Counterfeit Products on the Internet: The Role of Seller-Level and Product-Level Information

The Internet makes it possible for counterfeiters to sell imitation goods without prior consumer inspection. Counterfeiters leveraging this opportunity may use product presentation and Web site signals to represent counterfeit goods as genuine. Based on deception and signaling theories, it is proposed that counterfeiters use product presentation to manipulate signals that might otherwise identify a product as a fake and Web site trust signals to present themselves as legitimate business entities. An experiment demonstrates that advanced product presentation has a positive influence on user perceptions of the authenticity of products and increases user willingness to buy on-line. The absence of Web site trust signals provides significant evidence of the untruthfulness of a seller and decreases users' willingness to buy on-line. The results of this study provide the basis for a cautionary note to on-line buyers and will help prevent deception by sellers of counterfeit products who use advanced presentation techniques.