A RESEARCH REPORT On

Counterfeit of luxury good

In Partial Fulfillment Of The Requirement Of The Subject Research design for management first semester division-A of Master Of Business Administration

SUBMITED TO: - Prof. Jayesh Patel

SUBMITED BY: -Kinjal M.dave -Jayesh N. desai -Mayur T. desai -Neepa M.gajjar

V. M. Patel Institute of Management

Preface
The key for achievement your goals in life is to work with enthusiasm and you should have burning desire to learn, to explore, to experience and face challenge in life with positive attitude.

I am the student of MBA. As a part of curriculum of subject research I have read many books and search from the internet and get many resources to prepare our report. Also filled up questionnaire for analysis of factor influencing consumer behavior while purchasing bike.

In writing this report we have drawn vast amount of the information, data from the various senior persons and simultaneously support by various other people. It gave us an edge for improving our management knowledge and writing skills and to learn various aspects. 3

Acknowledgement
It was indeed an opportunity for us prepared report on the same during our MBA program, first sem. Research design management subject. Preparation such kind of report, requires lots of searching and collecting of data from many sources like internet, books, and other people. During the preparation of this report have read many books and search from the internet. Also we have taken help from our senior students. We are very glade to prepare this kind of report. We would like to thank Prof. Jayesh Patel, who took adequate care & effort in searching books, magazines, journals, etc. so that we could complete our project smoothly and well in stipulated timeframe. Last but not the least: We would like to cite our beloved all our friends for their and encouragement, support and blessings. These pages could scarcely have been written without their help. We express our gratitude to the staff members of V.M. Patel Institute of Management, who directly or indirectly helped us. 4

Declaration
We undersigned a student of MBA Sem-1st hereby declare there the project work presented is report is my own work and has been carried out under the supervision of Prof. Jayesh Patel of V.M Patel Institute of Management. To the best of our knowledge these works have not been previously submitted to any other university for any examination by any student.

NO.

SUBJECT Preface Acknowledgement Declaration

PAGE

1 1.1

Introduction Background

Review of literature

3 3.1 3.2 3.3 3.3.1 3.3.2 3.3.3 3.3.4 3.5 3.6 3.7 3.8 3.9

Research Methodology Objective of the study Research Design Sampling Design Target population Sampling Method Sampling Size Execution Measure of the study Tools for a data collection Scale used in data collection Summary Hypothesis

4 5

Questionnaire Bibliography

Chapter- 1 Introduction

The practice of product counterfeiting high-visibility, strong brand-nameluxury consumer goods is a major problem. According to the InternationalChamber of Commerce, global losses from

counterfeiting of luxury brands as well as other consumer goods amounted to more than $200 billion in 1996and counterfeit products accounted for 5 percent of world trade (NillandShultz, 1996). In addition, lost revenues and jobs are the immediate damages, as in 1993 alone, the US Customs Service projected that total USjob loss due to product counterfeiting was 750,000.Past research has examined the demand side of product counterfeiting (Blochet al., 1993; Cordell et al., 1996; Wee et al., 1995); the consumption habits of the affluent (Stanley 1988; 1991); or the stages luxury brands go through before being fully accepted by consumers (Dubois and Paternal, 1995).

However, no prior work has examined the attitudes and reactions of consumers of genuine luxury goods towards counterfeits. It is important to distinguish between the two types of transactions involved in counterfeiting: namely, deceptive and non-deceptive. Grossman and Shapiro (1988a)identified deceptive counterfeiting as a situation in which the consumers arenot aware of purchasing a counterfeit product at the time of the purchase. Another words, consumers believe they are purchasing the genuine product. They indicate that deceptive counterfeiting can be observed mainly in markets for automotive parts, consumer electronic products such as computers and stereo equipment, pharmaceuticals and medical devices.However, in many cases, and especially in the luxury brand market, consumers are involved in non-deceptive counterfeiting. This is a situation in whichconsumers are fully aware that the product purchased is a counterfeit product atthe time of purchase.

