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Piggybacking on Brand Value: The Economics of Free Riding in the Accessory Market
Brand recognition is everything in the modern global consumer economy. Companies, such as Apple, Garmin, and Samsung, spend billions every year building trust, loyalty, and aesthetic appeal around their flagship products. But once a product is widely adopted, an entire secondary industry springs up—third party firms making accessories that are compatible with the high-end brand but not made by it. This is a textbook case of free riding on brand value, one of the few economic principles widely covered in university classes on industrial organization and microeconomics.
Understanding Free Riding
Free riding means that one party receives a benefit from the investment or effort of another party, and somehow does not pay for it. In the accessories space, third-party manufacturers pretty much “piggyback” on the general reputation and demand of branded products. For example, an iPhone-compatible charging cable company doesn’t need to spend money on marketing the iPhone. Apple had already done the heavy lifting—building a customer base, innovating, and marketing. All that the third-party company needs to do is be compatible and charge less.
Another perfect example of this is the Garmin replacement strap market. Being one of the leading brands in the world of smartwatches and fitness wearables, Garmin always invests heavily in building sturdy products. But as soon as a device such as the Garmin Forerunner or Fenix gets released and becomes a hit, dozens of online retailers and manufacturers flood the Amazon and eBay marketplaces with third-party versions—often in more colors and styles, and cheaper than the original.
Economic Forces Driving the Trend
A few economic forces are at play in the spread of third-party accessories:
Information symmetry through reviews and ratings.
Finding a reputable brand, which was once a challenge, has now devolved into scouring online reviews. This gives consumers the freedom to experiment with non-branded options.
Price sensitivity and segmentation
Not every customer is prepared to pay $29 for an Apple charging brick or $39 for a Garmin-branded watch strap. Third-party manufacturers target the price-conscious segment of the market through cheaper pricing, thus increasing the penetration of the product.
Access to global manufacturing and supply chain
The ascendance of global suppliers—most notably in China, Vietnam and India—has scaled down the costs of production and delivery dramatically. It allows small firms to enter the market and scale quickly without having to invest in brand-building expenses.
Platform economies and visibility
Marketplaces such as Amazon, AliExpress, and Walmart Marketplace, provide third-party brands instant visibility. Algorithms typically rank products based on price, reviews and volume—not brand legitimacy.
Real-World Data
To demonstrate the scale of free riding, consider Apple. Apple’s accessories business, including AirPods, cables, and adapters, hit over $41 billion in revenue in 2023. However, research from CIRP (Consumer Intelligence Research Partners) shows that more than half of iPhone users consistently buy third-party charging accessories (either online or in-store). It means billions of dollars are left on the table and going straight back to third-party businesses that haven’t done anything in terms of building the brand they’re effectively profiting from.
The Garmin ecosystem has a similar problem. Garmin does sell official replacement straps for $29–$49, but a quick Amazon search turned up hundreds of compatible options retailing for $6 to $15, many backed by thousands of positive reviews. Such third-party retailers can leverage Garmin’s product popularity without investing in R&D, testing, or customer acquisition at all.
Ramifications and Trade-Offs
On the one hand, free riding gives consumers more choices and more affordability. On the other hand, there’s a trade-off. For brand owners, too many third-party accessories can negatively impact profits on high-margin add-ons. It also has possible quality control risks—a badly manufactured cable or strap could damage the core product or create a negative brand association even though the brand had no hand in making it.
In response, Apple and others have developed certification programs, including a licensing program called MFi (Made for iPhone), to license accessory makers and retain some control over the process. Garmin and others may only sell warranties to cover servicing of official accessories, luring you back to the branded fold.
Conclusion
The free riding conduct of third-party accessory manufacturers illustrates a core dilemma of modern capitalism: the ability to maximize consumer surplus vs. the ability to maintain intellectual and brand capital. Manufacturers like Apple and Garmin push their innovative quality of their smartphones and smartwatches, while off-market competitors ride the waves and profit with the winds of opportunity with no investment into value building. So long as consumer demand for cheap, compatible accessories remains strong, the economics of riding the piggybacking of brand value will continue to be a powerful—if controversial—force in global retail.
