This is the first post of our two-part series, A Beginner's Guide to a MAP Policy.
If you’re already familiar with the what, how, and why of a MAP policy, jump to our guide for setting up a monitoring and enforcement process.
This is the first post of our two-part series, A Beginner's Guide to a MAP Policy. If you’re already familiar with the what, how, and why of a MAP policy, jump to our guide for setting up a monitoring and enforcement process.
MAP policies seem to be popping up everywhere.
What the heck is a MAP policy? How do I get started with monitoring my policy? I’m sick of manually trying to find a needle in a haystack. Is there a way to automate the MAP enforcement process?
It doesn’t matter where on the spectrum you are, it’s time we all get on the same page.
Let’s start at the basics of the MAP policy world. We’ll answer questions like, what’s a MAP policy? How did MAP policies come about? Why does every brand need one?
This will give you a fundamental understanding of MAP policies. You may need to revisit this section a few times as you start map monitoring and enforcing your policy. It’s your rhyme and reason, the “why” behind every email you send, deadline you set, and consequence you evoke.
Don’t worry, we won’t leave you hanging. We’ll take you through a step-by-step guide of a MAP enforcement process that’ll kick your violators to the curb. Our system includes introducing your new policy to your sellers, contacting violators that we identify, measuring benchmarks, and regularly updating your network.
Are you ready?
WHAT’S A MAP POLICY?
The minimum advertised price (MAP) is the lowest price that can be publicly displayed for a product on sale. A MAP policy is enacted by a brand to ensure their seller network doesn’t advertise their products below a certain price.
WHERE DID IT COME FROM?
A decade ago, the hurdle to selling online was a big one. It was a space reserved for the younger, less risk-adverse, early adopter types. There were limited services targeting new retail businesses and existing brick-and-mortar shops wanting to make the switch online. You were on your own.
Yet, technology is an amazing thing that’s grown and developed quickly - almost too quickly. Now there are services like Shopify, Magento, eBay and Amazon storefronts that make selling online a breeze by removing the barriers to entry and by minimizing risk. Not to mention the many other peripheral and niche services specifically catering to online retailers. There’s no point to try to fight the online world, but learn the ropes to work with it - the amount of online sellers is now too enormous.
As online retailers started to appear, they often resorted to discounting, promotions, and lower prices to get a leg up on competitors and stand out. They still do. It’s a become a game of how low can you go? This leave little room to compete on anything other than price.
Because of this, brands and distributors often mistrust the online guys since they’re selling their products at lower price. With the ability to compare products across the web and all the pricing intelligence software, the discounting will eventually spread through a brand’s seller network quickly. The problem is that the 'best price' business practice creates a race to the bottom and misguided sellers will ultimately erode a brand's image. There's no longevity.
Since it's now incredibly easy to put products online and discount, minimum advertised price (MAP) policies started to show up on the scene to control the downward spiral.
WHY DOES EVERY BRAND NEED A MAP POLICY?
A brand without a MAP policy is like peanut butter without jelly - the formula won't deliver the desired result. It should be part of your business’ DNA.
It’s the fuel that encourages your sellers to promote your products and drive consumers to pay for your brand name. It’s your first line of defence against protecting your brand and maintaining your profit margins.
Who doesn’t want to maintain profit margins?
Introducing and proactively enforcing your MAP policy indicates your long-term commitment and investment to your seller network. Often times, brands forget that their sellers are their customers. Customers are the blood to your business, and anything other than putting your customers first will cause some major headaches down the road.
Just like any relationship, you need to put in the effort to strengthen your partnership - it’s not a one-sided thing. By simply saying “hey, we have you in mind 24/7”, you’re giving your sellers the confidence and reassurance that they will have adequate margins to invest in and educate themselves.
In turn, they can advocate and sell your products with the right professionalism and competence. It’s a rub-their-back, rub-your-back kind of deal.
If you aren’t protecting your brand image and value, you’re destroying it.
You’ve put in the blood, sweat, money, and tears to make, produce, and market your product and build up a brand name. Yet, it only takes a few sellers to take it all away.
Your financial success depends on your ability to recoup a healthy profit. Savvy sellers understand that they must maintain their profit margins to benefit from the groundwork that you’ve done. A MAP policy insures that your sellers follow best practices and avoid eroding the your brand’s position within the market, so everyone in your network can win.
Just like any team, your brand equity is only as strong as the weakest link within your business.
It’s the bread and butter to every successful MAP policy: a consistent, repeatable process. Catch our second post of this two-part series where we dive into the how to start MAP monitoring in 30 days.