Counterfeiting in ChinaThe International AntiCounterfeiting Coalition (IACC) hasestimated that counterfeiting is responsible for at least $200billion a year in lost jobs, taxes and sales (FurnhamandValgeirsson, 2007). In particular, China has beenacknowledged as the worlds most notorious country for counterfeiting, where all sources of counterfeit goods can betrayed (Hung, 2003; Forney, 2005; Cheung and Prendergast,2006; Bian and Veloutsou, 2007). It has been recorded that20 percent of goods sold in the Chinese market are counterfeit goods (Alcock et al., 2003; BianandVeloutsou, 2007). Thesegoods span across a wide range of products including apparel,cigarettes, electronics, food, mobile phones, pharmaceuticals,skin care products and many others (Bush et al., 1989; Jacobset al., 2001; Trainer, 2002). In particular, as the Chinese areavid consumers of luxury goods (Wong and Ahuvia, 1998;Jiang, 2005; Somezand Yang, 2005; Li and Su, 2007), the counterfeiting of luxury brands has reached astronomicallevels.The trading of luxury goods in China has proved to be lucrative market as it has been noted as the worlds thirdlargest consumer of high-end fashions, accessories, and other luxury products (Ernst &Young China, 2005; Chadha,2007). The market is recorded as generating more than $2billion in sales a year and is projected to continue

growing by an estimated 25 percent annually (Ernst & Young China2005; Embassy of the Peoples Republic of China, 2005).Such a rampant counterfeit industry could reduce profits and attractiveness to foreign investors, and may threaten the brand equity of both international and local luxury products (Chow,2000; Trainer, 2002).The catalytic growth of counterfeiting can be attributed tothe increase in world trade and emerging new markets, fastpaced technology advancements, and also the increase ingoods that are worth counterfeiting (Wee et al., 1995; Blochet al., 1993; Alcock et al., 2003). Luxury brands are easily counterfeited as it is easy to sell and incur low manufacturing costs (Shultz and Soporito, 1996; Gentry et al., 2006).Moreover, consumer demand is also increasing due to thepursuit of status goods and the desire of being in tune withfashions and fads (Chang, 1998; Eisend and Schuchert-Gu ler, 2006). It is reported by Chinese officials thatcounterfeiting is a staggering $16 billion business annually(Bian and Veloutsou, 2007).

1.1 BACKGROUND

The luxury goods industry is a very lucrative market. Market analyst Mintel had estimated thatthe global luxury goods industry would be set togrow at a compound annual growth rate of 12per cent from the current market value of US $ 70billion to $ 100 billion by 2008. 1 With the luxury market value growing at such a phenomenal rate, many luxury designer brands have become targets for counterfeit producers. It is estimated that the trade in counterfeit brands has exceeded more than $ 500 billion, 2 and is deemed to be a booming market. 3,4 The market in fake goods may reach the $ 2 trillion mark in 20 years, which represents 3 million businesses in the United States. 5 Counterfeiting is extremely rampant in Asia, 6 for instance, Korean Customs Service announced that out of the $ 162.5 million worth of fake products that have been seized, those bearing Chanel s logo alone have accounted for$ 23.5 million, far exceeding any other brand. 7The growth in the counterfeit market can be attributed to the increase in world trade and emerging new markets.

Counterfeiting, the production and sale of fake products that seem identical to the original product, has beenmushrooming across the globe and recently growth in dangerous level (Penz&Stottinger, 2005). Further ,more, ndonesia is among several offenders mentioned in a US report targeting the worlds worst piracy offender who will soon see their illegal market overtaken by the Internet, which is increasingly the sales medium instead of shopping mall stalls and street carts (Jakarta Globe, accessed on October 15, 2012). According to U.S. Customs and Border Protection Office of International Trade (2007), 70 percent of counterfeited goods belong to fashion goods, such as handbags, watches, jewelry, shoes, clothes, hats, sunglasses, and perfume. The current collective buying behavior shows a high demand for luxury brands product by shoppers at many different social classes. Consumers have increased their awareness about design and have begun to expect high style (Kay, 1990). Consumers who are buying luxury brands products may be described as self-conscious and they were especially concerned about the impression they make (Penz&Stottinger, 2005). Fashion counterfeit products are believed to carry a high image and the prestige connected to a well-known brand name. The similarities in appearance, quality, and image created by the counterfeited version compared to the original product are important in determining consumers purchase intention (Wee et al., 1995).This paper attempted to explore the Indonesian consumers mindset in relation to purchasing counterfeitsof luxury brands. The result and model of the previous research had a conclusion which might not be proper to be applied with the recent condition in Indonesia. The research conducted by the previous researcher has differed in location ,object, subject, time and or analysis and generally it was conducted in the foreigncountry whichhas different economic and cultural environment to Indonesia. There are three main objectives of the current study. First, it examines the influence of social and personality

factors to attitudes towards counterfeit products of Indonesian consumers. Second, it investigates the relationship between consumer attitudes andpurchase intention of counterfeits of luxury brands. Third, it examines the influence of social and personality factors to purchase intention of counterfeit products. The producers and marketers of genuine products could then come upwith ways or different strategies in engaging the consumers to buy the genuine products over the counterfeit products.

