taken it all the way down the catwalk. I got the privilege of visiting and was beyond amazed at what she has put her stiletto print into. Glamorous kudos to her! In addition to being the author of Counterfeit Chic, she is also the brains and fashionable attorney/Academic Director behind the Fashion Law Institute at Fordham Law School. For years, so many of us just wanted a class on fashion in law school--now, we have an entire Institute. The Institute offers a clinic, bootcamp, and help to the fashion district, and seminars for practicing attorneys living and loving the field. It also happens to be located right in the Fashion District. How perfect!
Happy Birthday!!
B.A.F.F.L.E.D. Fashion Law
The Root of Fashion Week...is Fashion Law--
Clearly, questioning the validity of fashion law is fading. There was a time when "fashion law" got blank stares and/or a series of questions. That response is escaping, as it should be. Today, with fashion being such a major focal point in our economy and everyday lives, people understand what it is and why it's needed.
The root of fashion law goes back to the start of fashion in general--likely the times when Sir Charles Fredrick Worth began putting tags with his name on it in the dresses he designed. As we continue in excitement about New York Fashion Week, we can point to fashion law as its source. We mentioned Dressing Constitutionally as a new must-read for legal fashionistas. Now, Intellectual Property at the Edge: The Contested Contours of IP, a book edited by professor Jane C. Ginsburg of Columbia Law School, is due out this year.
The new book includes a chapter by Columbia Professor C. Scott Hemphill. He discusses the start of the Fashion Originators' Guild of America--a union of designers working together to keep their designs protected. They agreed not to work with entities who infringed on the designs of members, thereby supporting the counterfeit and knockoff market. You can even see some of their authorized labels here. In 1941, the U.S. Supreme Court denied their attempts at protecting themselves as violations of antitrust law.
Despite the ruling of the Court, the Guild's seasonal shows of their original work strolled on. This was not only their way of showing their stuff, but letting everyone know it belonged to them. It was also the mother of the modern-day New York Fashion Week.
“The Fashion Originators’ Guild of America: Self-Help at the Edge of IP and Antitrust,”, Professor Hemphill's chapter in the book takes a deeper look into the court case, antitrust issues, and where protection of fashion designs currently lies. See, fashion law is not only real, but more established than you'd think.
Can't wait to read this one!
B.A.F.F.L.E.D. Fashion Law
The Battle of Counterfeits in Big Cities, Part 2--
Last week we talked about the fight big cities are having against counterfeits. Places like Chicago, New York, and Atlanta--largely because of their transportation centers--are consistently working to keep the counterfeit market in check within their borders. Today, we're going to talk about how the counterfeit chain begins.
How do counterfeits come to the market in the first place?
Counterfeits are considered products purporting to be part of a popular designer brand, but sold in what we'll call a shady way. Designer items are sold directly from their source, or through licensing agreements permitting items to be sold in other outlets. An example of such licensing would be Christian Louboutin shoes being sold at Bloomingdale's. Bloomingdale's has an agreement with Louboutin allowing them to sell their shoes in the store.
What happens in the counterfeit market is contrary to direct sales or licensing agreements. Items which look a lot like the real deal show up in places the designer has not authorized, and the price is always far less than the true value or market price of the item. Often, counterfeits circulate through the market innocently, when consumers buy them from sources they trust, like friends having "purse parties" or donations to charitable organizations. However, the source to these innocent consumers is far from innocent. They may start at a place like Canal St. in NYC or boutiques claiming to have deals on designer items. The items come in in droves. Here's how the chain starts.
Gray Market Production
We know the black market is where items are sold illegally. Well, the gray market is somewhat similar. The gray market is created when factories licensed to produce designer goods under certain terms and conditions step outside those boundaries and create their own, infringing items.
As an example, a factory is licensed to produce Chanel bags under the protocol provided by Chanel. Bags are to be made from 9am local time to 5pm, using specific materials and methods. At 5:30, the production continues, but the items are 1) unauthorized by Chanel, and 2) produced in such a way to make consumers believe the goods are Chanel, but protect the infringing bag-maker from a quick infringement, contracting, and licensing lawsuit. The goods get shipped, and in the best cases, they're stopped at customs to protect designers and consumers from infringing products. No worries, the lawsuit does come later.
This gray market method is one of the largest sources of counterfeit goods and is the baseline of a billion-dollar market. To curb the negative effects of this market, a myriad of things must be done: legislation, brand vigilance, accurate contracting, policing, and more.
Share with us how you feel about counterfeits, fakes, and knockoffs. Let's keep the conversation going.
Stay tuned for more on international production and fashion labor.
*Designer goods is a fairly loose term when used in this article. It does not describe high priced goods only, it includes items at any price point, but specifically those protected by a trademark or brand recognition in some way. Price is not a factor.
Last week we talked about the fight big cities are having against counterfeits. Places like Chicago, New York, and Atlanta--largely because of their transportation centers--are consistently working to keep the counterfeit market in check within their borders. Today, we're going to talk about how the counterfeit chain begins.
How do counterfeits come to the market in the first place?
Counterfeits are considered products purporting to be part of a popular designer brand, but sold in what we'll call a shady way. Designer items are sold directly from their source, or through licensing agreements permitting items to be sold in other outlets. An example of such licensing would be Christian Louboutin shoes being sold at Bloomingdale's. Bloomingdale's has an agreement with Louboutin allowing them to sell their shoes in the store.
What happens in the counterfeit market is contrary to direct sales or licensing agreements. Items which look a lot like the real deal show up in places the designer has not authorized, and the price is always far less than the true value or market price of the item. Often, counterfeits circulate through the market innocently, when consumers buy them from sources they trust, like friends having "purse parties" or donations to charitable organizations. However, the source to these innocent consumers is far from innocent. They may start at a place like Canal St. in NYC or boutiques claiming to have deals on designer items. The items come in in droves. Here's how the chain starts.
Gray Market Production
We know the black market is where items are sold illegally. Well, the gray market is somewhat similar. The gray market is created when factories licensed to produce designer goods under certain terms and conditions step outside those boundaries and create their own, infringing items.
As an example, a factory is licensed to produce Chanel bags under the protocol provided by Chanel. Bags are to be made from 9am local time to 5pm, using specific materials and methods. At 5:30, the production continues, but the items are 1) unauthorized by Chanel, and 2) produced in such a way to make consumers believe the goods are Chanel, but protect the infringing bag-maker from a quick infringement, contracting, and licensing lawsuit. The goods get shipped, and in the best cases, they're stopped at customs to protect designers and consumers from infringing products. No worries, the lawsuit does come later.
This gray market method is one of the largest sources of counterfeit goods and is the baseline of a billion-dollar market. To curb the negative effects of this market, a myriad of things must be done: legislation, brand vigilance, accurate contracting, policing, and more.
Share with us how you feel about counterfeits, fakes, and knockoffs. Let's keep the conversation going.
Stay tuned for more on international production and fashion labor.
*Designer goods is a fairly loose term when used in this article. It does not describe high priced goods only, it includes items at any price point, but specifically those protected by a trademark or brand recognition in some way. Price is not a factor.