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With online shopping growing, brands must ensure they and their business partners share common goals to stay competitive. One way to achieve this is by setting up Minimum Advertising Pricing (MAP) policies.
Our content helps Amazon sellers understand that MAP violation is imperative for brands seeking to maintain a competitive marketplace. These violations undermine a brand's pricing strategy and damage consumer trust and integrity. Therefore, a strategic approach to dealing with MAP violations safeguards a brand's image and develops a more transparent relationship between brands, retailers, and consumers.
In this guide, we’ve discussed what MAP violation is, why brands should monitor it, and how to address it effectively.
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A MAP policy violation occurs when a reseller promotes a product at a lower price than the agreed-upon amount set in a MAP policy, a pact between manufacturers and retailers. This often happens in highly competitive online retail when reselling on Amazon attracts potential customers with discounts.
The chance of MAP violations rises when non-compliant sellers utilize repricing software, either temporarily breaching MAP or automatically lowering prices in response to market competition.
Neglecting to monitor MAP violations Amazon can pose significant challenges for brands, as outlined below:
The issue extends beyond Amazon, as online shoppers habitually compare prices across platforms. Failure to track the MAP violation increases the risk of customers contacting unauthorized resellers offering products below the minimum advertised price.
When consumers encounter a brand's products at exceptionally low prices, it may not necessarily attract them. Low prices misrepresent the brand's value or raise the chances of counterfeiting or involvement in the gray market among potential customers.
A new research study from the Harvard Business Review showed that unauthorized retailers broke these policies half the time, while authorized retailers had a 20% violation rate.
Overlooking MAP violations negatively impacts a brand's partner network. Brand owners rely on their distribution channels and carefully select retailers. Non-compliant distributors and unauthorized resellers damage trust in business relations, causing disruptions throughout the entire distribution chain.
MAP violations directly impact profit margins, leading to revenue losses for brands and resellers. The combined effects of diverted customers, reputation damage, and non-compliant distributors contribute to overall revenue loss.
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To safeguard your brand against the risks above, actively addressing MAP violations is crucial. Here are some tips to tackle MAP violations effectively:
Make MAP violation tracking a non-negotiable aspect of brand protection. Understand that enforcing rules and ensuring compliance go hand in hand. Utilize technology-based tracking solutions such as Amazon PPC agency to manage and reduce MAP violations.
Stay connected with your distribution network at all levels, emphasizing the importance of compliance with MAP policy agreements. Research from Harvard Business Review suggests that actively notifying resellers, where legally permissible, when they breach MAP policies improves overall compliance.
Systematically monitor and address MAP violations by assigning a dedicated team member or task force responsible for overseeing and enforcing compliance across marketplaces. Be aware that some brands may lack the workforce to handle in-house tracking; external assistance becomes essential.
Brands with extensive networks of resellers operating on third-party marketplaces and engaging in offline retail may find tracking all activities related to MAP policy compliance challenging. In such cases, collaborating with a specialized full-service Amazon agency with expertise and technology-based solutions can be a viable alternative.
MAP policy violations occur when resellers promote products below the agreed-upon price set in the policy, often driven by competitive pressures. Failing to monitor a MAP violation on Amazon can result in diverted customers, disrupted distributor relationships, and significant revenue losses. To address these risks, brands should prioritize MAP violation tracking. You can get in touch with SwiftStart, a premier Amazon CRO agency to sell like crazy on Amazon.
SwiftStart can help optimize your Amazon listings and supercharge your sales in a jiffy. Swift offers FREE 1 ASIN report (Amazon PPC audit), affordable Image stacking, A+ recharge, SEO Listing, and PPC services to enhance your product listing, visibility, and sales. Moreover, our Amazon Catalogue Course will help you become an experienced Amazon seller.
Also, if you want to streamline your brand's operations without hiring an agency, our 450+ Amazon SOPs Library is your solution. So, don't miss out on the opportunity. Contact us today and take the first step toward elevating your Amazon brand's CRO.
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MAP violation means when a store promotes a product at a low cost compared to what the manufacturer has set as the minimum advertised price.
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