The best eCommerce brand strategies cover all aspects of the business - identity content and customer journeys. It's a full-time job to stay on top of those fine details. But what about straightforward price? It might be your customers' biggest consideration. So today we're talking about how to protect your business by ensuring your products go for the right price.
Minimum agreed pricing (MAP) policies are set by brands to specify the lowest price at which their products can be advertised. If a seller knowingly and consistently advertises goods below their MAP the brand who owns the intellectual property is well within their rights to cut ties with that seller entirely. Usually that means losing the right to sell everything from that brand not just the product in question.
Research the way your country views MAP policies very carefully. It's important to point out that these apply to the price at which a product is advertised not necessarily the price at which they're sold in the end. For this reason MAP policies are legal under US antitrust laws. However British and Australian authorities disagreed in 2018 and 2019 respectively fining brands for trying to implement and enforce MAP.
Setting and agreeing a MAP with everyone selling your products carries several key benefits. These don't only help your business; they also level the playing field and secure consistency for sellers who stick to the rules. First and foremost it protects your brand integrity when customers see products sold at a reliable price. If you're selling premium products something that typically goes for hundreds of dollars seeing it advertised for way less can knock that perception of exclusivity. MAP agreements stop this happening.
Not only that these agreements give smaller sellers a fair chance against the big players. Massive companies can afford to cut prices if it means selling in serious volume. Setting a reasonable MAP creates conditions which stop newcomers being leveraged out of the game.
Thirdly and perhaps most critically it protects sellers' margins and stops underpricing. This might seem obvious but in eCommerce where price is so central to a buyer's decision-making process it's good policy to prevent a race to the bottom.
Amazon won't help brands enforce MAP policies. In fact they don't officially recognize these agreements at all. It's in Amazon's best interests to keep their marketplace as free as possible. Stepping in to help dictate prices would be a mammoth administrative task for them and would risk slowing down sales.
As per their website: Amazon respects a manufacturer's right to enter into exclusive distribution agreements for its products. However violations of such agreements do not constitute intellectual property rights infringement. As the enforcement of these agreements is a matter between the manufacturer and the retailers it would not be appropriate for Amazon to assist in enforcement activities.
If you're experiencing issues with MAP violations you're on your own. For that reason it's important to have robust processes in place for if and when they occur.
If you've found that a seller or sellers are in violation of your MAP policy you'll want to take action and protect your brand. On a case-by-case basis the process might look something like this:
If you don't have a MAP policy in place and resellers start undercutting prices you're limited in how you can respond. You'd need to make a solid case to Amazon that the reseller is breaking the rules; look at the fine details of how they're processing warranties for example. Approach Amazon with these details:
� The product title its listing and associated ASIN/ISBN numbers
� The name of the seller or business you're reporting
� Your own order ID
It's possible this will be enough for Amazon to revoke the reseller's right to sell on the platform. However it may also be that the reseller isn't violating any rules and can continue to undercut you. A MAP policy is the best most reliable way to prevent this kind of thing happening.
You obviously don't want to spend the rest of your eCommerce career playing whack-a-mole with MAP violations whenever they arise. The best approach is to be proactive and set clear standards for what you expect from resellers before you start working with them.
Don't allow any blind spots where unscrupulous sellers might try and hide. Stay on top of your presence on the digital shelf no matter where you're selling. You might opt to track all this data yourself but that's unlikely to be appropriate for big businesses and certainly won't scale.
Instead there are solutions out there which track your presence across every channel and do more than simply checking that MAP is being followed. You can see which channels are performing well optimize listings and monitor your search performance instead of only focusing on one thing.
It's always a good idea to get yourself listed in Amazon Brand Registry. From a MAP perspective it helps Amazon understand more about your brand and its intellectual property. That makes it more likely that the platform will side with you if disputes arise.
But as with the previous point it also unlocks so much more. You get access to better reporting and the ability to show customers more relevant marketing content. It's another example of where being proactive about MAP carries extra business benefits.
Placing unique serial numbers on products lets you track them which is especially useful if you suspect a reseller is violating MAP. With your products serialized you can make a test purchase if you see someone selling your stuff below the agreed price.
The serial will tell you exactly which distributor is responsible and you'll have caught them red-handed. This also helps when people sell under different names Amazon doesn't always insist that sellers disclose their real identity.
Protecting your eCommerce brand strategy is a long-running battle. But it's one you can win if you're clear and consistent with your partners. For big companies it might even be worth having an honest conversation about which resellers are worth working alongside. If someone's causing problems there are plenty of potential distributors who will be happy to play fair.
In the end taking a proactive and data-driven approach is going to arm you with the facts to act when adversity strikes. It's about so much more than price it's about your reputation. That's something that's always worth investing time and effort into securing.
