Combating copycatting in the luxury market with fighter brands

Abstract We examine the effectiveness of using a fighter brand to combat copycatting in the luxury goods industry. In our research setting, the copycat product has a high resemblance to the luxury brand manufacturer’s original product, so customers may purchase the copycat product to gain the status utility. We find that the manufacturer should launch a fighter brand if the copycat product has a low resemblance to the original product. Moreover, the copycat will be less likely to enter the market when the manufacturer releases a fighter brand. Some insights regarding consumer surplus and social welfare are also provided.