(The Wall Street Journal) – In China’s “fake world,” consumers can shop for furniture at an imitation IKEA store, eat a six-inch sandwich at an outlet strikingly similar to Subway, and then grab dessert at Dairy Fairy, The Wall Street Journal reported Wednesday
Welcome to the modern era of copying in China, in which sophisticated proprietors of knockoff stores and chains are targeting increasingly sophisticated Chinese consumers with store experiences and customer service extremely similar to the real thing, down to the helpful store maps, coupons, shopping bags and employee uniforms.
The imitation retailers and restaurants go beyond the simple fakes of consumer goods that have long been abundant in China. Indeed, in some cases, they aren’t even selling fake goods. The phenomenon gained global attention last month when a foreign blogger in the southwestern city of Kunming posted photos of a fake Apple Store selling real iPads and iPhones in a setting remarkably similar to Apple Inc.’s trademark retail outlets, and identifying itself as an Apple Store without the US company’s permission.
Copycat stores range from small regional operations, such as IKEA-copycat 11 Furniture, which runs two stores, to larger Dairy Fairy-type national franchises.
The fake stores present new complications for global companies that have long struggled to protect their brands in China. Some executives say that fake stores can help build brand awareness. And in cases of unauthorized resellers like the Apple store in Kunming, the foreign company is still benefiting from sales of its own products.
Alexander Moody-Stuart, managing director at sandwich chain Subway, said the number of imitators that come to franchising fairs in China increases every year.
For Subway, which is trying to build awareness to a type of food that isn’t always eaten in China, “the mimicking isn’t exactly a bad thing,” Moody-Stuart said.
But the imitation stores can limit the companies’ ability to control the experience that consumers have with their brands. Copycat companies run the risk of tarnishing a consumer’s association with an already established brand at a time when Chinese consumers are increasingly brand-conscious.
To some degree, the copycat stores illustrate that there’s demand that’s not being met, because some foreign companies haven’t expanded into huge swaths of China’s interior, said Torsten Stocker, a Hong Kong analyst for Cambridge, Mass., consulting firm Monitor Group.
Still, some proprietors say their company’s similarity to known brands is a coincidence. At Jambo Juice in Beijing, where smoothies are made on-the-spot so consumers can add so-called energy boosters and opt for antioxidants, the green signs and tropical colors are familiar to anyone who has ever patronized US-based chain Jamba Juice, which doesn’t have outlets in China.
But Jambo’s founder, Ye Jiabin, says he got the English name from an African language (it is a greeting in Swahili), and is now considering changing the name because it is too similar to the US company.
Source: The Wall Street Journal