Are look-alikes confusing? The application of the DRM paradigm to test consumer confusion in counterfeit cases

Marketing analysis shows that only about 3 % of products in the marketplace do not need packaging (Sudol et al. 2000). The packaging is not only for protection but also attracts consumer’s attention and makes products more distinctive than others. However, not every company creates their products to be distinguishable from others. Rather, companies consciously try to imitate market leaders using similar colors, shapes, style of lettering, or design of logo to mislead the consumer that such a product has the same quality as the original brand (AIM 2004; for a review see Zaichowsky 2006). Products that significantly resemble the overall appearance of well-known brands by combining the distinctive visual features that are inherent to the original product with the slightly differentiated features are called “look-alikes” (AIM 2004; Balabanis and Craven 1997). The use of look-alikes raises objections from companies that own the original products and who had invested money to create distinguishable packaging that lets them achieve a leading market position as well as from consumers who may be misled and unwillingly buy the wrong product. The last two decades have given rise to many lawsuits initiated by the manufacturers of branded goods who claim that the look-alikes confuse customers and, in consequence, make them purchase the wrong products (Balabanis and Craven 1997). Are customers indeed confused by look-alike products?

Most studies on customer confusion related to look-alike products do not focus on experimental testing of memory distortions, but are based on consumers’ opinions (ProMarka 2007), product similarity analysis (Kapferer 1995; Loken et al. 1986; Walsh et al. 2007, 2010), or situational factors of consumer confusion (Foxman et al. 1992). Balabanis and Craven (1997), for example, tested 50 shoppers when they were finishing their shopping and no consumer had falsely bought a look-alike product instead of an original.

However, another survey conducted by the Which? Group (2013) found that one fifth of the British participants reported having bought the wrong product because they were misled by the similarity of the packaging to that of the other product. Moreover, 30 % of the consumers felt misled and 38 % were annoyed by the fact of buying the wrong product. A survey conducted in Poland for the ProMarka—Association of Branded Goods Manufacturers (ProMarka 2007) found that 12 % of the clients were not aware that look-alike products exist and 32 % declared that they were not able to distinguish between original and look-alike products. Similar confusion among sport fans was also revealed for event sponsors—the participants had difficulties with correct discrimination between actual and foil sponsors of their teams and based their responses on the plausibility of a brand as a potential sponsor (Johar et al. 2006).

Studies show that look-alike products may disturb the perception of original brands due to weakening of the symbolism of those brands to specific social groups (Loken and Amaral 2013). Moreover, Johnson et al. (2013) conducted a research study commissioned by the British Intellectual Property Office that revealed that some consumers believe that products that look similar have similar product characteristics and similar origin. However, this effect was larger if the consumers have not used products within a particular product category. Although high numbers of consumers tested reported that the accidental purchase of look-alikes disadvantaged them, a substantial number of participants reported that such a purchase had some positive aspects.

In the present study, it was investigated whether brands from the same categories of products may elicit false memory and lead to recognizing of look-alike products as original ones that are usually the market leaders. It was hypothesized that one of the possible mechanisms responsible for consumer confusion might be spreading activation that occurs at encoding (Collins and Loftus 1975) and consequently, leads to associative memory distortion. Related concepts are linked in such a way that accessing one concept (e.g., door) sends activation across these linked pathways to related concepts (e.g., window). The spread of activation through the associative network primes related concepts and makes them more easily accessible. This activation process is automatic and not amenable to conscious control.

In a previous study, Nedungadi (1990) showed that conceptual priming of brands increased memory-based choice probability that may result from spreading activation (Collins and Loftus 1975). However, that experiment was limited to the products’ names and not to the products’ images. In the present study, the brands that had look-alike competitors regarding package similarities were chosen. It was aimed to test how the names and the images of the products activate memory traces. The experiment reported here was motivated by a desire to know whether category activation evoked by either a look-alike or the original product affects people’s choices in the same way. If differences are obtained, it would suggest that processes responsible for memory distortions happen not only at encoding but also at retrieval.

Moreover, this situation may relate to both product images (pictorial presentation) and product names (auditory presentation). With regard to product images, people are exposed to memory errors that stem from the visual similarity of products. This similarity concerns perceptual features of product packaging, such as shapes or colors. The more similar two products are from the same category, the more likely potential customers will be confused. In this situation, it is clear how memory is sensitive to distortions. Memory distortions may also concern brand names (auditory presentation). Usually, a brand name is strongly related to its image (e.g., packaging). Therefore, it is possible that the product name depicts specific characteristics (e.g., logo, colors, or shapes) that can easily be brought to mind after hearing it. For example, on hearing the popular brand name McDonalds, most people create a mental image of the yellow “M” letter. If a look-alike’s image was evoked following auditory name presentation, but only differed slightly from the prototype (the original), there is a chance of false recognition because the latter image is activated. This assumption is consistent with Paivio’s (1971, 1986) dual coding theory, which states that people have the ability to code a concrete stimulus in two different ways (pictorial + verbal).

