MAP or minimum advertised pricing policy refers to a brand’s agreement with its resellers to advertise a price of the product at a certain point but not below it. The resellers can advertise a higher price for the product or at the price agreed upon but not below it as per MAP policy. The MAP policy does not stop the reseller from selling the product at a lower price though they can advertise only at the price they agreed upon or at a higher price. MAP should not be seen as a legally binding aspect but a mutually beneficial one for brands and resellers.
What is MAP monitoring?
Brands that care about the advertised prices of their products need to create a MAP policy first before they can start with MAP monitoring. MAP monitoring is when you constantly review the advertised prices of your products on your reseller’s websites. MAP monitoring is essentially checking for compliance with MAP policy and ensuring your resellers are not involved in any MAP violations. MAP violations give rise to price erosion because of the race to the bottom of pricing to attract customers. They also have a big impact on your profit margins, brand image, and encourage price wars that lead to a lose-lose situation for all retailers.
MAP monitoring is for every type of brand but especially those who are selling on a variety of ecommerce websites such as Amazon. Whether you are starting or you are a well-known brand, MAP monitoring is essential for every type of brand that wants to protect its margins and reputation in the long run. According to Intelligence Node, more than $2.5 billion are lost in revenue due to violations of the MAP policy, up to 80% of resellers are unauthorized, and brands suffer from a loss of 17% of their profit margins. Furthermore, 20% of products that are tracked using software report MAP violations! MAP monitoring is very important, to say the least.
Why should brands pay attention to MAP monitoring?
MAP monitoring is paramount for a host of reasons. The top reasons why MAP monitoring is crucial is because of the following.
Useful insights such as unauthorized sellers
MAP monitoring software gives you a ton of insights including unauthorized sellers who are selling your products. You can contact them and then turn them into authorized sellers by ensuring you share your MAP policy with them if you think the relationship will be fruitful. Else, you can take corrective actions to ensure they stop selling your products as they don’t have permission to do so. MAP monitoring also provides information about where your products are being sold and at what price. If you find the advertised price is much lower than it should be, you should take action accordingly to ensure your brand perception remains intact.
Prevention of price wars
When one retailer sells a high-demand product at a lower price, the others are going to follow suit because they want to capitalize on that opportunity. This only leads to price wars which is a messy situation for everyone involved and especially the brands. MAP monitoring ensures retailers are complying with the MAP policy to ensure the prices are advertised at a certain price. This prevents them from luring customers into their online store with highly discounted prices from brands that never approved of such a practice. Price wars harm retailers and manufacturers as it takes a slice of their profit margins.
Avoid lower profit margins
Brands that want to remain competitive must ensure they have a certain profit margin so they can grow their business and expand it. MAP monitoring enforces a certain price point at which products are advertised so brands can rest assured that they will have the profit margin they desired all along. MAP monitoring will ensure online prices are positively impacting the brick-and-mortar resellers. Let us online resellers are slashing prices way too much. When brick-and-mortar stores see this, they have to do the same to remain competitive. By enforcing MAP, you can save your profit margin and offer what your customers expect from you.
Positive relationship between manufacturer and reseller
MAP monitoring ensures a good relationship between the manufacturer and reseller. Manufacturers want to sell their products in places where resellers will respect their MAP pricing policy. When retailers do that, they will have a good relationship with the manufacturer and this is beneficial for both parties involved. For example, manufacturers will provide better discounts to those retailers who comply with the MAP policy regularly. This can lead to long-term mutually beneficial relationships. This is possible with constant MAP monitoring. A reseller can go around the agreement through loopholes but it will be in his best interest to avoid doing that especially if the brand is a reputable one.
Positive impact on brand perception
It is all about brand perception at the end of the day because you are at risk of losing your customers if they think your products can be obtained at a lower price. Let us say that a reseller constantly sells your products at half the price. This makes customers believe that your products are worth that much which is why they are being sold at such a discounted price. They will not find fault with the reseller but with your brand. MAP monitoring prevents this from happening and thereby ensures customers have a consistent perception of your brand. MAP monitoring has a positive impact on your brand reputation.
Protects brand reputation
You worked a day in and out to create a brand reputation. Do you want all your hard work to go down the drain only because some resellers repeatedly advertised products at lower prices? We don’t think so. Even if you were late in finding out about what the resellers did regarding MAP, building your reputation all over again is an uphill task that will require tremendous effort from your end and even then you might never get to that high level again. It is not impossible but it will take a lot of time. With MAP monitoring in place, your reputation is safe because you can tackle MAP violations quickly when they occur and rectify the issue so it doesn’t repeat.
How to go about MAP monitoring
MAP monitoring is challenging. The higher the number of resellers of your products, the higher the chance of MAP violations and the more difficult it is to keep track of all the vital information you need to protect your brand. Manually monitoring thousands of SKUs across multiple resellers is a big no-no because who has that sort of time in their hands? You have other things that require your attention. Even if you use spreadsheets to keep track, how long do you think it will take for you to check manually? You can save resources by using a MAP monitoring software tool as it automatically scours the web to look for MAP violations.
MAP monitoring software is the only way for you to monitor your product prices effectively and efficiently. MAP monitoring solutions automatically perform checks on prices across a wide range of SKUs. It alerts you of any MAP violations that have occurred and tells you where these violations have taken place so you can do something about them. This gives you time to focus on other important aspects of your business and grow your business. MAP monitoring software requires an initial investment but it can save you thousands of dollars later on and save aspects that go beyond money.
MAP monitoring software is crucial because it ensures profitable pricing that keeps your customers happy and your business going. By finding out about unauthorized sellers and rewarding sellers who comply with your MAP policy, you can ensure proper MAP compliance at all times regardless of the channels you sell on. Intelligence Node’s MAP monitoring software solution is the best software for monitoring MAP compliance and taking strategic actions against MAP violators in real-time.
Intelligence Node’s MAP monitoring software tool is AI-powered for incredible insights that can save your brand’s reputation. It has a 99% price matching accuracy and provides real-time notifications so you never miss out on MAP violations. It provides ZIP code level tracking for better results and shows you all the high-risk sellers who are likely to resort to MAP violations. The AI-driven software also unmasks counterfeiters so you can take action that is appropriate so it never happens ever again. You can book a demo to see what the software can do for you and your brand.
Also Read: Seo Company Primelis.