The MAP policy is a rather new concept in the marketing field and many companies are still unaware of what they are losing by not having such a policy. Today we are going to talk about the marketing changes that led to the need for a minimum advertised price, what companies need MAP policies, the benefits of having these policies and the best tools for preventing MAP violations.
Why MAP policies are necessary
As we already mentioned, this type of policy is a rather new concept. In the last decades, the internet has infiltrated all industries. Selling online was challenging at first due to shipping costs, poor communications and many other problems. In time, all these inconveniences were fixed, and nowadays it is easier than ever to sell online. As such, most companies nowadays have an online presence. This has has led to a very competitive market. In order to survive in this brave new market, many retailers had to cut down their prices like never before. Obviously this wasn’t great for manufacturers, as it was their revenues, but also the image of their brands. This was the environment that led to the need of MAP policies. The purpose of the policies is to prevent retailers from advertising products below the minimum price recommended by the manufacturers.
Which companies need MAP policies
There are two factors which would require a MAP program. First of all, you have to know if your retailers and distributors sell in online stores. While the internet has taken over most industries, there are still a few isolated businesses that haven’t yet converted to the online religion. For those businesses, a MAP policy doesn’t make much sense. The other factor that calls for the need of an online policy is the number of retailers and distributors with whom you are collaborating. If your business is still small and you have no retailers or you have a very small number of retailers, you probably don’t need a MAP policy.
Benefits of MAP programs
The main benefit of establishing a minimum advertised price, is that you gain a certain level of control over how your products are advertised. You must understand that for your customers, price equals value. So if your product is advertised on dozens of websites, with prices ranging from very low to very high, your product will be considered of low quality, which hurts the image of your brand. Moreover, if retailers sell at very small prices, this means that they aren’t making much of a profit. You may think that this isn’t your problem, but when a retailer is struggling financially, they are investing less in customer support and marketing. Keep in mind that your retailers can significantly affect the image of your brand. Last but not least, a MAP program will encourage a balanced and fair competition between your retailers.
Best tool for monitoring MAP violations
Having a MAP policy doesn’t necessarily mean that your retailers will abide by it. So, it is essential to monitor them to make sure that they won’t violate the policy. You can do this with the Trade Vitality MAP Monitoring Software solution, which automatically checks the online accounts on your resellers and instantly notifies you if it encounters any violations. This way, you can see when violations occur and you can take actions to prevent them from happening again.