When launching new products on Amazon, the last thing you want is for resellers to get a hold of them and drastically reduce pricing against your MAP enforcement guidelines. That’s why Amazon MAP enforcement is important for Amazon sellers. With the cut-throat competition and aggressive pricing on Amazon, resellers can do price undercutting to win the Buy Box and increase their profit margins. This can hurt your brand’s value and profits.
Even though brands have MAP policies in place, some resellers do not follow these policies and this is for two reasons. First, unauthorized resellers are reselling products on Amazon without approval from the brands they are carrying. So they care less about maintaining brand value.
The second reason is competition for the Buy Box, which prompts sellers to lower prices. Since Amazon doesn’t enforce MAP agreements, failure to enforce your MAP pricing on Amazon can lower your profit margins, and taint your brand’s value.
In this section, we’ll look at the importance of MAP pricing for brands and how to enforce map pricing on Amazon.
Why MAP pricing is important for your brand
To enjoy healthy business growth and a profitable outlook, MAP pricing policies are a great way to level the playing field, both on Amazon and outside. By definition, a minimum advertised price (MAP) is an agreed-upon minimum price that a reseller can advertise the product for sale.
Most brands on Amazon have MAP policies to protect their brand value and profit margins. Since Amazon does not enforce MAP policies, it has become such a chore for brands to enforce MAP policies.
Amazon’s primary goal is to offer the cheapest prices to win sales at all costs. Therefore, they really don’t care about MAPs. It is solely up to brands to form the agreements and make their resellers agree to them. There are several steps that brands take to enforce these policies.
The following are some of the benefits of MAP pricing for your brand:
- Preserves your brand’s value
- Helps to identify unauthorized resellers
- Helps to maintain good profit margins
- Protects small resellers from unfair competition by larger retailers
Does Amazon care about MAP pricing enforcement?
No, Amazon mostly doesn’t care about enforcing your MAPs, nor do they care about preventing resellers from lowering the prices significantly. Amazon does not recognize Amazon MAP pricing policies, so they won’t get involved in enforcing the agreements. It is upon you as a seller to form the agreements and make your resellers agree to them.
Most online marketplaces for e-commerce retailers do not really care about MAP pricing because their primary goal is to win sales.
How to communicate your MAPs effectively
One first step you can take to make sure that your Minimum Advertised Prices are kept at their policy level is to communicate them well. Bad communication regarding your Amazon MAP pricing policy leads to misunderstandings between brands and resellers and it often leads to many issues.
It’s best to let your current distributors and retail buyers know the minimum price for a product that they cannot advertise below. Communicate your brand guidelines clearly and let them know you are policing the marketplace to ensure they comply with your Amazon MAP pricing policy.
3 steps to enforce your MAPs on Amazon
Step 1: Directly communicate violations to any Amazon seller
Even though you may roll out an Amazon MAP pricing policy for your authorized sellers, some sellers may still not follow those policies. Unfortunately, Amazon leaves all the policing to brands and does not penalize resellers who violate Amazon MAP pricing policies.
One of the best ways to prevent rampant MAP violations is to directly communicate the violations clearly to any Amazon seller who violates your Amazon MAP pricing policy.
You can send a cease and desist letter when you identify a violator. The letter should point out the policy being violated.
If the violation is not resolved, you can go ahead and place a hold on distribution or revoke their authorized seller status.
Step 2: Sign up for Amazon Brand Registry
Another great strategy for Amazon MAP enforcement is to sign up for Amazon Brand Registry. Getting brand registered on Amazon gives you access to powerful reporting tools and robust brand protection resources.
Some of the Amazon MAP enforcement tactics that work for authorized resellers may not be effective for preventing counterfeiters and unauthorized sellers from violating your MAP policies. This is why it’s important to get Brand registered on Amazon.
Though Amazon Brand Registry isn’t meant for preventing Amazon MAP violations, it can help to protect trademarks.
With the registry, you can restrict the number of authorized sellers that are allowed to sell your brand and you can easily detect infringements on your trademarks and flag those resellers within the marketplace.
Typically, registered brands are more protected when it comes to trademark violations than non-registered brands.
Brands can also enforce MAP pricing on Amazon by utilizing an automated price monitoring solution to monitor the entire marketplace. A price monitoring tool can alert you whenever resellers violate your Amazon MAP policies.
Step 3: Track distribution channels to detect any MAP violations
Amazon MAP violations and unauthorized reselling on Amazon happen because brands do not keep track of their supply chain.
When you don’t keep tabs on your key distribution channels and retail partners, it’s easy for your Amazon MAP pricing policy to be violated. One of the most effective ways to prevent these violations is to know who you are selling to and who they’re selling to along the supply chain.
You can easily tell if a distributor or retail partner is undercutting prices by looking at the amount of business they do with you. Unusual increases in purchase volumes and frequency could be an indication that sellers are violating your Amazon MAP pricing policy. So you may want to dig deeper to find out if indeed they’re undercutting MAP pricing.
Also, a simple Google search can help you find out if a distributor is violating your MAP pricing policies.
If you have the name of a seller that you’re suspecting they could be undercutting MAP pricing, a Google search can help track their website or product listings on another marketplace. You can even go the extra mile and purchase from them.
For sophisticated MAP pricing violations where you’re unable to identify the seller’s identity, it’s a good idea to enlist the services of a professional investigator to help you with unmasking Amazon MAP violators.
These tactics can help your Amazon brand reclaim control over pricing and protect assets for a healthy business outlook, both in 2021 and beyond.
Having a comprehensive Amazon MAP pricing policy in place and enforcing it the right way can preserve the premium nature of your brand and eliminate perceived commoditization.
Your MAPs should reflect your branding efforts
MAPs are a key indicator of your business success, but they’re also a way to come through with your branding in a positive manner, especially on Amazon.
By creating effective MAP policies and enforcing them consistently on Amazon, brands can protect their profit margins and maintain a consistent perception of brand value to consumers. It also promotes fair competition between small retailers and larger retailers.
What makes Amazon MAP pricing enforcement difficult?
Photo by Oleksandr Latkun from NounProject
There’s no doubt that MAP enforcement is a tough challenge for many sellers. This is especially true for sellers that distribute to a large network of resellers. Tracking a large distribution network of resellers can be overwhelming.
Another aspect that makes Amazon MAP enforcement a hard task is the fact that Amazon doesn’t recognize MAP pricing policies, so they don’t take part in enforcing them. It is up to brands to come up with the agreements themselves and enforce them on their own.
Moreover, Amazon won’t penalize resellers who violate Minimum Advertised Price agreements. Enforcing MAP pricing on Amazon is even more difficult for US sellers because they don’t have to disclose legal business information on their storefronts.
Despite these challenges, sellers will need to continuously monitor MAP pricing on Amazon to ensure their MAP policies are enforced and protected.
As a seller, if you don’t monitor MAP pricing on Amazon, resellers can continue to undercut pricing in an attempt to attract more customers. This will not only taint your brand’s true value but will also reduce your margins alongside many other consequences.
Keep Amazon MAP violations in check with the help of Emplicit
Don’t know how to enforce MAP pricing on Amazon? Emplicit can help because we are one of the most trusted Amazon marketing agencies around. We leverage advanced tracking solutions to monitor your product’s prices to ensure complete MAP policy compliance and protection. Get in touch with Sunken Stone today for reliable MAP enforcement.
