Handbags at Dawn 2: fashion economics and design

First to speak after the coffee break was Nicola Searle, the Katonomist.  Nicola sought to describe and explain the points at which the fashion sector is the same, or quite different, from other sectors.  Since we don't discriminate between created works, some creative fashions are under-rewarded by an IP monopoly while others are over-rewarded. IP can also hinder the balance between the reward given to the initial innovator of a new design product and subsequent innovators.

Why are consumers so interested in paying premiums for status goods, or in buying counterfeit replicas? We  buy expensive goods in order to display our status. The best handbag today is the direct successor of the hunter with the best kill. Status signals only matter to people who know; they are far more effective in urban settings where people know less about each other than in rural settings, and they are more prevalent among people who are at the age at which they are capable of passing on their genes. The purchaser needs a reference group which can relate to the fashion purchase, and may send out counter-signals by deliberately shunning expensive and fashionable products as a means of showing his or her status and security.

Counterfeit goods send out ambiguous messages; they can both damage demand and increase it, and they do address the status needs of lower-income consumers. Within each reference group, there is a zero-sum game in terms of status, since each person's increase in status corresponds to someone else's diminution of status. Three types of consumer are identified by the economists: the snobs, the aspirants and the bandwagon. The snobs get to a fashion product first, followed by the wannabes. By the time everyone is getting on to the bandwagon, the snobs are already jumping off it.

A Wendy Brandes Swear-Ring: the idea
is simple, but protection is hard and costly 
Nicola explained how copying within the fashion sector can have the effect of speeding up the fashion cycle, making it necessary to innovate further.  Some elements of fashion, such as seasonal colours, can actually give economies of scale in terms of the bulk manufacture of dyes, fabrics etc.  And when clothing is in matching palettes of colour, consumers need purchase fewer garments in order to have a matching wardrobe.

Leading up to lunch, Aaron Wood (Briffa) reviewed the confusing condition of design protection for fashion in the UK, via national and Community design law.  He dealt with issues such as qualification of the protected party (do you have to be a UK or EU national in order to enjoy design right protection?), exclusions from protection (does it matter if your design is for a surface pattern rather than something more substantial?) and priority (can you still register a design if you have already sold goods which incorporate it?)

Tatty Devine: made good
use of social media in getting
the right result ...
Aaron then turned to the question of design litigation.  When can you get summary judgment? Not when there's an issue regarding ownership of the design and the chain of title, since that will have to go to trial. Do keep "splendid records" (SPLENDID being an acronym for Sales information, Pricing Information, Lifespan, Existing Designs and "Inspiration", Nature of Claim, Drawings, Identity of designer and assignment and Dates).

When deciding what to do about an infringer, decide your strategy: are you looking to frighten off small fry, to obtain publicity or to seek full relief?  Also, consider how an alleged infringer might respond to your moves. Defendants whose one product is an infringement of yours are more likely to stand and fight.
Handbags at Dawn 2: fashion economics and design Handbags at Dawn 2: fashion economics and design Reviewed by Jeremy on Monday, September 24, 2012 Rating: 5

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