Why do consumers buy counterfeit luxury products? A tale of two major cities in two different countries

The purpose of this paper is to examine customer attitudes toward purchasing counterfeit luxury products (ATPCLP) in two cities in two different countries (Saudi Arabia and Malaysia) by testing the relationships between the various reasons for purchasing those products: social status insecurity, status consumption and value consciousness.

Questionnaires were distributed conveniently to urban customers in Kuala Lumpur, Malaysia and Jeddah, Saudi Arabia. Altogether 658 useable questionnaires were collected and analyzed using descriptive statistics, general linear model of univariate analysis of variance and structural equation modeling.

Quality, price, popularity and status signaling represent the main motivating factors for their brand choices of counterfeit luxury products among the two country groups of customers. As expected, customers' social status insecurity influences their ATPCLP, but not their status consumption. However, status consumption does positively moderates the relationship of their social status insecurity and their ATPCLP. Furthermore, customers' value consciousness influences their ATPCLP and moderates the relationship between status consumption and ATPCLP. The impact of status consumption on ATPCLP depends on the importance one places on the value of the products. However, the authors found no differences in social status insecurity, status consumption and value consciousness, on their ATPCLP among the customers. Some implications and limitations of the results are discussed.

The use of convenience sampling and mainly college students (in Saudi Arabia) as respondents represent the main limitations of this study.

The practical implication of this study is to discourage the purchasing of counterfeit luxury products in their respective country Malaysian marketers need to stress that their genuine products are of top quality while Saudi marketers need to stress that their genuine products are of well-known brands that are sourced from well-known countries of origin. Besides, Malaysian marketers need to offer genuine products that are not overly priced or ones that indicate value-for-money while Saudi marketers need to convey the message that their genuine products could help enhance or uplift their customers' social status. In this study, the authors did not find any support for differences in ATPCLP between the two rather different Muslim-majority countries. This could be due to the fact that the majority of the respondents were females in their mid-20s and that both countries have a growing number of young customer base, which makes them particularly attractive target customers for branded/luxury products and, at the same time, easy preys to luxury products counterfeiters. This implies that there are still more opportunities for academics to study the topic or related topics in the future.

As far as the authors know, no one has undertaken a comparative study involving two very different Islamic majority countries (more conservative mono-cultural and mono-ethnicity Saudi Arabia versus less conservative multicultural and multi-ethnicity Malaysia) before.