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Why You Shouldn’t Worry about Every MAP Policy Violation

 
 
Why You Shouldn’t Worry about Every MAP Policy Violation
 
 

Every time a seller violates your minimum advertised pricing (MAP) policy, it feels like theft. Someone has sold your product for less than what it’s worth, and therefore robbed you of revenue. And to your other retail partners, that violation feels like cheating. It gives one retailer an unfair advantage—so everyone has to cheat, too, or else lose sales.

The stakes of each violation are high. It can permanently damage the integrity of your price (once consumers see the lower price, they may not feel like it’s worth paying “full price”). This price erosion also impacts the margins of every seller, because it triggers “race to the bottom” pricing, where everyone winds up selling near or at-cost, receiving horrible margins on each sale. Not to mention, as the price of your product drops, it becomes harder for consumers to distinguish between the real thing and a fake.

It’s a lose, lose, lose situation. So it’s understandable why you’d want to chase down every pricing violation.

But you shouldn’t. It may seem counterintuitive, but if you want to take pricing enforcement seriously, you can’t worry about every violation.

Here’s why.


There are more violations than you can possibly enforce

Depending on the size of your product catalogue and the number of retailers you work with, you could have hundreds of pricing violations in a single day—and each one is a unique situation, so you can’t really automate your responses. 

A day’s worth of violations represents more than a day’s worth of response work from your MAP admin. Plus, many sellers are bound to appeal your violation claim, which takes up more of your MAP admin’s time, because they have to elevate it to your legal counsel. 

If you try to act on every pricing policy violation, every day you’ll fall more behind. And that means when a big violation pops up, you may not have the capacity to give it the attention it deserves.


Some violations have a bigger impact

It’s hard to blame your retail partners for violating your pricing policy if someone else did it first. They’re playing follow-the-leader to keep from losing sales—and they may not even be doing it on purpose. Some retailers use automated tools to detect if a product is available for less at a competitor’s site. This helps ensure they don’t drop the ball and miss out on sales.

Typically, if you can deter those first violators, your other retail partners will abide by your pricing policy. So it’s more important to catch these culprits and dish out consequences than to pursue every violation. If the first domino never falls, the others remain standing, too.

Additionally, some of your SKUs are more important to your brand than others. It’s a bigger deal if someone violates the pricing policy on one of your flagship products than one that barely has sales to begin with.

We recommend brand managers focus on 5–10 percent of their SKUs to start, prioritizing the ones that are most important to your organization.

You can always adjust the list as needed. When you launch new products, it’s probably a higher priority to protect their prices than worry about SKUs toward the bottom of your list.

The reality is you don’t need to monitor every SKU—just the ones that have the biggest impact on your brand and your bottom line.

But that still doesn’t mean you’re letting retailers off the hook for their other violations.


Retailers are responsible for every violation

Ignorance of the rules is not an excuse for breaking them. Regardless of whether or not you inform a retailer of every single violation, they’re responsible for correcting them—as per your pricing policy, which they agreed to before they started selling your products.

So if you respond to a violation, you don’t actually need to list every single SKU to hold them accountable. (Although it would be courteous to tell them, especially if the list isn’t too long.)

And if a retailer asks you to tell them every SKU that’s in violation, it might be time to consider dropping them as a retailer. They’re probably never going to be compliant, and they’re clearly going to worry more about getting caught than policy compliance.


Protect your brand

Your pricing policy is one of the biggest tools you have to protect your brand’s integrity. But if you have a large product catalogue and numerous retail partners, it’s hard to keep track of every SKU, everywhere they appear. And even with good resellers, you’re bound to have more violations in a single day than you can possibly follow-up on.

That’s why we developed MAP Guard. Using our unique “spidering” technology, MAP Guard crawls every product page where your SKUs are sold and retrieves pricing information for you to evaluate, automatically flagging any page that violates your pricing policy. From there, you can easily prioritize the SKUs that matter most to you.

Want to see it in action?

Schedule a demo.

Category: Blog
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