- Costco was just ordered to pay Tiffany & Co. $19.4 million after selling rings under the “Tiffany” title.
- This isn’t the first time that the merchant’s approach to designer manufacturers has raised questions, as seen with a 2013 Michael Kors litigation.
- Customers are losing interest in designer brands like Kors and Ralph Lauren.
Costco’s capacity to sell designer brands like Ralph Lauren and Calvin Klein is a attraction for funds shoppers.
On the other hand, regions of the merchant’s strategy’s legality is being called into question.
On Monday, a federal judge ruled that Costco owed the jewellery company Tiffany & Co.. $19.4 million after the budget merchant sold gemstone engagement rings utilizing the Tiffany title.
While Costco had contended that the word was known as a standard reference to a ring’s setting, not the brand name itself, a court decided in 2015 that selling things described simply as “Tiffany” infringed on Tiffany’s trademark.
This isn’t the first time Costco was accused of falsely advertising designer products.
In 2013, Michael Kors sued without being authorized to sell them for supposedly marketing the designer’s handbags Costco. According to the lawsuit, Costco advertised $99 Michael Kors handbags, but did not actually stock the bags in shops (and wasn’t authorized to do this). The companies settled the case out of court at 2014.
Costco also offers a history of selling exactly what Refinery 29 predicts “grey market products”– designer things that were obtained through channels that aren’t illegal, but that are unintended by the original manufacturers. Aspirational designer brands like Michael Kors and Ralph Lauren don’t want to get linked to Costco, but sold there nonetheless.
Designer manufacturers “may have an abundance of fabric, or fabric might have come because did not meet their standards,” Marshall Cohen, chief industry analyst at The NPD Group, informed Refinery 29. “They can not sell it openly on the off-price marketplace, so that they market it to the warehouse shops.”
Costco did not instantly respond to Business Insider’s request for comment on its layout brand plan. In addition to concerns, the designer brand business of Costco is in also as a result of customers’ growing disinterest with aspirational brands.
Actually, as customers’ need for designer manufacturers, Costco continues to be growing that the Kirkland brand. The merchant now sells everything from maternity wear to vodka beneath the Kirkland title.
source http://www.christyjewell.com/costco-tiffany-rings/
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