Minimum Advertised Price (MAP) is the minimum retail price the manufacturer sets for its product that resellers or retailers agree not to go below in advertisements. However, retailers may offer the product below the MAP by using discount coupons and offers. In simple terms, MAP is the lowest price a retailer can show online or in an advertisement, though it does not refer to the lowest price retailers can accept in their stores.
Is Minimum Advertised Price Legal?
Yes, under U.S. antitrust statutes, MAP is legal. It is not considered a form of vertical price fixation between retailers and manufacturers because it allows selling below the set price. Hence, it is legal, and retailers have an obligation to strictly follow the MAP policy.
Benefits of Minimum Advertised Price (MAP)
Manufacturers set MAP price on their products to maintain a brand image amongst consumers. MAP violation can have a devastating impact on a brand’s image. Consider this situation: a manufacturer discovers its $250 product priced on Amazon at $50. This deep discount may destroy years of hard work that established the manufacturer’s quality brand image and reputation in the market, essentially leading to brand erosion. With a MAP policy, unauthorized retailers won’t be able to destroy the brand image and negatively impact sales from honest and compliant retailers who respect the policy.
MAP violation can have a devastating impact on a retailer’s brand image.
Retailers usually try to be very price competitive to win market share. MAP helps prevent price wars between retailers and helps maintain good margins. However, with MAP policy, retailers shift their focus to factors such as after-sales service, shipping, and other customer-centric features. This is beneficial from the consumer’s point of view, driving them toward retailers who deliver an exceptional customer experience and shoring up brand loyalty. It’s essentially a win-win.
How Is MAP Price Enforced?
The process to enforce MAP pricing is to detect all MAP violators across various marketplaces and advertising platforms, proclaim MAP enforcement policy and, if needed, ban non-compliant retailers from selling certain branded products. This means it is crucial for retailers to use MAP compliance monitoring tool, analyze data and produce accurate evidence to swiftly report MAP pricing violations across multiple platforms.
GrowByData’s MAP Monitoring Software solves this retail industry problem. Along with our powerful price intelligence for your repricing strategy, our price monitoring software provides the added bonus of resolving key challenges to MAP violation monitoring and enforcement. Here’s how:
1. We Ensure Accurate Evidence: Our solution accurately matches your products at the variant level with other retailers across various platforms. We ensure this accuracy with a double-layer Data QA Process that incorporates both AI and human inspection.
2. We Monitor Across Platforms at Scale: Our solutions support platforms such Google Shopping, Google Ads, Amazon, Walmart, eBay, Target, and eCommerce platforms such as Shopify, Magento, BigCommerce, Yahoo, Volusion, 3DCart and others in different countries. Alongside these options, we can scale monitoring for various frequencies and for different timezones and different geographies. Today, we are monitoring MAP violations for different categories such as apparel, tools, industrial, health & beauty, electronics and more.
3. We Swiftly Alert Map Violations: Our solution quickly alerts you with accurate MAP violation reports separately in Amazon and Google. You can track violations in a SKU by different retailers across eCommerce sites and marketplaces. You have a snapshot of the violation that you can send directly to related parties for MAP enforcement.