2020
dynamics of change
and consumer behavior
COUNTERFEIT
SNEAKERS
IN RUSSIA
Fake or original?
Introduction
With the purpose of monitoring the counterfeit sneaker market, we have conducted our second annual survey based on the integrated data collection approach. The integrated approach to data collection means accumulation and generalization of data on online sales of counterfeits (in online stores, on social media and marketplaces) and offline sales (in street markets, brick-and-mortar shops, and shopping malls), as well as conducting consumer surveys. The data from the various sources helps verify the survey's results and make them more reliable; and, most importantly, it possesses not only descriptive but also predictive qualities.
- 63 blnTotal sales volume of counterfeit footwear
- >1 mln sales offer postsOnline counterfeit sports shoes sales
- 25 000 points of salesOffline counterfeit sports shoes sales
DISCLAIMER
This report was prepared for the purposes of research and information only, and is not intended to promote, advertise, or undermine the reputation of any companies, goods, or brands. The information contained in the report does not constitute legal or other professional advice, nor was it prepared for any specific client. This information may not be used by any entity or individual as a recommendation or an instruction to act, but it can be used as an overview of the topic it discusses. For all data referred to in the report, consent was received from respective data owners. All data was rendered anonymous and aggregated in order to be used in this report for statistical purposes. We disclaim all liability for any losses or other negative consequences arising in relation to the use of this report as an instruction to conduct your business. This report is the intellectual property of Brand Monitor LLC. The report and/or any data contained therein may not be used without consent by Brand Monitor LLC or without a reference to the report and its authors.
This report was prepared for the purposes of research and information only, and is not intended to promote, advertise, or undermine the reputation of any companies, goods, or brands. The information contained in the report does not constitute legal or other professional advice, nor was it prepared for any specific client. This information may not be used by any entity or individual as a recommendation or an instruction to act, but it can be used as an overview of the topic it discusses. For all data referred to in the report, consent was received from respective data owners. All data was rendered anonymous and aggregated in order to be used in this report for statistical purposes. We disclaim all liability for any losses or other negative consequences arising in relation to the use of this report as an instruction to conduct your business. This report is the intellectual property of Brand Monitor LLC. The report and/or any data contained therein may not be used without consent by Brand Monitor LLC or without a reference to the report and its authors.
Description of the survey
This is the second annual survey of counterfeit sneakers of popular brands conducted by BrandMonitor. The survey is based on the integrated approach to studying fake product markets. The integrated approach suggests combining data from three sources—the Internet, traditional retail channels, and consumer polling—into a comprehensive picture of the problem. BrandMonitor's own monitoring platform stores data on the sale of counterfeits in traditional retail stores: ongoing data collection occurs during test purchases made in shopping malls, street markets and retail outlets. Our experts have examined over 5,500 shops and over 15,000 pairs of shoes
to date. With regard to online sales, we conduct uninterrupted screening of social media, online stores and marketplaces, with more than one million posts identified so far as offering fake sports gear. Identification of brands and detection of counterfeits is executed with the help of machine learning and computer vision techniques, as well as by expert examination of photographic images and broader contextual data.
to date. With regard to online sales, we conduct uninterrupted screening of social media, online stores and marketplaces, with more than one million posts identified so far as offering fake sports gear. Identification of brands and detection of counterfeits is executed with the help of machine learning and computer vision techniques, as well as by expert examination of photographic images and broader contextual data.
The market of counterfeit sneakers
This year is marked by a contracting sneakers market, both for originals and counterfeits. In comparison to the first survey conducted in 2019, consumption of athletic footwear has experienced a noticeable decline: the number of respondents who had bought at least one pair of sports shoes in 2020 dropped by 8% compared to the previous year. At the same time, counterfeit sneakers made up 42% of all purchases, unchanged from the year before.
The value of the counterfeit sneaker market amounted to RUB 63 bn, whereas the value of the authentic sneaker market was RUB 150 bn. The pandemic and related restrictions as well as deepening financial problems caused losses to sellers of fakes: RUB 14 bn in lost sales compared to the previous year.
The value of the counterfeit sneaker market amounted to RUB 63 bn, whereas the value of the authentic sneaker market was RUB 150 bn. The pandemic and related restrictions as well as deepening financial problems caused losses to sellers of fakes: RUB 14 bn in lost sales compared to the previous year.
Online
Using its proprietary monitoring platform, BrandMonitor carried out a survey of the sale of counterfeit goods on social media and online marketplaces (VK, Instagram, Avito and Youla). The survey concerned various products, including luxury footwear and apparel1, sports gear and sneakers in particular.
