Entry of Copycats of Luxury Brands

Gao, Sarah Yini; Lim, Wei Shi; Tang, Christopher S.

doi:10.1287/mksc.2016.1008

Cited by 102 publications

(73 citation statements)

References 22 publications

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“…However, while controlling for these factors, our study adds peers' imitation behavior in interaction with uncertainty as an explanation for firms' decisions to have or not have CMOs. In this way, we link to the broader marketing literature that investigates copycat marketing activities like copycat private labels or copycat luxury brands (see, e.g., Kelting et al 2017;Gao et al 2016). We also show that imitation behavior is at work not only in terms of marketing activities in the marketplace, as these recent studies show but also when firms set up their internal marketing organizations (e.g., in the form of the CMO position).…”

Section: Theoretical and Managerial Implicationssupporting

confidence: 54%

The copycat CMO: firms’ imitative behavior as an explanation for CMO presence

Wiedeck

Engelen

2017

J. of the Acad. Mark. Sci.

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The present study adds to the CMO literature the perspective of firms' imitative behavior on why firms have CMOs in their TMT. We propose that a firm's decision to have a CMO on its TMT is driven not only by contingency-reated considerations but also by social ones, as the decision is significantly influenced by industry peers. Empirical findings based on 505 large US firms from 2000 to 2012 indicate that firms' imitative behavior is a significant driver of CMO presence, especially when firm uncertainty is strong and inference uncertainty is low. Post hoc analyses indicate that this imitation behavior tends to be performance neutral at best.

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Section: Theoretical and Managerial Implicationssupporting

confidence: 54%

The copycat CMO: firms’ imitative behavior as an explanation for CMO presence

Wiedeck

Engelen

2017

J. of the Acad. Mark. Sci.

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“…Zhang and Zhang (2015) identify the optimal supply chain structure in the presence of deceptive counterfeits. Gao et al (2017) suggest that copycats with a high physical resemblance and yet a low quality are more likely to defy the deterrence of the incumbent and successfully enter the market. Pun and Deyong (2017) characterize a manufacturer's optimal quality decision when it competes with a copycat in selling to strategic customers.…”

Section: Literature Reviewmentioning

confidence: 99%

“…We analyze the supply chain's active decision on direct combat and explore its strategic implications to the entire supply chain. The direct-combat option also differentiates our work from the limit-pricing literature (a detailed review of this literature is provided by Hall 2008), where a lower price is adopted as a strategic deterrence to entry of competitors (see Gao et al 2017 for an application of limit pricing in anti-counterfeiting).…”

Section: Literature Reviewmentioning

confidence: 99%

Impacts of Counterfeiting on a Global Supply Chain

Cheung

2022

M&SOM

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Problem definition: This paper investigates how counterfeits influence a global supply chain and how the supply chain should effectively take anticounterfeit actions. Academic/practical relevance: The impacts of counterfeiting have been increasingly profound on global supply chains. It is critical to understand how counterfeiting impacts supply chains when supply chain members act in their own interests, and how supply chains can effectively combat counterfeiting when all the members can contribute to it. This is the first paper that offers insights into these important questions. In particular, we examine who among the supply chain members is in the best position to perform counteracting activities, how these members can cooperate in anticounterfeiting, and what economic implications the anticounterfeit actions have to the supply chain, individual firms, consumer surplus, and social welfare. Methodology: We consider a supply chain consisting of a manufacturer and a retailer, and analyze a game-theoretical framework to derive the equilibrium. Results: The manufacturer prefers to induce the retailer to combat counterfeits rather than to combat itself. Contrary to conventional wisdom, counterfeits can increase the supply chain’s profit even in the absence of network externality effects. The crux is that the manufacturer lowers wholesale price to incentivize the retailer’s counteraction and, consequently, the threat of counterfeits can mitigate double marginalization and benefit the supply chain. Managerial implications: Our results demonstrate that a sustainability risk can trigger collaborative endeavors of supply chain members and thus be advantageous to the supply chain. The findings also underscore the important role that retailers should play in anticounterfeiting. Particularly, it can be in the supply chain’s interest that the manufacturer does not execute the counteraction, either jointly with the retailer or by itself.

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“…erefore, the more the consumers buy base products, the higher the uniqueness value of consumers who buy customized products is. Following the ideas of Li [32], Rao and Schaefer [28], Gao et al [36] on the construction of social status utility for buyers, they assume that consumers have homogeneous status preferences, as the higher-status consumers buy a product, and the product's status utility becomes higher. Based on the construction of social status utility for buyers, we try to introduce the construction concept into the depiction of consumers' unique preferences for customized products.…”

Section: Uniqueness Utilitymentioning

confidence: 99%

Vertical Line Extension Decisions in a Competitive Market with Consumers’ Need for Product Uniqueness

Wang

2020

Discrete Dynamics in Nature and Society

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One important reason for offering customized products is to satisfy consumers’ need for product uniqueness. In this paper, we take consumers’ unique preferences into account to examine how firms make decisions on vertical line extensions with introducing a customized product. This study develops the consumer’s utility function, which captures consumers’ behavioural and emotional factors, and the results show that the high-quality firm always introduces an upward extension without uniqueness sensitivity. However, introducing a downward extension may be more profitable especially when consumers have the high unique ness sensitivity. We also find that the upward extension of the high-quality firm does not intensify competition with the low-quality firm, but its downward extension will intensify the competition between two firms, whether with or without unique preferences. We also analyse the low-quality firm’s extension decisions when it faces a high-end competitor and find that the low-quality firm may change from introducing a downward extension to introducing an upward extension when intrafirm quality differentiation is small.

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Entry of Copycats of Luxury Brands

Cited by 102 publications

References 22 publications

The copycat CMO: firms’ imitative behavior as an explanation for CMO presence

The copycat CMO: firms’ imitative behavior as an explanation for CMO presence

Impacts of Counterfeiting on a Global Supply Chain

Vertical Line Extension Decisions in a Competitive Market with Consumers’ Need for Product Uniqueness

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