Counterfeiting of famous ltrxury brands with a strong brand name and high- visibilify is a never growing global industry. Already in 1985 Business Week called counterfeiting perhaps the world's fastest growing and most profitable business" and with more ltrxurybrands with clearlyextemalized signs of recognition there are no that the industry is diminishing. Exactly how big the industry of cotinterfeit merchandise is is difficult to calculate exactly since it is an industry operating on a 'grey market'. One estimate is that cotinterfeiting accounts for more than 6% of worldwide frade or $450 billion a year, and that some $100 million worth of fake goods are seized each year entering the U.S. (Betts,2004). The problem with counterfeit goods has become even more pressing for ltixury brands with the entrance of the Intermit as a new market actor. With professional looking websites, low prices, faster delivery times and wider range of delivery, thecounterfeitmerchandisers are posing a real threat to the luxury houses. The luxtiryhouses are losing enormous amounts ofninety and are for example, responding byputting out the word that buying counterfeit products help support for instance terrorism and other not only illegal activities but also morally apprehensive. One dramatic example ofcounterfeiting leading to losses for brands is that of Louis Vinton in the Italian marketwho in the late 1970swithdrew completely from the market when they found themselves tabletopcompete with the counterfeiters oftheir products (Kaikati&LaGarce, 1980:58).Suppliers of counterfeit merchandise have, like the luxury conglomerates recognized the penetrative power of theIntermit. The practice of counterfeiting has boomed with the possibility of selling on the Intermit. TheIntermit enables the counterfeit merchandisers to reach consumers in all parts of the world.Having shipping allover the world with short delivery times and much lower prices than originalgoods. Also do not face theproblem of being out of reach of mass consumption. A search on 'Rolex watch' renders 17 900 000 hits(December 3"* 2011). Out of the hits a diminishingly small part are for sites with genuine merchandise.Cotmterfeiting is not a new phenomenon but with new sophisticated ways to reach consumers the business isincreasing rapidly. The Intemet offers an abundance of copies, counterfeits, replicas and otherwise knockoffs ofluxury brand items. A search on the term 'Louis Vuitton bags' on Google renders hits (December 3""2011), most of them suppliers who offer counterfeit copies or as they call them 'replicas'.Studies show that price and discotints are important factors for online shopping, this being the perfect argumentfor purchasing and selling cotinterfeitsonline. April

2012inherent connotations of low prices and wide distribution enters the market? Is the Intermit better suited as a communications channel for luxury brands than as means for distribution? In order to investigate these questions this paper studies which 'values' that are prevailing in purchasing counterfeit merchandise online and whatimplications these would have on luxury brand image and consequently also on brand manage. Counterfeiting is one of the fastest-growing industries in the world, with the sale of counterfeit goods estimated to account for up to 10% of world trade. In countries where this problem is particularly severe, such as China, it is speculated that as much as20% of all products sold domestically are counterfeit (Alcock, Chen, Chng, &Hodson, 2003; Balfour, 2005). Beginning with just a few product categories such as luxury clothing and personal accessories, imitation of branded goods now affects awiderange of industries, including music, movies, food, computer software, pharmaceuticals, fertilisers, and machinery parts (Cheung &Prendergast, 2006). Infact, the World Health Organization estimates that up to 30% of all the worlds medicines may well be counterfeits (Alcock et al., 2003).There are a number of reasons for the proliferation of counterfeiting in recent years, including the increase in the demand for branded products with growth in world tradeDownloaded by [St. John's University Libraries] at 10:19 19 September 2011emergence of new markets and removal of trade barriers, mass-production of counterfeit goods with cheaper access to sophisticated technologies, and the rise of the Internet making it easy to store and transfer intangible products such as music, videos, and software with a simple click of a button (Alcock et al., 2003). More ,over, buoyed by inadequate penalties and weak enforcement of the respective laws and regulations, counterfeiting operators in countries like China have grown into power fullobbies with political and criminal connections (Chow, 2003).The market for counterfeit and pirated products consists of two important submarkets(Hubner, 2007). In the primary (or deceptive) market, consumers purchase counterfeit and pirated products believing they have purchased genuine articles. The products are often substandard and may carry health-and-safety risks that range from mild to life threatening. In the secondary (non-deceptive) market, consumers looking for what they believe to be bargains knowingly buy counterfeit and pirated products. The policies and measures to combat counterfeiting and piracy in the two market differ; it is therefore important to know how much of a threat each poses when considering product-specific strategies (Hubner, 2007).Prior research on counterfeiting focuses on its supply side (i.e. deceptive counterfeiting),with little research on the demand side of counterfeiting (non-deceptive), and most of it is either fragmented or exploratory without strong conceptual foundations. Hence ,many unanswered questions and contradictory findings remain (Penz, Schlegel milch, &Stottinger, 2009; Staake,Thiesse,&Fleisch, 2009;Wilcox,Kim,&Sen, 2009).As a result, we still do not know why some consumers may be more prone to buying counterfeit products compared to others. In this paper, we

