Carrying on – now, the most likely time when you might have somewhat ‘legit’ companies producing counterfeit products using your IP is when there is consumer demand and the Licensor has not provided a legal/official alternative licensee in the market to supply that demand.
This is a very important distinction as it is much harder to stamp out piracy when you don’t have a legitimate/official licensee in the market as an alternative to the counterfeit product, and arguably (save for reasons mentioned above related to ceding brand positioning) one might question what is the point of clearing the market of pirated product prior to being able to offer an alternative.
This speaks to the need for a licensor to be able to move quickly with its licensing program because the single most effective weapon or tool against piracy is offering an official licensed alternative. Where this situation becomes the most critical and obvious is when – for whatever reason – a new character/brand takes the world by storm and overnight is suddenly the new flavor of the month, and the licensor or owner in this case does not have an existing licensing infrastructure to quickly service this demand.
Indeed, whereas working with retailers to ensure they are carrying officially licensed product is usually one of the most effective means of sidelining counterfeit product, in certain markets you will have very powerful retailers that, in the event that official licensed product is NOT available, will actually commission the counterfeit merchandise themselves, seeing it (somewhat dubiously) as an obligation on their part to serve their clients.
So getting the REAL licensed product into the market is the most important thing the licensor can do, and is from there really the starting point for taking other various actions to combat piracy.
Not done yet! Back soon with more on “The Piracy Paradox”