Just How Widespread Is Footwear’s Counterfeit Problem, Anyway?

It’s never been easier to buy a pair of knockoff shoes — or harder to tell them apart from the real deal.

The global market for counterfeit goods has ballooned into an estimated trillion-dollar industry, and e-commerce has only made the problem more pervasive. Footwear is consistently identified as one of the top targets for fakes, and a new report from the Better Business Bureau, “Fakes Are Not Fashionable,” makes it clear that counterfeiting can be as damaging to consumers as it is to brands and the overall economy.

The BBB notes in the report that it has received thousands of complaints in recent years from consumers who have inadvertently purchased knockoff goods online. Sellers will often use genuine product images stolen from brands and other legitimate sources to make their sites seem trustworthy, leaving it up to the consumer to assess whether they’re getting the real deal (and figure out what recourse they have if their purchase turns out to be fake).

Few take action at all: According to the FTC, less than 10% of fraud victims ever complain to law enforcement or the BBB. Obtaining a refund through a credit card company can also be laborious, as most will demand proof that the item is counterfeit. (In Canada, an anti-fraud initiative called Project Chargeback streamlines the process and has helped 42,000 people obtain $14.7 million in refunds since it launched.)

FTC Counterfeit Goods Data Chart

Ideally, fakes would never make in into the country in the first place — according to a study by the U.S. Government Accountability Office, about 88% of the counterfeit goods in the U.S. originate in China or Hong Kong — but they often aren’t easy to catch. Counterfeiters have been caught hiding illegal wares underneath other items (one stashed fake Adidas sneakers under packages of napkins); importing unbranded goods, then adding tags and other identifying features like Nike swooshes once the shipment has slipped past customs; and falsifying bills of lading.

Of the counterfeit goods U.S. customs did seize in 2017, footwear was among the top three categories, per the BBB (the others being apparel/accessories and watches/jewelry).

In a survey of 315 consumers that had bought athletic footwear online within the past 6 months, brand protection technology firm Red Points found that 20% of respondents said they had bought fake shoes online. Of those that had, most started their search looking for the genuine product, or a similar style at a lower price point.

Luxury brands like Christian Louboutin are also targets for counterfeiters: In 2012, more than 20,000 knockoff pairs featuring the designer’s trademark red soles were seized by U.S. customs, at an estimated value of $18 million. Online counterfeit sales are responsible for approximately $30.3 billion in annual losses to luxury brands, according to data service firm ResearchAndMarkets’ Global Brand Counterfeiting Report.

There’s reason to believe the problem will get worse before it gets better, too. Last June, as the trade war between China and the U.S. was beginning to heat up, several trade associations, including the American Apparel & Footwear Association, joined in writing a letter to President Trump warning that additional tariffs on imported goods could end up indirectly fueling the counterfeit industry.

“Rather than pay more for legitimate goods, we fear that consumers might seek cheap counterfeits as a replacement, whether knowingly or unknowingly,” the letter read. “In other words, U.S. policy could help legitimize fake goods at the expense of rightful intellectual property owners.”

Instagram is also an increasingly popular avenue for counterfeiters, a recent study by the analytics firm Ghost Data found. In analyzing 4 million Instagram posts or Stories that included hashtags related to fashion brands, it discovered that nearly 20% featured counterfeit products. Sellers hawked phony Yeezy sneakers and Gucci loafers on profiles that together posted an average of 65 million Instagram posts and 1.6 million Stories a month. As the platform pushes to add more shopping features — like the ability to shop directly from influencer profiles, added earlier this month — its appeal to illegitimate sellers, too, will no doubt increase.

Check out a video about how to care for your sneakers this summer:

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