address this important research gap by conceptualisingaconsumertrait called counterfeit proneness (CFP) that represents the relatively stable tendency to prefer, purchase, and use counterfeit products. We distinguish this trait from other similar constructs such as attitude towards counterfeiting, brand consciousness, face consciousness, materialism, shopping enjoyment, status consumption, and value consciousness. We also develop a reliable and valid scale to measure CFP based on an extensive literature review and a series of empirical studies. Finally, we discuss some applications of our new scale, its limitations, and directions for future research. Counterfeiting is a significant and growing problemworldwide, occurring both in less and well developed countries. In the USA economy, the cost of counterfeiting is estimated to be up to $200 billion per year (Chaudhry et al.,2005). Considering the countries worldwide, almost 5 percentof all products are counterfeit, according to the InternationalAnticounterfeiting Coalition (IACC, 2005) and theInternational Intellectual Property Institute (IIPI, 2003).A number of definitions have been used for productcounterfeiting. In this paper, we use the one given by Co-rdellet al. (1996) and also used by Chaudhry et al. (2005): any unauthorized manufacturing of goods whose special characteristics are protected as intellectual property rights(trademarks, patents and copyrights) constitutes productcounterfeiting.Actions to limit counterfeits can arise from both supply anddemand side, considering the tactics companies employ todeter counterfeits (Chaudhry et al., 2005) and the motivationsthat make a counterfeit an interesting option for some customers.

The luxury goods industry is a very lucrative market. Market analyst Mantel had estimated that the global luxury goods industry would be set to grow at a compound annual growth rate of 12per cent from the current market value of US $ 70billion to $ 100 billion by 2008. 1 With the luxury market value growing at such a phenomenal rate, many luxury designer brands have become targets for counterfeit producers. It is estimated that the trade in counterfeit brands has exceeded more than $ 500 billion, 2 and is deemed to be a booming market. 3,4The market in fake goods may reach the $ 2 trillion mark in 20 years, which represents 3 million businesses in the United States. 5 Counterfeiting is extremely rampant in Asia, 6 for instance, Korean Customs Service announced that out of the $ 162.5 million worth of fake products that have been seized, those bearing Chanel s logo alone have accounted for$ 23.5 million, far exceeding any other brand. 7The growth in the counterfeit market can be attributed to the increase in world trade and emerging new markets

