Influencers Capitalizing on Designer Knockoffs: Getting Paid to Promote Chinese Replicas

A rising trend in the counterfeiting landscape involves social media influencers actively promoting illegal knockoffs sourced from Chinese websites, exploiting platforms like Facebook, TikTok, Discord, and Reddit. Pandabuy, among the prominent entities in this niche, reportedly recruited thousands of content creators to participate in its marketing program during the previous year.

This illicit trade operates by connecting Western consumers with Chinese websites that host marketplaces abundant with counterfeit products typically sold within China. Influencers, in turn, earn commissions for endorsing and facilitating sales on these platforms. The situation poses a significant challenge for technology companies striving to curb the surge of fake goods propelled by influencer marketing.

In December, Nike filed a lawsuit against Fox, accusing him of collaborating with Pandabuy to promote counterfeit versions of Nike shoes. Although Fox disputes the allegations, his lawyer, Joe Southern, states that they are working toward resolving the case. Pandabuy’s responses to WIRED’s questions were directed to a customer service representative named Yaya, who mentioned that the company lacks the expertise to authenticate the products it lists.

Influencers associated with Pandabuy and similar platforms endorse a wide range of counterfeit items, from fake Chanel badminton sets and Skims dresses to knockoff Stanley cups. They share links to product listings, allowing ecommerce sites to track orders and compensate influencers with commissions.

WIRED’s investigation delves into the workings of this ecosystem by analyzing retailers’ websites, documents shared in private Discord servers, and publicly available videos and spreadsheets. Some influencers even promote counterfeit self-help books and vintage-looking fake Chanel bags with artificial water stains to give them an aged appearance. Fox, in particular, has showcased knockoff Ferrari car keys in a TikTok video, suggesting their use to impress someone on a first date.

TikTok’s advertising rules and community guidelines explicitly prohibit the promotion of counterfeit products. The platform asserts that it suspended the accounts of several influencers after being alerted by WIRED about their activities. TikTok spokesperson Mahsau Cullinane stated, “We continuously enforce strict rules against counterfeit products, invest heavily in detection and reporting, and provide an IP Protection Center for brands.”

Counterfeit and pirated goods make up an estimated 2.5 percent of global trade annually, according to a study co-authored by the European Union Intellectual Property Office and the Organization for Economic Cooperation and Development. Facebook and Instagram are among the most popular channels for purchasing counterfeit items. A survey conducted in 17 countries found that 68 percent of people who bought knockoffs on social media did so on Facebook. Meta, the parent company of Facebook, did not respond to requests for comment.

Chinese ecommerce sites, aided by influencers, are experiencing rapid growth. According to Daniel Shapiro, SVP of Strategic Partnerships at Red Points, the detection of counterfeiting by Chinese sellers increased by 26 percent in 2023 compared to the previous year. The process involves influencers leveraging shipping agent services, such as Pandabuy, to find counterfeit versions of popular products. Pandabuy scrapes millions of product listings from Chinese marketplaces like Taobao, translates them into English, and presents them to foreign audiences. The site allows influencers to earn money by referring their followers to make purchases, with elite influencers gaining access to an invite-only Telegram channel for exclusive sales events and content tips.

Influencers navigate shipping agent sites to identify high-quality counterfeit products, sharing them through affiliate links. When a purchase is made using the affiliate link, the influencer earns a commission. Pandabuy, for instance, reported over 15,000 influencers joining its affiliate marketing program in 2023. If a customer buys a counterfeit item through an influencer’s affiliate link on Pandabuy, the company purchases it from the original Taobao listing. Pandabuy then sends the purchased counterfeit item to the customer’s preferred location after taking photos for approval. This process allows customers to receive detailed previews and choose shipping preferences.

Google removed the site and other counterfeit sellers from its search results after being informed by WIRED. Molly Shaheen, a Google spokesperson, emphasized the company’s prohibition of the sale or promotion of counterfeit goods on its Shopping and Ads platforms. Tech platforms face ongoing challenges in tackling counterfeit sellers, particularly from China. While Chinese courts have seen an increase in handling intellectual property cases, small- and medium-sized knockoff dealers are often challenging to apprehend. Influencers in the United States may encounter legal risks, as seen in Nike’s lawsuit against a sneaker influencer accused of leading an organized counterfeit trafficking community.