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First of all it is important to say that there are two types of counterfeit product purchases by consumers. Deceptive counterfeiting takes place where the consumer does not know that they have purchased a counterfeit product. In contrast, non-deceptive purchases of counterfeit products take place where the consumer willingly buys the counterfeit products. We’re dealing here with the latter type of purchase. If lawmakers and the producers of genuine branded goods want to take action against counterfeits as well as dealing with the suppliers they may need to consider why the demand exists. Much in the same way as health campaigns against cigarette smoking were based on understanding the various reasons why people smoke, so it is also clear that the consumption of counterfeits is a complex activity which has many causes that need to be understood.

There has been a significant amount of research into why people buy counterfeit brands and the types of people who may be more willing to buy them. Unsurprisingly people who have relatively little regard for the law will be more likely to purchase counterfeit products. Also people who have negative attitudes towards big business are more likely to buy counterfeit products. This may be because they feel that genuine brands charge unfair prices, those people who see themselves as being shrewd shoppers willing and able to beat the system may also be more likely to buy counterfeits. Counterfeits may also appeal to those people who want to demonstrate their status, but don’t have the funds to do so with genuine products. Another factor that may encourage counterfeit consumption is where people are curious and want to experiment. Some people are also comfortable with taking risks and doing something that is illegal may not be a problem.

"an individual’s crime may not be obvious to those around them"

As an illegal activity, what is peculiar about buying and using fake brands is that this is something where an individual’s crime may not be obvious to those around them. The consumer knows of their true origin, the people amongst whom the consumption takes place will only know if the consumer tells them, depending on the quality of the manufacture. So are counterfeit brands popular because they are difficult to distinguish? Or is it because there is a cachet to having bought something much cheaper than the genuine product (even if it is fake)?

The most obvious factor motivating consumer purchase of counterfeit products is their relatively low price but it is commonly appreciated that such products will be of lower quality than genuine products. However some research has found that people who have previously bought counterfeit goods believe that they are as good as genuine products – no doubt that will encourage them to repeat their actions.

Clearly the manufacturers of branded goods have a great deal of work to do when it comes to consumer perceptions of counterfeit goods and the attractiveness of buying them.

Weblinks

• Fake football shirts - Can Umbro stop the flood?
• Securing your brand – how do you build value into a brand and how do you preserve that value?
• Take it further - sharpen up your business skills
• Join the discussion - why do people buy fakes? Is it really such a bad thing?

Further reading

• Counterfeiting Exposed: Protecting Your Brand and Customers by David M. Hopkins, Lewis Kontnik and Mark Turnage, published by John Wiley & Sons

Courses

• Marketing in a complex world

About the author

Haider Ali is a lecturer in marketing at the OU Business School. He has extensive experience of delivering courses to people in industry ranging from the most junior functions in organisations to senior executives.

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Blogging about

Money Programme

Get the facts behind the big business and finance stories from around the world – and down your street, in The Money Programme.

Has Kim Winser identified a new direction for Aquascutum? Relying on its traditional lines and existing customers is unlikely to change the fortunes of this troubled retailer.

When a new leader joins a company in turmoil, everyone looks to them to establish a renewed sense of direction and purpose. Carlos Ghosn, Chief Executive of Renault-Nissan, is celebrated as a “rock star” of the car industry. He's credited with rapidly transforming Nissan's financial fortunes. The Japanese carmaker was losing six billion dollars in 1999, but has earned at least four billion dollars every year since 2003. Ghosn's vision of profitability at Nissan was supported by plans to:

• enter new markets
• bring out new models
• boost sales in the US

A favourite question for debate in this area is, of course, are great leaders born or made? Is leadership all about having charisma, or other exotic personality traits?

No, says John Kotter, an expert on leadership and change. Kotter draws a clear distinction between leadership and management, which he sees as two distinctive and complementary systems of action. So what's the difference?

Kotter argues that while managers cope with complexity, leaders cope with change. Leaders set out a vision for the future and the strategies that will move the company in the right direction.

Above all, successful leaders never underestimate the need to get people behind the vision - or the effort and energy required at this stage. A leader needs to communicate his or her vision widely to staff, and ensure that people are committed to it.

"Great leaders keep people motivated"

Great leaders keep people motivated, inspired, and moving in the right direction! This is no mean feat, particularly in a large organisation. In a recent interview, Idris Jala, currently attempting a business turnaround at the struggling Malaysia Airlines (MAS), wondered how “you go about influencing over 20,000 people”.

This brings us to the crucial role played by the managers who support visionary leaders like Ghosn, Jala or Winser, and help to implement the changes required throughout the organisation. A manager (in contrast to a leader) should be concerned with developing the organisation's capacity to action the plan that the leader's setting out. So the management task is all about activities such as organising and staffing, planning and budgeting, controlling and problem-solving.

So Winser needs to set out her vision, and surround herself with a strong management team to help her achieve it. But what obstacles might still be lying in wait for her?