Chapter 2 Review of Literature

2.1 Luxury brands and counterfeit brands

Vanern and Johnson 25 stated that consumers develop prestige or luxury meanings for brands based upon social interactions (for example aspired and / or peer reference group),objectproperties (quality) and hedonic values (for example sensory beauty). Luxury or status goods are defined as goods for which the mere use or display of a particular branded product reflectsprestige onto the owner, apart from any functional utility. 26 Nueno and Quelch27defi ne luxury brands as those whose ratio of functionality to price is low, while the ratio of intangible and situational utility to price is high .Bearden and Etzel 28 concluded that publicly consumed luxury products were more likely to be conspicuous products than privately consumed luxury products. Therefore, luxuryproducts areoften used to display wealth and power, and highly visible luxury brands dominate this conspicuous segment. This is a point put forward by Veblen, 29 who suggested that people use Targeting buyers of counterfeits of luxury brandconspicuous consumption to signal wealth and to infer power and status. Consumers are motivated by a desire to impress others with their ability to pay particularly high prices for prestigious products. 30 When they carry a luxury branded product, it is an ostentatious display of their wealth.Counterfeits are reproductions of a trade market brand usually that of a luxury brand. 23 They are closely similar or identical to genuine articles,including packaging, labelling and trademarks to intentionally pass off as the original product. 31 33According to McDonald and Roberts, 34consumers who purchase counterfeit goods can be separated into those who are deceived into thinking that the product they bought is genuine and those who knowingly buy counterfeits. The first would be a victim, when they unknowingly and unintentionally purchase counterfeit goods due to it being so closely similar to the genuine articles. 9,26,35,36 However, the latter is a willing participant or consumer of counterfeit products, wherein they seek out counterfeit products even when they know that the products are illegal and a copy of the genuine. 9,20,23As such, this paper only focuses on the accomplice , or consumers who are willing purchasers of counterfeits of luxury brands. Counterfeits are cheaper alternatives to the expensive originals. 37 In many instances, these counterfeits have shown that there might not be any noticeable difference in perceived quality. 12As such, counterfeit brands may diminish the symbolic value of authentic luxury brands and dilute the brand equity. 26,38,39Buyers of genuine products may refrain from purchasing these.

2.2 Selected literature review

What are luxury goods? Traditionally, luxury goods or status goods are defined as goods for which the mere use or display of a particular branded product brings prestige on the owner, apart from any functional utility (Grossman and Shapiro, 1988b).These goods are often expensive and exclusive, such as Cartier and Rolex watches, Hermes handbags, Polo shirts, Gianni Versaci suits and Mercedes Benz cars. Recently, luxury producers are finding that the trend to war casual dressing has forced people to search for new ways to set them selvespart and express their personality (Hessen, 1998). This has led to an increasing demand for luxury accessories such as belts, handbags, wallets and pens, which can be easily worn on casual dress days.

Who buys luxury brands? Bushman (1993) conducted a study to examine the buying behavior of publicly self-conscious individuals. According to Bushman, publicly self conscious individuals are especially concerned about the impression they make on others. They are more concerned about physical appearance and fashions; are more likely to use different strategies to gain approval from others; are more compliant with standards in society; and are more sensitive to interpersonal rejections. The results of his study suggest that these individuals prefer buying national and famous brands to bargain brands regardless of what the actual product is like.

While a brand imitation is designed so as to 'look like' and make consumers 'think of the original brand, a counterfeit product is designed to 'be like' the original and provide consumers with a less expensive copy (d'Astous&Gargouri, 2001:153). Counterfeiting has both a supply and a demand side and despite the supply-side efforts to reduce counterfeiting, the practice endures. In some areas, such as consumer fashion goods, counterfeiting appears to be increasing (Chute, 1990). According to Bloch, Bush and Campbell (1993:28) counterfeiting has flourished due to worldwide demand for high profile brands which carry a premium price and are easy to copy. This is consistent with Kapferer's (1997) point that luxury glitters and the fact that luxury is visible is essential: luxury must be seen, by the consumer and by others. That is why luxury brands extemalise all of their signs: the brand signature must be seen and recognized on the person wearing the brand, and it must be recognized worldwide.

2.3 Counterfeit Goods

When purchasing a counterfeit good the consumer may or may not be a knowing and willing participant in the illegal practice. Grossman and Shapiro (1988) identified two types of counterfeiting; deceptive counterfeiting which is described as a situation in which the consumers are not are of purchasing a counterfeit product at the time of the purchase. Consumers cannot readily observe the qualify of the goods, nor can they easily distinguish copies from authentic merchandise. Grossman and Shapiro (1988) indicate that deceptive counterfeiting can be observed mainly in markets for automotive parts, consumer electronic products such as computers and stereo equipment, pharmaceuticals and medical devices. The luxury brand mark ever, often shows the other side, where consumers are involved in non deceptive counterfeiting. In this situation consumers are fully aware of the fact that the product purchased is a counterfeit product at the time of purchase. Grossman and Shapiro (1988)describe that the public is well aware of the market availability of bogus brand name watches, leather goods, fashion apparel, perfumes and designer sunglasses among others. They point to the fact that given this awareness and the fact that these fakes sell for a mere fraction of the cost of the legitimate products in outlets that are evidently not official distribution outlets, one can suspect that many buyers are not fooled. Grossman and Shapiro (1988) also pose the question on why a consumer would knowingly purchase a counterfeit item and give as one possible explanation that the product offers good value for money in light of its frue qualify or use fullness hey render this explanation insufficient because why incur the risks associated with illegal copying when legitimate products could be offered at a lower price. Instead they propose the alterative explanation that it is the label and identifying design characteristics (e.g. logo or distinctive fabric patens) that are of value to consumers, such as the case is for status goods. In buying these types of counterfeit goods the risk is much smaller than with counterfeit goods that are technically advanced or of a medical nature. Counterfeit status goods often offer similar product qualities as the original merchandise and the consumer of this goods is not at any risk of bodily harm, or otherwise 'serious' risk. The consumers of these goods, however, subject themselves to social risk because the goods are of high symbolic value and social visibility (Nill& Shultz, 1996).Efforts of fighting counterfeiting practices come in many forms and Nill and Shultz (1996) propose that among conventional, supply-side remedies against counterfeiting, that include everything from diplomatic and legislative pressure to high-tech product labeling, some are effective while others are not and that because of this, company focus should also be on the consumer demand side of counterfeiting, with an emphasis on ethical consumer decision making.

