Counterfeit kit: a fan’s own goal
According to a recently published report from “The Economic Impacts of Counterfeiting and Piracy”, the negative effects of infringement are projected to drain $4.2 trillion from the global economy by 2022. The loss is calculated by looking not just at the value of goods, but also the wider socioeconomic impact. For example, the report suggests, by 2022, 5.4 million legitimate jobs would have been affected.
No industry is immune. Sports clubs, athletes and governing bodies face the same issues as many other brand-owning businesses. For example, the US Immigration and Customs Enforcement (ICE) recently announced that it seized more than 260,000 counterfeit sports-related items with an estimated value of $20 million.
As part of its ‘Football against Fakes’ campaign launched in 2014,the UK Premier League revealed that in the 2014/5 season it had seized over 500,000 counterfeit items with an estimated value of £3.1 million ($3.8 million)—this does not include confiscations made by clubs and kit manufacturers directly.
Many individuals believe that purchasing counterfeit goods is a victimless crime. In the sports and entertainment industries, the lines between fan merchandise and counterfeits can often seem blurred. Ironically, however, the victims are often the clubs that the fans support.
While fans can see the sums of money attached to television deals, the transfer fees being paid in football and the vast sums paid to players, they have to pay ever-increasing ticket prices. Merchandise is expensive and for many, after paying for entry, travel and food, it is unaffordable. Yet to be part of the tribe, you must wear your club’s colours.
Is it any surprise, therefore, that some longstanding supporters, who have seen their club turn from a symbol of the local community into an international business, are looking to save costs where possible? They cannot save on the cost of a ticket, but purchasing counterfeit goods or unofficial products seems like an innocent indiscretion and a way to save money.
While not all teams sell merchandise on the scale of, say, Manchester United, it is a serious business. Merchandise income is a vital part of every club and every governing body’s revenue stream.
For a club, loss of this revenue can affect its ability to attract better calibre players and offer a more enjoyable match day experience for supporters and sponsors.
“IT IS CLEAR THE DEMAND IS THERE AND, GIVEN THE OPPORTUNITY, SUPPORTERS WOULD (GENERALLY) MUCH RATHER CONTRIBUTE TO THEIR OWN CLUB’S POCKETS THAN A COUNTERFEITER’S.”
In the US, merchandise income is distributed to all teams and goes to support the marketing, promotion and operation of the sport itself.
The impact of counterfeit merchandise can have a disproportionate effect on the finances of clubs in the UK’s lower leagues, which perhaps do not have the same level of supplementary income from broadcasting rights that elite clubs enjoy.
Buying counterfeits effectively removes valuable income which, in some cases, will not come from elsewhere. It reduces the club’s ability to compete, affects the game day experience and forces a club to increase other sources of income—such as ticket prices. A poorly performing team isn’t going to attract the best sponsorship deals.
The point is not that buying an official product will turn your club from also-rans to table-toppers. But buying counterfeit products will hurt your club.
It is not just the clubs that suffer. Fans are potentially at risk too. Not all counterfeit products are bought by consumers knowing they are fake; many copies can be found that look similar to the originals but are inferior. Counterfeiters generally don’t consider the consumer experience when copying another product.
Practical solutions
The first line in any fight against counterfeiting is to take proactive action to remove the fakes from sale. Certainly, sports clubs should ensure they do what they can to protect their rights (filing trademark registrations and ensuring ownership of any other rights in any logo).
Education is also important. In the short term, publicising the risks associated with counterfeits and the extent of the problem will certainly help. Many clubs are now publishing IP guides on their websites which outline their position on counterfeiters and the role fans can play in the fight to protect the club.
In the long term and from a supporter’s perspective, the most obvious solution is for clubs to offer more affordable official products. It is clear the demand is there and, given the opportunity, supporters would (generally) much rather contribute to their own club’s pockets than a counterfeiter’s, especially when they understand the risks. As neither party can resolve the issue individually, some level of compromise between a club and its supporters is required.
In the years ahead, they will need to play on the same team if the counterfeiters are to be beaten.
Jeremy Summers is a partner and head of the media and entertainment group at Lewis Silkin. He can be contacted at: jeremy.summers@lewissilkin.com
