Electronic Retailer - July 2012 - (Page 26)

Counterfeiting: Why What We Can Do Counterfeiting is one of the biggest issues facing the direct response industry. There are ways that you can combat the problem, but it takes real commitment. s ‘ 26 BY GREG SATER AND CHRISTOPHER CROOK “Say you open up a shop on Main Street,” hypothesizes Jonathan Gelfand, chief legal officer and senior vice president of business development for Beachbody, LLC, the company behind the hit fitness DVD series P90X and Insanity. “You open your doors, you let the public in and, almost immediately, you see people shoplifting from your store. They’re stealing your stuff. Are you going to tolerate that? Of course not! You’re going to take action. So why should your reaction be any different with counterfeiting? It shouldn’t. You can’t just let it happen.” Gelfand should know. Over the last several years, Beachbody has committed significant resources to identifying and going after counterfeiters in China, the U.S. and all over the world. “Not only do counterfeiters take away sales that should be ours, something that goes straight to our bottom line, but did you know that counterfeiting is now the No. 1 source of revenue for organized crime and terrorism? It’s even ahead of the drug trade. Many product marketers feel that there’s nothing they can do about it. But that’s wrong. There’s a lot that can be done. You just have to be committed to it.” As Gelfand explains, “We’ve had a lot of success with civil and criminal lawsuits, raids and seizures everywhere, including in China, where, among other things, we even had a factory owner sent to prison for counterfeiting. What you need is a dedicated staff, a dedicated budget, experienced anti-counterfeiting vendors and good lawyers.” So is it time to break out the bubbly? No. Not even close. The reality is that countless other marketers and ERA members report that they have had negative experiences trying to go after counterfeiters, especially when they’ve tried to do it in China. Moreover, many of those who have had positive experiences (and there are several!) still report a high level of relative frustration with the fact that, once they’ve cut off one head of the hydra, five other heads sprout up immediately. Michael Casey of Fitness Brands, Inc., the company behind the hit abdominal exercise device the Ab Circle Pro, for example, laments how costly and difficult the anti-counterfeiting fight can be. “The counterfeiters in China and the importers that buy from them are making millions trading off our goodwill,” Casey explains. “They’re making cheap, inferior and dangerous counterfeit versions of our products, but it is so frustrating when you try to stop them. I can’t even tell you how much time and money we spent on a lawsuit we electronicRETAILER | July 2012 http://www.naylornetwork.com/era-nxt

Table of Contents for the Digital Edition of Electronic Retailer - July 2012

Calendar of Events
Your Association Your Bottom Line
Industry Reports
FTC Forum
eMarketer Research
IMS Retail Rankings
Jordan Whitney's Top Categories
From the Executive's Desk
Cover Story: Could You Sell Like Amazon?
Counterfeiting: Why We Should Care and What We Can Do
All Media Are Not Created Equal
Guest Viewpoint
Inventor's Corner
Advertiser Spotlight
Bulletin Board
Advertiser Index
Rick Petry

Electronic Retailer - July 2012