2.4 The Internet's Affects on Branding

Shopping has become the fastest-growing use of the Intermit, and almost 40 percent of Intermit users report shopping as a primary use of the Web (GVU, 1998 in Donthu&Garcia, 1999). Price comparison sites and shopping agents enable consumers to obtain and compare prices rapidly and put pressure on brand prices as lower price levels become more transparent (Sinha, 2000). Sinha (2000) sees the widespread availability of information about product prices, features and competitors on the Intermit as posing a threat to brands. On a similar note, Sealy (1999) argues that brand management is out of date in today's markets where e.g. inter active marketing make traditional brand management less effective. As an argument for this point of view it is claimed that the greater choice and ability to compare products will make the information provided by brands redundant as the main function of a brand is an indicator of qualify or some feature that differentiates the product or service.

2.5 Luxury Online

Lately brand marketers have found themselves needing to rethink their branding strategies in order to have both off"-line (bricks and mortar environment) and on-line (clicks environment) (de Crematory, 2001). Luxury brands are no exception to this new thinking. De Crematory (2001) argues that a brand that exists in a bricks and mortar environment can be migrated to a clicks environment using the same brand essence, provided it remains true to the same values. This is for example seen on the luxury retailer Luxury, belonging to the LVMH concerns, where Louis Vinton has its' own separate web store. Louis Vinton in the bricks and mortar environment has very selective distribution selling their products solely in their own boutiques which are strategically placed in key locations in larger cities. An online brand experience encompasses all points of interaction between the customer and the brand in the virtual space (Christodoulides& de Chematony,2004:170). Rubinstein and Griffiths (2001:401) pointed out that "...on the Net you have to orchestrate everything you do to deliver a highly differentiated and consistent positive experience". Pine and Gil more(1999:17) encouraged marketers to "create a brand image emphasizing the experience customers can have surrounding the purchase, use, or ownership of a good". Pine and Genres encouragement of emphasizing.

Chapter 3 Research Methodology

3.1) Objective of the study

Nill and Shultz (1996) suggest that companies should implement and sponsor marketing and advertising campaigns to reduce the demand for counterfeit goods. However, they caution that the success of such campaigns depends on a number of factors including product category, individual characteristics of the consumers, strength of brand image and marketing communication method. Based on these suggestions, the objective of this research is to identify who buys pirated brand, why they buy these goods and how they buy them.

3.2) Research design

The research design can be classified in to three broad categories. 1) Exploratory 2) Descriptive 3) Casual In this study using Exploratory research design A focus group was formed to generate more information about counterfeit buying behavior due to the exploratory nature of this study. All the participants in the focus group had recently purchased either pirated VCDs or pirated brands of clothing

3.3) Sampling design

There are two types of sampling designs. A) Probability sampling. B) Non-probability sampling.

Here non-probability research design used. A non-probability sampling technique that attempts to obtain a sample of convenient element. The selection of sampling units is left primarily to the interviewer.

