Why the counterfeit business is booming

If you have purchased sneakers recently, they may not be authentic, such as the Nike Nike 3 and 95. The exact same shoe accounts for approximately 20% of the value of all

counterfeit

products in a global market valued at over $500 billion. and the quantity is increasing. and the quality of fakes has never been better for me, these things are almost one to one and many buyers intentionally choose steel. I think it's pretty close to a real victimless crime. Let's be clear, organized crime is involved, so why the

counterfeit

market? exploded and if the big brands should care, my favorite pair, oh that's so hard, it's like asking a mother to choose her favorite child well.

Tallulah is a sneakerhead with her own style, like millions around the world, this pair of Jordan Fours I have are called classics. The green ones are from 2006 and it was like the first session. I thought I need this in my life and she is lucky to combine her passion with her daily work. We have the Dual Jordan that weighed almost six thousand pounds, that's a shoe that many sneaky heads will never like to hold in their hand or see, so it was a pretty crazy moment, but Tallulah doesn't make or sell sneakers, her job is to sniff the falsifications of which the smile test is a part.

In the authentication process we do also, this has a strong toxic smell which would not be a good sign for us. She works in this secret warehouse specially created by eBay to stop the endless flow of counterfeit products on their platform, from bags and watches, playing cards and shoes, so counterfeit shoes are an everyday occurrence, we see that if a shoe has just been released, You know that immediately the people who make fakes are going to be honest, the legal global sneaker market is already worth more than 100 billion dollars and is expected to continue growing and when products of any kind are in such high demand, this at Often fueling a boom in counterfeits, in general, an increase in listed trade generally leads to an increase in illicit trade simply because more trade is more opportunity for listed trade. and the market is generally growing Footwear has become the most seized counterfeit product in the world, accounting for almost a quarter of all confiscated goods.

He wants to know if I wear my shoes. 49 is really selling dead stock. eBay checks. eBay Authentication. The warehouse is part of a fight. Backed by big brands against the growing epidemic of black market products, my goal is to prevent any inauthentic items from entering the retail network. To date we have authenticated more than one and a half million pairs of sneakers through our facilities; That's an increase of 120 year over year. So what is behind this extraordinary rise in counterfeit products? Perhaps the biggest driver has been the e-commerce revolution over the last decade. E-commerce has been growing rapidly in both the legal and black markets between 2017 and 2019. 56 seizures of counterfeit goods within the European Union were linked to online sales, then the pandemic hit, when transactions and sales E-commerce increased even more rapidly, making fake products of all kinds even more accessible.

Consumers used to rely on bulk shipments from wholesalers and middlemen to street markets, but today buying counterfeits is a lot like buying legal products. Sites like Reddit mean you can order custom packages directly from counterfeiters with just a few clicks. E-commerce completely revolutionized the counterfeiting

business

. Shipments were generally made in large 20 or 40 foot containers. standing containers we regularly seize three four thousand pieces since then shipments are shipped individually by DHL by FedEx by China Post thanks counterfeiters are using e-commerce to further blur the line between legal and illegal retail markets when it comes to selling products fake sneakers some have abandoned the old tricks of the trade now counterfeiters often seek customer satisfaction through transparency and honesty deliberately using the digital sphere to advertise their counterfeiting skills online counterfeiters are incredibly savvy about the technology online sales are your entire

business

, it is your daily bread and you need to To stay at the forefront of technology now, how much would you be willing to shell out for a pair of used shoes?

There is another 21st century trend common in legal retail that is driving the rise of counterfeit sneakers; the resale market in the United States alone is worth it. An estimated $2 billion a year at the top end of investors are trading in rare, authentic sneakers that are sold for profit. Well, now you can walk a mile in Kanye West shoes. The first pair of Yeezys he ever wore is up for auction. This pair. designed and worn by Kanye West set a new auction record when it sold for $1.8 million. People are investing in high-value sneakers. They want something they can put on the shelf and maybe turn around as the value goes up.

