Sure there are many reasons for purchasing a luxury item, but I guess that one of the main ones is to awaken admiration from almost everybody, i.e. from the vast majority that cannot afford it. Admiration that will be directly related to the exclusiveness achieved thru its very high price.

So what happens when fake items are commercialized? That you destroy brand value, because people that cannot get the original item, get a fake one and give the impression (if the copy is good) that they are carrying the real one...

If this is the case of fake items (that can be eventually discovered), imagine the situation when you consider original items that can be rented!

There are ways in which you can compete against fake items, but the situation gets more complicated when people that would not purchase the item under normal conditions, can give the impression of owning it by renting it.

If the number of rented luxury purses increases dramatically (as the fake ones are currently doing), what I predict that it will happen, is that the demand for these items will collapse. Because loyal customers will not be up to paying for something that “regular” people can show up and look for other alternatives that cannot be copied at ease, or decide to start renting for themselves.

What can the brand do about this? On the one hand, keep attacking with al legal resources the fake purses traded. Many initiatives have been taken and other can also be considered. On the other hand, try to stop these companies of renting the purses. They have to find a solution. If not, I foresee a dark future for these brands and their luxury items.

Do you know about any other similar situation? What would you do if you were in charge of a Luxury brand like Chanel?

Prof. Ignacio Gafo