If these associative memory distortions occur at the time of product encoding, it is thus possible that testing with the Deese–Roediger–McDermott (DRM) paradigm (Deese 1959; Roediger and McDermott 1995) will detect them. In the standard version of the DRM paradigm, subjects are presented with lists containing associated words (e.g., bed, awake, night, etc.), all of which are related to one nonpresented critical lure (e.g., sleep). Next, they receive instructions either to recall or to recognize words from the lists. Participants were found to falsely recall the nonpresented critical word approximately 40 % of the time, and the probability of recognizing critical lures as having been seen before was similar to the probability of recognizing studied words (Roediger and McDermott 1995).

Although the DRM procedure is widely used in memory studies, there are very few experiments that have applied this paradigm in the marketing context. Sherman and Moran (2010) applied the DRM paradigm to show how false memories were created for brand names. They presented the participants with brand names (e.g., Morrisons, Sainsbury’s, and Waitrose) either in brand appropriate fonts or in a plain font. Memory distortions occurred both for recall and recognition of nonpresented but the most popular brands (e.g., TESCO). Moreover, the brand-specific fonts at study had no effect on recall, but increased overall recognition.

Associative memory distortions were also revealed by Wagner and Kronlund (2005, as cited in Mantonakis et al. 2008), who showed higher susceptibility to falsely recognize major brands than minor brands or their associates. In addition, exposition to direct competitors of major brand or their associates led to false reports of having seen the former (Kronlund and Yoon 2007). Similar semantic interference was also observed in terms of conceptual priming and showed that exposure to prototypical brands increased false recognition for competing brands in the same category (Mantonakis and Yoon 2009).

Although the DRM procedure was used to test memory distortions for both pictorial and verbal material (Israel and Schacter 1997), it should be stressed that in the experiments described above, only false memory for brand names was tested. In the present study, the DRM procedure was adopted to test asymmetry in the recognition of original and look-alike products presented both auditorially and pictorially. It was attempted to demonstrate both the potential and limitations of the application of this paradigm in marketing practice and to test whether this kind of memory distortion might be influenced by presentation modality during encoding and retrieval.

Previous studies applying the DRM paradigm showed that differences in false memory rate depend on either encoding or test conditions (Gallo et al. 2001; Israel and Schacter 1997; Smith and Hunt 1998). For example, Smith and Hunt (1998) showed that, in general, visual presentation of words, when compared with auditory presentation, reduces the rate of false memory because studying pictures results in more perceptually distinct memories than studying words. A decrease in false alarms was also observed by Israel and Schacter (1997). They presented subjects with lists that contained words (word-only condition) or words with black and white drawings (picture and word condition). The rate of false recognition was lower in the second group. In both studies, the authors argued that the distinctiveness heuristic is responsible for the results. Thus, the more distinct information is provided at the time of encoding, the more easily subjects should be able to reject a lure (i.e., a look-alike). It is then possible that encoding and retrieval of stimuli, for example, a product shown in a double modality (pictorial + auditory simultaneously), may improve the memory for encoded items and reduce memory errors. A memory trace for encoded items should be more vivid and, at retrieval, the distinctiveness heuristic may be used. Moreover, subjects should be more accurate when using both auditory and visual modalities because information is processed in two separate streams that differ in how information is represented and stored in memory (Penney 1989; see also Broadbent 1956; Hede 1980; Treisman and Davies 1973).

To sum up, the main objective of the current study was to test the particular kinds of memory associative errors that occur for brands, both in relation to their images (pictorial presentation) and names (auditory presentation) and that are caused by dishonest marketing competition. It is predicted that the image and/or the name of look-alike products (exemplars) will elicit false memory of original products (prototypes) in the procedure similar to the DRM paradigm. Based on previous studies on the DRM paradigm and distinctiveness heuristics (Israel and Schacter 1997), it is also predicted that presentation of products both pictorially and auditorially will reduce the false memory effect and improve recognition of the presented products. Although it is well established that both pictorial and verbal presentations are superior to only verbal presentation in the DRM paradigm, this procedure was not applied hitherto to test the consumers’ confusion for brand names and packages.