It's a bit like a fine wine or an art collection this is a new version of items that people value a lot Brands like Nike deliberately restrict supply in certain lines to generate publicity and demand this demand for rare and authentic products has created a demand for high quality fakes consumers are ready You have to pay good money for good fakes. We've been seeing a lot of fakes lately and they're getting a lot of the good stuff from the photo shoot, with the value of the sneakers at an all-time high. Fake producers are making sneakers of this type. one-to-one quality, like eBay and stockx, but authentication labels on sneakers, but now counterfeiters are even copying those labels, some more credibly than others. look at the color look at the color this was a little more lime green this is like a mint green online influences like this are found all over the web and just as influencers have become an important way for retailers to push legitimate products, They have also become a major force in driving consumers towards fakes, to me these things are very close to one to one, I mean in my opinion those who have caught some of these influences have millions of followers and their videos have had millions of views, they feed hungry consumers, details on the quality and varying costs of the fakes on sale, they look like really nice shoes, even the fake ones.

I can go online and buy a pair like this that looks like the real thing. I could get them now. You know, this is a little advertising for the real ones. We have some horribly fake ones like these. Some argue these insiders. Counterfeits provide a much-needed service to consumers. Replicas or representatives, as they are known, are often simply more affordable for buyers. No one should pay a thousand dollars for a shoe that's supposed to be from Nike and buy it somewhere else. I don't think that's right, but if you're buying reps to use because you can't afford them or don't want to spend that kind of money, that doesn't bother me when it comes to consumers buying a replica they know. being a replica, I think it's pretty close to a victimless crime and the consumer is not harmed by definition and possibly benefits because that person maybe couldn't afford to buy the original, or could only afford to buy the original, but promotion by influencers can only go so far to avoid being removed from platforms like YouTube.

Influencers are careful not to say where fakes can be purchased. I didn't say where I got them from, but it is from a very reputable person and he named it on the representative. The space with the prolific rise of influencers and e-commerce, demand for fake sneakers is unlikely to slow down anytime soon, so what about the shutdown? Supply that is also complicated: approximately 80 percent of the market value of all the fake footwear seen around the world comes from the world's largest manufacturing country. The largest China replica manufacturer in China, as a side note, is actually Pew tan China.

The city of Putian has become the world capital of counterfeit sneaker production, which is partly because Putian also produces the majority of the world's genuine sneakers, providing cover for black market production. . Please finish all your orders before Chinese New Year, thank you, Illegal production has become more closely intertwined with legal production, often within the same factory. Private detective Ted Caveras has witnessed this firsthand by filming undercover footage in factories. It's a kind of urban terrain scale that you I hope in China you drive Factory here Factor here factory here Factor here It also works like your Air Jordan how many machines we have here 500.

In China, fakes generate copies of fakes, this is the original, so they dismantled the sample, if there is a criminal. group that makes fakes will very often be number two or three in the hierarchy. I just learned the business and then set up shop so that a group of counterfeiters can give rise to three or four competitors, although the counterfeiters may look more like normal business people. Concerned about customer service and overhead, they don't always commit victimless crimes. Some counterfeit operators are also involved in more dangerous and serious criminal activities, such as human trafficking. Let's be clear, organized crime is involved.

Very rarely have I had an investigation that hasn't involved some. another type of crime we investigated a group that had been exploiting Ethiopian women who had been trafficked Ethiopian women were being locked in rooms forced to make counterfeit products at night they were forced to take to the streets to prostitute themselves the Chinese authorities have increased their efforts to crack down on black market production and sales and there are ways investigators can use technology to catch counterfeiters. From time to time they want people to know that their reputable sellers have thousands of satisfied customers and the platforms want this too, so there is actually a follow-up. sales records on many of these platforms showing how many products the counterfeiter has sold.

This is a tool we have that we can use against counterfeiters. However, the sheer volume of production in China means there is little hope of shutting down the supply line of fakes, it is a basic law of economics, if there is demand, there will be supply, at a certain point, you can't really figure it out, everything What you can do is occasionally nibble around the edges and eliminate certain vendors, and then another vendor comes along. and it is something inevitable, it is not China's fault, it is the demand from abroad that drives this business in China, so what we have to do is look at who buys it, we have to control it, the customer too and we do it through education or surveillance there.

There is no easy answer to curb consumer demand for brands that want to curb the counterfeit market, in the end there could be a difficult road ahead, it's like inflation, you know, if you and I literally start counterfeiting dollars or pounds, who are we really harming, but in the future? added, it starts to inflate the value of the dollar, we all did that, so it's the same type of dynamic with Brands, it starts to inflate the value of the brand, dilute the value of the brand. Hi, I'm Tom Standage, Deputy Editor of The Economist, if you'd like more information on this topic click the link next to it, thanks for watching and don't forget to subscribe.