Prologue

Little Red Riding Hood picked a basketful of flowers from the forest and gleefully made her way home to visit her grandmother. She opened the door and saw the all familiar sight of her grandmother sitting on the rocking chair by the side of the window. The young girl happily showed her grandmother the flowers she picked and soon found something amiss.

Girl:     My what big teeth you have! And, your nose is so long. Grandma, are you alright… Oh my goodness, who are you?
Wolf:   I’m your new grandmother. Do not worry my darling, I will not hurt you. In fact, I will take care of you just the way your granny did. I will cook and wash for you.
Girl:     But my grandma has been doing that for me, I rather have her back.
Wolf:   How about this? Above what your grandma did for you, I am going to bake you a chocolate cake everyday for tea.
Girl:     Now, let me think about it...

In the southern district of Kunming city in south-west China, you will see huge furniture stores painted with the blue and yellow colour scheme that you are familiar with. In the stores, you will also see the familiar cute miniature pencils and shopping bags. Yes, the whole look and feel of the furniture stores are close to, if not, the same as IKEA. The only difference perhaps is that none of the furniture is IKEA’s. This is the big bad wolf that terrorises reputable global brands like IKEA. It and its brethren are copycats and not counterfeits or fakes. The difference is that the latter are outright illegitimate. The former, on the other hand, are brands which outright mimic originals and are legal unless challenged.

The Wolf

The rewards to play the wolf are obvious. Leveraging on established brands, these copycats can ensure themselves a decent market penetration. Apart from that, it would also enable them to position themselves in the relevant frame of reference that their customers relate to. Best of all, all the effort and resources needed to build the brand are “saved” – accounting wise. Of course, such brands often lack the element of authenticity, individuality or originality. Gaining the trust and emotional connections from consumers may be tricky as a result. So are these brands set up for failure?

In the case of the evil cousin of IKEA based in China, one of the customers of the store revealed that she had wanted to purchase products from IKEA. However, she chose to patronise the copycat instead as the store’s location served her needs better. The customer was able to obtain the similar “IKEA experience” from the copycat and there was no real driver for her to insist on purchasing from the original. Contextual factors aside, the real question confronting customers and global brands is “Why not?” If customers are able to harvest from the copycats the same values that they get from the originals, and on top of that receive incremental values, why not? Such a notion is certainly terrorising. This terror is however, more for global brands than for customers.  

The Hunter

The widely known story has various endings. One of them is the appearance of a hunter who kills the wolf and saves the cannibalised grandmother. So, who can be the hunter to get rid of the big bad wolf? How about finding protection from the power that legislation confers? Possibly, but the odds is against the brand to emerge from the nasty episode unscathed.

In some cases, by the time the hunter does his heroic act, the poor granny may have already been gnawed beyond recognition. Take Ferrero Rocher for example, the brand finally won a long-running case against a copycat which had copied the brand’s packaging. It is a victorious battle indeed. Albeit one that had emerged only after the products of the copycat had won many awards in local and international competitions; after the copycat had became more popular than Ferrero Rocher in China; and despite the fact that there are still a bunch of copycats out there.

So what else can brands do if the law can’t confer 100% protection? How about the power of love?

Grandma

Surely, the wolf promises to take even better care of our Little Red Riding Hood than her own grandmother. What about the girl’s love for her granny and the relationship between them? Some brands have a strong bond with its customers. Sometimes the bond is so strong that it develops into the great form of brand love. In many cases, this power of brand love can triumph the entrancements of copycats. The love is so strong that only through the purchase of the original can the needs of the customer be satisfied.

As divine as the notion may sound, the matter of fact is that the construct, brand love or brand equity, is anchored on customer needs. Based on this premise, brands build relationships with their customers. Each relationship with a customer is differentiated and unique. The hands of law can mould customers’ behaviours but not their needs. Brands need to give customers a reason for them to be loyal. Otherwise, customers would have no qualms on harvesting from copycats similar (if not more and even better) values than the originals.

Take illustrious brands such as Harley Davidson for example. The value underlying the purchase of the motorbike transcends the product itself for customers who adore or love the brand. Widely known, brand loyalists of Harley Davidson buy the product not just for the vehicle and its functionalities. Some bought the product as a form of self-expression. There are some who use it as a vehicle to band themselves together as a community. There is no way for brand values of the sorts of Harley Davidson to be harvested easily by a copycat.

The Girl

So who will Little Red Riding Hood choose? The wolf or grandma? That will be your call.

 

(To read more on “Chinese Retailers Hijack the Ikea Experience”, please click here.)

Hector Lin Chengwei, 2011
Copyright © Beacon Consulting Pte Ltd

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