3.3.1) Target population

Demographics Gender Female Male Age 20-29 30-39 40 and above Marital status Never married Married Divorced/separated Occupation Administrative staff Civil servant Executives and managerial Professional Sales and marketing Student Technician/skilled worker Others Annual salary 14000 or below 14001-21000 21001-28000 28001-35000 35001 and above 39 49 62 24 39 19.1 24 30.4 11.8 19.1 31 18 49 22 17 24 20 23 15.2 8.8 24.0 10.8 8.3 11.8 9.8 11.3 160 43 1 78.4 21.1 0.5 139 37 28 68.1 18.1 13.7 154 50 75.5 24.5 N Percent

3.2) Sampling method

Primary Data: The primary data collected through questionnaires administered to a sample of 100 consumers

Secondary Data : Secondary data was collected through various publications of newspapers, magazines, books, research paper.

3.3) Sampling size

Two hundred and four usable responses were analyzed with SPSS software version Of the respondents, 75.5 per cent were female. The majority (68.1 per cent) of the respondents were between 20 and 29 years old. The highest percentage in terms of occupation was executive and managerial level, at 24 per cent.

3.3.4) Execution
Counterfeiting of luxury brands has become a severe global economical problem that cannot be alleviated overnight. Singapore s stand on piracy and intellectual property is a main deterrent for counterfeit products to enter the country. But this has not stopped citizens from purchasing counterfeit products when they are overseas. Countries are best advised to work together to defeat or curb this problem. Notably, the stance towards anti-counterfeiting is toughening on a global scale. However, it requires long-term planning and execution of strategies that suitably target consumers and suppliers to be able to succeed. It is crucial for managers to understand the fundamentals of consumer attitudes and purchase behaviors of counterfeits to be able to counter the counterfeit epidemic. In summary, this study presents the following conclusion: It is evident that consumer attitudes towards counterfeits of luxury brands play an important role in affecting consumer purchase intention. The social influence of the consumers plays an important role in their intention towards purchasing counterfeits. Even though most Singaporean consumers have a stable income, the price and quality of the counterfeit luxury product versus the original is still an incentive for them to opt against the latter. There are a number of limitations worthy of improvement and future research. This study was conducted through an online survey and distribution of printed surveys among a certain social circle. This may limit the populations that could be reached. It is relatively tough to find retail shops that sell counterfeits of luxury brands. Those who purchase counterfeits of luxury brands may not have bought them in Singapore, but may

have purchased them when they were overseas, where counterfeit products are readily available. The addition of factors such as where do they usually purchase or where did they last purchase the counterfeit luxury products can be further investigated to test for their influences on consumers. Another study on Singaporean consumers who travel overseas frequently and who often buy counterfeit luxury products could well be delved into and examined. This could entail the examination of situational and emotional factors involving tourists on holiday, as they are likely to have a sense of excitement and a softened ethical stance.

3.5) Tools for data collection

The survey instrument was designed and put up on a website. Three hundred postgraduate students from a large university were emailed the website address, and were instructed to take part in the survey. It was highlighted to the sample that participation in this study was voluntary and that respondents anonymity was ensured. Owing to the sensitivity of some questions asked, the respondents were further reassured that their responses would not be traced back to them. The demographic details requested were purely for statistical analysis. Respondents were given 2 weeks to complete the survey, and a reminder email was sent 1 week before the survey was closed. Two hundred and twenty surveys were completed, but 16 were rejected due to incomplete information. As such, 204 usable responses were employed in the final analysis.

3.8) summary
It is crucial for managers to understand the fundamentals of consumer attitudes and purchase behaviors of counterfeits to be able to counter the counterfeit epidemic. In summary, this study presents the following conclusion: It is evident that consumer attitudes towards counterfeits of luxury brands play an important role in affecting consumer purchase intention. The social influence of the consumers plays an important role in their intention towards purchasing counterfeits. Even though most Singaporean consumers have a stable income, the price and quality of the counterfeit luxury product versus the original is still an incentive for them to opt against the latter.

There are a number of limitations worthy of improvement and future research. This study was conducted through an online survey and distribution of printed surveys among a certain social circle.

This may limit the populations that could be reached. It is relatively tough to find retail shops that sell counterfeits of luxury brands. Those who purchase counterfeits of luxury brands may not have bought them in Singapore, but may have purchased them when they were overseas, where counterfeit products are readily available.

The addition of factors such as where do they usually purchase or where did they last purchase the counterfeit luxury products can be further investigated to test for their influences on consumers. Another study on Singaporean consumers who travel overseas frequently and who often buy counterfeit luxury products could well be delved into and examined. This could entail the examination of situational and emotional factors involving tourists on holiday, as they are likely to have a sense of excitement and a softened ethical stance. Further exploration using qualitative approaches to examine consumer purchase behavior of counterfeit products may provide deeper insights. Quantitative approaches are very commonly used, and the understanding derived may still be limited.

