What is eCommerce MAP?
E-commerce MAP (Minimum Advertised Price) is a pricing strategy manufacturers or brands use to establish the lowest price for retailers to advertise a product. Essentially, it’s the lowest price at which a retailer can advertise a product. While retailers can sell the product at a price lower than the MAP, they cannot advertise it at a lower price.
How does MAP pricing work in e-commerce?
Setting the MAP: The manufacturer or brand establishes the lowest price at which retailers can advertise the product. This price is usually communicated in the sales agreement.
E-commerce Monitoring Compliance: Manufacturers often use software to monitor online marketplaces, retailer websites, and other platforms to ensure that advertised prices adhere to the MAP policy.
E-commerce Enforcement Actions: If a retailer violates the e-commerce MAP policy by advertising below the minimum price, the manufacturer can take actions such as:
- Warning the retailer
- Withholding product supply
- Terminating the retailer’s agreement
What are the benefits of MAP price monitoring for manufacturers?
- Maintains brand image, values, and customer trust
- Prevents price wars among retailers
- Protects retailer profit margins
- Increase customer experiences
- Ensures fair competition
- Simplifies pricing strategy for retailers
- Optimizes pricing strategies based on market data
- Enhances brand consistency across sales channels
“Keep your products’ value high by setting a fair floor. Watch your partners closely, and make sure everyone plays by the same rules. A strong brand needs strong prices.” – Author
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