One of the massively violated policies Amazon has supported to ensure quality and safe shopping experience for customers and fair revenue for sellers is their MAP or Minimum Advertised Price policy.
If you are a 1st party or 2nd party Amazon seller, you might want to enforce brand policies in light of MAP to maximize your profit and keep you highly qualified for the buy box through the help of Amazon advisors. They are experts at helping brands craft an e-Commerce strategy to protect their MAP pricing and trademark online.
What is MAP Pricing and Why is Controlling MAP Enforcement on Amazon important?
MAP or Minimum Advertised Price is a policy most manufacturers and brand owners mandate their authorized resellers and distributors to comply if they want to do the business. In there is a rule indicating the price floor, or also known as the allowed lowest selling price, resellers and distributors must follow both in their online and physical stores. There is a clear difference between MAP pricing and price maintenance agreements. The former dictates how much the product should be priced in the advertisement. Meanwhile, the latter dictates at least how much should a product be sold which means that prices below that are unauthorized.
For instance, with MAP policy, brand owner A mandates distributor B to not advertise their product for less than $50, i.e. the $50 is the stipulated MAP or the minimum advertised price. The agreement is to be set forth in the contract and should distributor B violate it, brand owner A can rightfully terminate the contract as soon as he wants.
Majority of brand owners and distributors, a.k.a. 1st party and 2nd party sellers, can smoothly resume their business on Amazon without the fear of any policy violation since the distribution or reselling has been officially authorized by the former. However, the case with 3rd party resellers is different. Their tendency to violate the MAP is high since they are the ones who never sought permission to the brand owner. Their reselling is considered illegal and they would even go as worse as selling counterfeit and knock-off items at a price far lower than the MAP just to lure gullible customers. This is why controlling MAP enforcement on Amazon is an even more necessary undertaking for brand owners and manufacturers.
”As a brand owner, how can I enforce our MAP policy?”
Unfortunately, Amazon neither recognizes nor cooperates in the enforcement of MAP agreements made between you and the resellers (both authorized and unauthorized). As the burden will be fully yours to bear, you will want to go the extra mile in enforcing your policies. You cannot count on Amazon either in identifying which sellers have violated your MAP policies since legal business entities are not usually disclosed upon Amazon registration.
The Enforcement Work
The scope of your MAP enforcement works will depend on your distribution network’s size. If you have contracted with many distributors, your number of resellers can dramatically rise as well. This means more people will be competing for the buy box. With that being said, managing and controlling MAP enforcement on Amazon will require professional skills and time as it can also detrimentally affect your relationship with your recognized distributors if done wrong.
The following are helpful steps and tips that can be taken to ease the enforcement process:
- Identifying your key resellers and distributors is the first step. Your MAP enforcement project should begin by identifying your current resellers and distributors and sorting the list according to the size of their market with the biggest distributor on the top. Once the list is ready, proceed on reviewing them one by one and check whether their product listings are still adhering to your MAP policy. You can monitor this easily and efficiently if all your products have serial numbers.
All distributors who have violated are best terminated especially if they only contribute less to the bottom line of your business. Although this is an unfavorable undertaking, it will effectively help curb the number of your MAP policy violators.
Tip: You might want to keep an eye on distributors who have had significant sales improvement, which can reflect on the number of views and reviews the listing has received, as this could imply a possible MAP undercutting.
- Seize the violators. One way to do this is by sending the violator a cease and desist letter. This remedy effectively works in eliminating MAP violators on Amazon. If you wish to send yours, do seek help from Amazon experts and an attorney in making a safe but bold letter. It should clearly identify which policy was violated and the settlement options you are offering to resolve the issue.
- Establish a Product Warranty Nullification. This can discourage unauthorized resellers from selling an item purchased from you since the warranty is automatically voided once the purchase has been made. That is if the reseller cares for its customers genuinely and does not have any intention to milk money out of deception.
- Restrict your authorized distributors from selling on Amazon. This way, you have the sole ownership of your Amazon market. However, the threat against 3rd party, unauthorized resellers still remains.
- Enroll in Amazon Brand Registry. Amazon Brand Registry is Amazon’s program that is designed to offer beneficial perks to registered sellers, including the right to use special marketing features that will help enhance their credibility and visibility. It is what can set you apart from your distributors, both authorized and unauthorized. How? Although the enrollment is free, one of the requirements to be qualified in the brand registry is that your business should be trademarked and a bearer of all necessary documents. This is something only you have as the brand owner.
- Invest in a digital price monitoring program. The program can notify you as soon as violators are spotted, after checking the pricing of all product listings under the same category on a regular basis. This will also help you stay on top of your competition as the latter’s prices will also be indicated in the program’s report.