China's Manufacturers Now Producing Copies Before Original Products Are Even Launched
from the taking-the-tachyonic-train-to-Shenzhen dept
Techdirt has written a number of articles tracking how China is moving beyond its traditional counterfeit imitation culture to one of collaborative innovation, as exemplified by "gongkai". An article on the Quartz site provides a useful update on this world, concentrating on developments in Shenzhen, generally regarded as China's hardware equivalent of Silicon Valley. Things have now progressed from simply copying top-selling products, to spotting future winners on the Web:
Thanks to the internet, factories and designers looking for the next hit product can easily turn to Kickstarter, Amazon, or Taobao to see what gadgets are hot.
The article describes how nimble Chinese operations even produce their own versions before the original is released. For example, Yekutiel Sherman, an Israeli entrepreneur, came up with a design for a smartphone case that unfolds into a selfie stick. After months of research and design, here's what happened:
one week after his product hit Kickstarter in December 2015, Sherman was shocked to see it for sale on AliExpress -- Alibaba's English-language wholesale site. Vendors across China were selling identical smartphone case selfie-sticks, using the same design Sherman came up with himself. Some of them were selling for as low as $10 a piece, well below Sherman's expected retail price of £39 ($47.41). Amazingly, some of these vendors stole the name of Sherman's product -- Stikbox
As the article goes on to describe, enforcing traditional monopolies like patents is so difficult as to be pointless, thanks to the highly-fragmented and fluid nature of Shenzhen's ecosystem. Instead:
Businesses are now forced to come to terms with this new reality. It’s not enough to create a product with a groundbreaking design or features, like a smartphone case that turns into a selfie stick. Companies dealing in the creation of physical goods now must make products that are impossible to copy exactly from the get go, by focusing on a special feature they can protect, or creating a coveted brand name consumers will pay more for.
In other words, the competitive environment in Shenzhen is driving the uptake of approaches that Techdirt has been advocating for years. That's good for customers, who enjoy a greater choice and more rapid innovation as a result, but this shift can be good for companies too, as the Quartz article notes:
Joffe, the venture capital investor, argues that some companies might even benefit from copycatting, as it can bring more awareness to the product itself. "If you have more customers buying the fake product then it creates more awareness for the real product, and it becomes an aspirational thing. At some point they might be able to afford the real thing."
It's well worth reading the whole article for its description of the Shenzhen scene, even if regular Techdirt readers will find the main ideas there extremely familiar.