Illicit trade is a persistent and growing threat, as technology, the global economy and e-commerce open new opportunities for counterfeit products to infiltrate supply chains and provide consumers with illicit products. Many understand the risks—that illicit trade can cause serious public health issues, and that the proceeds from illicit sales fund other criminal activities. Others view some form of illicit trade as the soft underbelly of the global economy— the price to be paid for frictionless trade.
A new study from Oxford Economics seeks to understand this evolving issue better—specifically, the attitudes and behaviours of those that influence the demand and the supply for illicit goods, so that illicit trade can be contained. We surveyed more than 37,000 consumers, across 37 European countries, buying five products; cigarettes and tobacco, alcoholic drinks, films, music and games, clothing and accessories and medicines.
This research helps to dispel four commonly held misperceptions about illicit trade:
This report introduces a new way of segmenting consumers of illicit goods by analysing their motivations as well as their complicity to participate in illicit trade to create four distinct segments: Bargain Hunters, Opportunists, Critics, and Activists. From these profiles we can identify how the spread of consumers and their receptiveness to different policy responses varies by country and product.
In addition, we surveyed more than 8,000 businesses, policy officials and law enforcers (collectively referred to as “stakeholders” working to combat illicit trade. By comparing with the results of the consumer survey we highlight some areas where their perspectives appear not fully aligned; for example in how to influence consumers, the extent to which consumers are aware of the risks and the implications of illicit trade, and the lack of confidence in the legitimacy of goods bought online. This points to specific policy and strategic responses, such as more attractive business models, improved product authentication, action to secure e-commerce supply chains, and public awareness campaigns. Stakeholders seem aware of the shifting nature of illicit trade and are refocusing their priorities. Implementation, however, is patchy, with many businesses, policy-makers, and law enforcement agencies recognising that there is much more to be done. It’s difficult to secure resources, particularly when competing against other initiatives and priorities.
There are plenty of reasons to be optimistic, however. The study reveals a strong preference among consumers for the security of legitimate goods and authorised channels, and concern about the implications and victims of illicit trade that could be reinforced through public awareness campaigns. This study aims to provide detailed information, by product, country, and several demographic factors, to help guide efforts to both improve enforcement actions and steer consumers away from buying illicit goods.
Click here to see the research home page, where you can access the main findings report, spotlight reports for each country, and use an interactive dashboard to explore the survey results by product and country.