3.8) Hypothesis

H1: Brand consciousness has a negative influence on the attitudes towards counterfeits of luxury brands.

H2: Personal gratification has a negative influence on attitudes towards counterfeits of luxury brands.

H3: Value consciousness has a positive influence on attitudes towards counterfeits of luxury brands.

H4: Consumers who are more concern about price over quality have more negative attitudes towards counterfeits of luxury brands. H5: Social influence has a positive effect on attitudes towards counterfeits of luxury brands. H6: Brand prestige has a negative effect on attitudes towards counterfeits of luxury brands.

H7: Consumers with positive attitudes towards counterfeits of luxury brands have higher intention to purchase counterfeits of luxury brands.

3.9) Pilot testing

A pilot test of ten samples was used to elicit the willingness of participants to participate in the survey. This was largely due to the sensitivity of the topic of the study. It was planned to adopt the projective technique if this method of data collection was not acceptable. However the results of the pilot test justified the original choice of survey method.

Chapter 4 Questionnaires

Dear sir or mam, we are the student of V.M. PATEL INSTITUTE OF MANAGEMENT in M.B.A Programme sem-1.This questionnaire is a part of the research for a master dissertation related to Factors Influencing Consumer Behavior While Purchasing Bike. The results of this survey will be used for academic purposes only. The survey is anonymous and does not require any personal details to be submitted.

Name

: ______________________________ Male Below 20 31-35 46-50 61-65 76 & above Female 20-25 36-40 51-55 66-70 26-30 41-45 56-60 71-75

Gender : Age :

Profession/Occupation: PG Student Self Employed Employed Retired Person

1. In your opinion, how easily available are counterfeit products in your home country? In your opinion, how easily available are counterfeit products in your home country? available Almost easily available Available Difficult to get Not available 2. Do you think you are able to distinguish a counterfeit product from the original? Do you think you are able to distinguish a counterfeit product from the original? Yes No Easily

3. How likely are you to buy a counterfeit? How likely are you to buy a counterfeit? Very likely Likely Maybe Not likely Not at all

4. Do you think the actions taken against counterfeit products are severe enough to stop you from buying these products in your country? Do you think the actions taken against counterfeit products are severe enough to stop you from buying these products in your country? Yes No

5. Would more severe consequences stop you from buying counterfeit products? Would more severe consequences stop you from buying counterfeit products? Yes No 6. If yes, which consequences would stop you from buying counterfeit products? (Please tick all that apply, multiple answers possible) If yes, which consequences would stop you from buying counterfeit products? (Please tick all that apply, multiple answers possible) Imprisonment Border Control Social stigma Monetary penalties Laws Education Company initiatives

8. In your opinion, how easily available are counterfeit products in your home country? In your opinion, how easily available are counterfeit products in your home country? available Almost easily available Available Difficult to get Not available 9. Do you think you are able to distinguish a counterfeit product from the original? Do you think you are able to distinguish a counterfeit product from the original? Yes No Easily

10. How likely are you to buy a counterfeit? How likely are you to buy a counterfeit? Very likely Likely Maybe Not likely Not at all

11. Do you think the actions taken against counterfeit products are severe enough to stop you from buying these products in your country? Do you think the actions taken against counterfeit products are severe enough to stop you from buying these products in your country? Yes No

12. Would more severe consequences stop you from buying counterfeit products? Would more severe consequences stop you from buying counterfeit products? Yes No

13. If yes, which consequences would stop you from buying counterfeit products? (Please tick all that apply, multiple answers possible) If yes, which consequences would stop you from buying counterfeit products? (Please tick all that apply, multiple answers possible) Imprisonment Border Control Social stigma Monetary penalties Laws Education

Bibliography
1988 Grossman Foreign counterfeiting of status goods 2004 Gupta, P.B, Gould To pirate or not to pirate? A comparative study of the ethical versus other influances on the consumer software acquisition

mode decision. 2003 Harvey, P.J Laboratory markets in counterfeit goods: hong kong versus las vegas. 1980 2003 Hawkins Hoe, Hogg Consumers behavior Fakin it counterfeiting and

consumer contradictions 1987 1989 1991 Harvey, M.G. Foster, M. Fortune Industrial product counterfeiting. US firms battle the pirates of taiwan How copycate steal billions