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4 Reasons Brands Should Implement A MAP Policy

by Eric

Numerous studies, including Neilsen’s, show that people factor in price to determine whether they will purchase products online. Pricing is undoubtedly important and this is where the MAP policy comes into the picture. A MAP pricing policy consists of guidelines that are created by manufacturers to ensure retailers are advertising at the lowest price specified by the manufacturers.  If your brand doesn’t have a MAP pricing policy then you should do so because of these 4 major benefits.

Helps Improve Compliance:

When you have a MAP policy in place, it is your way of telling retailers what they can do legally and what happens if they violate the guidelines specified. Without a policy in place, violations can be rampant. Violations can lead to price and brand erosion. Implementing a policy helps improve compliance among your authorized resellers and retailers as they are all aware of what price they can advertise at. This can help you be in control always and it improves your relationship with them. Read more about A Great Insightful TikTok Analytics Tips To Enhance Your Business.

Protects Your Brand:

MAP policy monitoring can help you protect your brand. According to Intelligence Node, 80% of online sellers are unauthorized making MAP pricing policy monitoring a must. A MAP pricing strategy can help protect your brand because you get to control the price at which your products are shown. You have control of cutting off your relationship with sellers who violate the policy too. As you get to decide how consumers view your brand’s products, you get to protect your brand and get legal control over how the products are priced which is important in how consumers perceive your brand.

Better Profit Margins:

When you implement a MAP policy, you will have better profit margins because you have clearly stated in the policy the price at which your retailers can advertise your products. When a product is advertised at a certain price, it has a higher value compared to products that are constantly sold at low prices which eventually have a low value. When you have a policy in place, retailers will sell at the price you have specified and so this will lead to better profit margins. This will positively impact your brand and your authorized resellers.

Price Wars Are Prevented:

Price wars are not desirable because they lead to loss of brand value. When a MAP policy is put in place, retailers who are competing with each other cannot start a price war. In the beginning, price wars may seem beneficial because more consumers will purchase from the retailer but this affects future sales. Not only will profits decrease but customer loyalty will reduce too. As consumers associate lower prices with bad quality, they will start to view your brand as one that sells bad quality products which is what you want to avoid. This can be prevented with a MAP policy.

MAP policy creation is easy but enforcement is where many brands get stuck. You can look for a MAP policy enforcement solution that will enable you to monitor and find out who is violating the policy. An example of such a solution is by Intelligence Node which offers an AI-driven MAP monitoring solution that can help increase your margins by 15% while reducing compliance costs by half. Opting for a MAP enforcement solution can make it easier for you to conduct business.

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