When in Shanghai: Part 2

Upstairs, Downstairs

The Chinese boomtown Shanghai is a city of juxtapositions. There are the ones you expect: ancient buildings standing behind glittering towers erected as recently as 15 years ago; traditional neighborhood noodle restaurants sharing a block with Starbucks; or Mercedes-Benz taxis parked alongside rickshaws. But for me, on my recent visit, one of the most stark and surprising juxtapositions was the retail scene.

Beneath the Museum of Science & Technology in Shanghai, the most visited modern museum in China, lies a tourist attraction with realistically more draw than the museum could ever hope for: AP Plaza, a.k.a the “fakes market.” It’s a cavernous maze of individual stalls selling the literal retail underground: designer knock-offs of everything, including watches, sunglasses, handbags, shoes, scarves and umbrellas, even cosmetics. Many of the counterfeits perfectly mirror the luxury items they are ripping off, down to the tiniest detail. Even if the booty is tantalizing, the experience is stressful. Sellers are extremely aggressive and the setting dingy and disorganized.

Just across town, very much above ground, are some of the most massive, swanky and impressive retail stores I have ever seen. Here is where you’ll find the authentic versions of those luxury items. The stores themselves are opulent, ultra-luxe showrooms, with spectacular visual merchandising and highly trained and polished sales people. And the items themselves are ones of great tradition, quality and even greater expense.

I was a shopper in both of these very different worlds this past week. What struck me was that the tie that binds them both: brands. The allure of brands, and the power they have to reward us, fulfill us, validate and make us feel special, is a unique but global phenomenon. There would be no fakes market without the brand love and desire engendered by legitimate brands, sold at “real” retail, over the span of generations.

Does buying your second fake Louis Vuitton bag in a dirty basement under a museum qualify you as brand loyal? Do fakes leave the shopper with the same pride of ownership and joy from the purchase and subsequent use of the real thing? Do throngs of shoppers carrying fake bags marginalize buyers of real goods?

The matters of brand loyalty (or brand fascination, perhaps) and pride of ownership can get murky. But I think there is little doubt that a sea of fakes muddies the waters of global retail and cheats buyers of authentic goods. But, regardless, it begs the question: Just what is the true value of a brand? It is a question that threatens, to some extent, the luxury end of retail. I do not believe the fake versions of their products are stealing much revenue. For the most part, people who buy the fakes are unlikely to purchase the real thing anyway. But what is being stolen is brand cachet and reputation.

I remember clearly the first time I bought a designer handbag. I had saved for it and was excited to go buy it but also a bit nervous about the price. The very chic, older saleswoman sensed this and said, “Don’t worry dear, I was your age when I bought my first one, and we will both be buried with these bags. They are timeless and of a superior quality.” I felt satisfied and smart, like I was making an important “investment.”

Buyers of knock-offs, of course, are getting as close as they can afford to get to being a part of a brand-name club. Those who can afford the real thing usually buy it, paying the high price to participate in the whole luxury brand experience. They are buying into the opulent store setting and stylish sales people as much as they are buying the actual designer bag or timepiece. But when they see their prize possessions filter down to the masses not just in imitations but exact copies of the same product, does it tarnish the privilege of ownership?

It’s tough to envision a resolution for this divide. While vendors of fake goods around the world get policed and shut-down from time-to-time, the source of these good knock-offs is a thriving component of the Shanghai economy. It may be underground, but it’s a major tourist attraction with barely the hint of impropriety or dishonesty.


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Sharon Love

Sharon Love is CEO of retail marketing agency, TPN. To Sharon, "retail is a verb". It's not a place, but a state of mind where people can shift into a shopping mindset anywhere, anytime. As consumers become better-informed, smarter shoppers, Sharon challenges herself and the agency to evolve with them. Beyond her business savvy, she is an avid shopper, consumer, reader, traveler and wanna-be chef.



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