Fake Apple Stores in China

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New images emerged on the web yesterday of a fake Apple Store in China selling what appears to be genuine products. The pictures were taken by a British expatriate who blogs under the name BirdAbroad. What gumption these fakers have. Try doing that anywhere in the US and your store will be swarming with undercover agents before you can even say the phrase “Jobs is back!”

There is a fascinating OPM (Other Peaple’s Money) aspect to this arrangement. It’s obvious that the cost of building and filling the store with expensive merchandise was not paid for by Apple. But knowing Apple’s obsession with the customer experience, we can be certain that they are not happy with the idea. Any other company would have said, “You want to fund our growth and build stores? Go right on ahead. How many of our computers would you need to do that with? Where can I ship it and when can you take delivery?”

Apple does not enter into franchising or licensing agreements for this purpose. Every legitimate Apple Store is owned and operated by Apple. So, if you walk into a fake store and you’ve never seen a real store before, you’ll probably think you were in a legitimate company owned store. In this case the give-away was the fact that it was not listed on the Apple website.

What is the big deal, anyway? Why is this illegal and why is it in the interest of Apple to take action to protect their brand? The simple answer is because Apple is the rightful owner of the brand. Anyone who has ever used Apple products know that they set a very high bar when it comes to quality and aesthetics. They have spent an inordinate amount of money and resources over the years to create one of the most admired and trusted brands in the world.

The overarching concern here is that nobody has a clear understanding who these fake Apple Store owners are. If they are knowingly selling Apple’s merchandise illegally, then at best, what you have are unethical individuals who are profiteering by criminal means. At worst, you have a full-blown criminal enterprise representing the Apple brand and maybe even laundering money. So you can’t be sure that the “Apple Geniuses” behind the counter are really geniuses at all. They may just be willing participants in some organized crime syndicate dressed in colorful Apple garb.

A hypothetical: What if for instance a bad batch of computers were sold by that store? That’s probably the test for any company. If it is a legitimate store, a high level of customer service can be expected. This is where customers are usually retained by companies as lifelong users, if not advocates of the brand - when things go bad and the company saves the day. If the person dealing with the problem is a wannabe-genius, things might not turn out the way Apple would have expected and a customer walks away and never returns.

Intellectual property rights include the name and every other image associated with it. The individuals who built this store is likely experiencing success only because of the reputation that Apple has built over the years. So, Apple should have every right to control how that name is used and how to best benefit from that goodwill. That really is what property ownership is all about. Knowing Apple, they have probably known about this before the pictures became public. As a result, a group of geniuses are likely plotting a game plan in a way that would not compromise the brand. That means a solution that is infused with great finesse and an example of elegant design. Put in other words, these guys are toast.

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