Perhaps we should leave the final word to Idris Jala, still wrestling with a dire financial situation at Malaysian Airlines. One of his principles of business turnaround, he says, is “divine intervention”. In other words, a large number of the things that happen to us in life are beyond our control. So maybe Kim Winser should simply be praying for rain?

Further reading

• Transforming Aquascutum – will Kim Winser be able to transform Aquascutum into a profitable fashion brand?
• Women as leaders – discover how discrimination led to a leadership revolution
• Manager at Work: Remaking MAS
• “What Leaders Really Do” by John Kotter, in Harvard Business Review, May 1990
• What Leaders Really Do by John Kotter, published by Harvard Business School Press
• Turnaround: How Carlos Ghosn Rescued Nissan by David Magee, published by HarperCollins

About the author

Maureen Meadows is a Senior Lecturer in Management at the Open University Business School. Her research interests include the use of tools to support strategy development in organisations, including scenario planning and visioning.

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Blogging about

Money Programme

Get the facts behind the big business and finance stories from around the world – and down your street, in The Money Programme.

The pace of life seems to be quickening, people complain of working longer hours, and some surveys have shown a decline in work satisfaction in recent years, largely as a result of the perceived time pressure. However comparisons with time distribution half a century back suggests that the major change is that time that used to be devoted to chores is now spent watching TV, rather than necessarily working longer hours!

The question is does devotion to work and money make us happy? It seems not. Above a certain minimum income, currently around £10,000 per annum, wealth has remarkably little effect on happiness ratings. GDP has more than doubled since the mid 1970s, but the number of people rating themselves as very happy has remained pretty constant since the 1950s.

Of course there are variations across countries. The proportion of those satisfied with their life rises in countries like Scandinavia where inequality in income is least and personal autonomy is considerable. It is lower in the former communist countries where freedom may be more limited and there are considerable differences between the rich and poor.

"Relationships are the critical factor"

If hard work and wealth does not necessarily increase our well-being, what does? Research shows that relationships are the critical factor. On average married people rate themselves as happier than those that are single, as do people with many friends compared with the more isolated. The socially embedded live longer and recover quicker from illness than social isolates. So if you want to be happy keep up the social network!

We need to bear in mind that people have different capacities for happiness. Extroverts for example, consistently rate themselves as happier than introverts. Psychologists estimate that innate tendencies can account for as much 50% of the variance in happiness ratings between individuals. They also say that our level of happiness normally remains pretty similar throughout life. Even after good fortune such as winning the lottery or a misfortune such as a bad accident people generally revert back to their normal level of happiness surprisingly quickly, often within a year.

Nevertheless there are a number of things we can do to draw out well-being. We have already discussed the importance of developing and maintaining satisfying relationships. Another factor is the extent to which people are actively engaged with life. Those who do things they like and/or find meaningful tend to be more satisfied than those who rarely do things they value.

Some studies suggest that it is more satisfying to be actively absorbed in areas in which we are intrinsically motivated and where we get feedback on our progress, such as gardening, dancing, playing golf, surfing, looking after children and cooking than with activities that are more passive, such as watching TV. However watching TV for 50 hours a week is surprisingly common in the UK and the US, though the number of hours watched is falling among the young who spend more time on the internet.

To enhance well-being, watch less TV and get actively involved in something you enjoy and value. Note that almost any work offers the opportunity to do something well and engage helpfully with others.

"There are plenty of happy secretaries and unhappy CEOs"

It is the attitude that a person brings to their work and life rather than the type of work they do and, normally, the situation they find themselves in, which governs their satisfaction levels. Outward achievement is not necessarily the answer; there are plenty of happy secretaries and unhappy CEOs. It can help to remember to count your blessings and avoiding spending too much time ruminating on the empty half of the glass.

The 24 hour culture has benefits. Quite a few studies show people who work part of the time at home rather than in the office are more productive. They also have the satisfaction of saved commuting time to devote to family, partners and friends, the relationships that are so important to well-being. If you are disciplined, asynchronous communication also affords the possibility of answering emails and voicemail at a time of your choosing.

Well-being is enhanced where workers have some flexibility over when and how they work and where they maintain a work-life balance that provides time for themselves and their family as well as work. People vary widely as to what that balance is. One study found half the leaders worked weekends and half not, yet both groups were equally happy with their work-life balance.

Further reading

• 'The Positive Organisation' by Jane Henry in the The Psychologist, 2003
• 'The Healthy Organization' by Jane Henry in Research Companion to Organizational Health Psychology by C Cooper & A Antoniou, published by Edward Elgar Publishing
• 'Strategies For Developing Well-being' by Jane Henry in A Life worth Livingby M Csikszenmihalyi, published by Oxford University Press
• Creative Management by Jane Henry, published by Sage
• Creative and Perception in Management by Jane Henry, published by Sage
• 24 hour working – discover what’s driving our long hours culture, and its impact on our health
• The price of parenthood – having children brings many changes

About the author

Jane Henry is an applied psychologist. She chairs the Open University Business School Creativity, Innovation and Change programme.

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