We examined a total of 1 million posts advertising fake athletic gear by the most popular brands. The surveyed ads were published in the 2-year period from June 2018 to June 2020. Of all sports gear, sneakers appear to be the most targeted by counterfeiters and illicit sellers, with ads for copies or replicas of genuine sneakers amounting to 90% of all ads for fake athletic goods on Instagram and 72% on VKontakte. At the same time, the total number of posts has grown 1.5 times since the start of 2020.
We examined a total of 1 million posts advertising fake athletic gear by the most popular brands. The surveyed ads were published in the 2-year period from June 2018 to June 2020. Of all sports gear, sneakers appear to be the most targeted by counterfeiters and illicit sellers, with ads for copies or replicas of genuine sneakers amounting to 90% of all ads for fake athletic goods on Instagram and 72% on VKontakte. At the same time, the total number of posts has grown 1.5 times since the start of 2020.
Counterfeits by categories on Instagram
% of total posts
90%
Sneakers
8%
Apparel
2%
Backpacks
Counterfeits by categories on VKontakte
% of total posts
72%
Sneakers
25%
Apparel
3%
Backpacks
In June, the monthly publication rate exceeded 2,000 posts. A brief slowdown in April may have been caused by disrupted supplies due to pandemic-related restrictions.
The number of users following Instagram accounts that sell counterfeits reached almost 5,000,000 in the period from July 2019 to June 2020. However, it is still 18% down from the same period of the previous year.
The number of users following Instagram accounts that sell counterfeits reached almost 5,000,000 in the period from July 2019 to June 2020. However, it is still 18% down from the same period of the previous year.
Offline
Despite the predictable growth in the share of online channels in the total sales of counterfeit sneakers, the traditional offline channels remain in the lead. Around 60% of all counterfeits are sold through brickand- mortar shops and street markets.
BrandMonitor accumulates data on illicit trade in over 150 cities with a population of 10,000 and more. According to our records, at least 25,000 points of sale engaged in selling counterfeit sneakers are operating in Russia. These vary from stalls in street markets to bigger retail outlets in shopping malls. Interestingly, the bigger the shopping mall, the higher the price of a pair of sneakers. The price tag of a pair of fake sneakers is also determined by the size of the city: counterfeits tend to be more expensive in bigger cities.
BrandMonitor accumulates data on illicit trade in over 150 cities with a population of 10,000 and more. According to our records, at least 25,000 points of sale engaged in selling counterfeit sneakers are operating in Russia. These vary from stalls in street markets to bigger retail outlets in shopping malls. Interestingly, the bigger the shopping mall, the higher the price of a pair of sneakers. The price tag of a pair of fake sneakers is also determined by the size of the city: counterfeits tend to be more expensive in bigger cities.
Holidays and covid-19
Speaking of their anticipated shopping expenses connected with Black Friday/Christmas/the New Year, about 20% of respondents mentioned they were planning to spend less on clothes and shoes compared to the previous year, with 36% of interviewees saying they would look for the maximum discount on the usual goods and 9% admitting they would not mind buying copies of famous brands in order to save money. Such consumer strategies may give counterfeiters a further boost.
The value of counterfeit sneakers by famous brands totaled RUB 63 bn in 2020. The number of consumers who bought at least one pair of athletic shoes over the past year went down 8%, while the average price per pair of fake sneakers dropped by 10% to RUB 2,160. Sellers of fakes suffered at least RUB 14 bn losses compared to sales in the previous year.
The share of online channels grew by 10%; their sales totaled RUB 25 bn. This growth can be attributed to decreasing consumer traffic in street markets and brick-and-mortar shops during lockdowns imposed from spring through summer of this year. Traditional offline channels generated 60% of fake sneaker sales, with the value of RUB 38 bn. At least 25,000 points of sale engaged in selling of counterfeit athletic footwear operate in Russia. Counterfeit goods are accepted. Evaluating consumption of fake products, Russian consumers rarely perceive it as a problem. Only half of respondents believe authenticity matters when it comes to making a purchase.
The share of online channels grew by 10%; their sales totaled RUB 25 bn. This growth can be attributed to decreasing consumer traffic in street markets and brick-and-mortar shops during lockdowns imposed from spring through summer of this year. Traditional offline channels generated 60% of fake sneaker sales, with the value of RUB 38 bn. At least 25,000 points of sale engaged in selling of counterfeit athletic footwear operate in Russia. Counterfeit goods are accepted. Evaluating consumption of fake products, Russian consumers rarely perceive it as a problem. Only half of respondents believe authenticity matters when it comes to making a purchase.
Designer:
Anna Ilyina