Minimum Advertised Price (MAP) Agreements & Amazon
March 23, 2022
Establishing your brand on Amazon can be a difficult, daunting task in an ever-growing marketplace where marketability and differentiation – both brand and product – is more essential than ever before. Creating a fair, competitive marketplace by requiring online resellers to adhere to an established minimum price is important for protecting and growing your brand.
What Is Minimum Advertising Price (MAP)?
Minimum Advertised Price (MAP) is the minimum price a manufacturer sets for product resale. Distributors and resellers are not permitted to advertise or resell products online for less than the manufacturer’s established MAP. When resellers agree to the terms outlined by the manufacturer, they sign a MAP agreement to ensure a level playing field and promote fair competition between all resellers. This agreement ultimately protects the brand.
The Importance of MAP Agreements
Undercutting established pricing is a common practice with the goal of achieving more sales and reviews – leading to higher product ranking. Because this predatory sales tactic can quickly damage a manufacturer’s reputation, MAP agreements are essential to maintaining brand image and credibility.
MAP adherence is also essential for reducing the number of rogue resellers who can create a host of problems for manufacturers and brands. Rogue resellers are defined as any seller who is not transparent with manufacturers as to who they are as a company and who often violate guidelines set by the brand, especially MAP. Violating a brand’s MAP agreement can damage a brand’s image and reputation by creating issues regarding competition for distributors and resellers and marketplace uncertainty.
Why MAP Is Critical to Your Brand
Consistent product pricing enhances brand identity and protects your reseller market. Strong MAP agreements help prevent “race to the bottom” pricing wars and promote balanced competition between small buyers and large companies who can afford to buy in bulk and offer lower prices. With the same products available across multiple retailers via mobile, online, or in-store, consumers often shop around for the best price and expect a frictionless shopping experience.
MAP agreements allow for all resellers on Amazon to share the “Buy Box”. Essentially, MAP agreements ensure that all distributors and resellers are granted the same ability to earn healthy margins on goods sold. As distributors and resellers become savvier to the online space, inconsistent pricing leads to lower confidence in resellers’ ability to make sales.
Ensuring MAP Adherence on Amazon
Once a manufacturer creates and implements a MAP policy, devoting time and energy to enforcing it is critical. Ensuring pricing consistency across all channels and platforms builds reseller confidence in the manufacturer and helps protect the manufacturer’s brand image. If a manufacturer’s pricing policy is not upheld with swift action against those violating its policy, the MAP agreement loses credibility and can create long-term enforcement issues. MAP monitoring programs are available to help brands stay on top of MAP compliance.
The ZQUARED Advantage
ZQUARED helps Brand Partners create, monitor and enforce MAP agreements with distributors and resellers on Amazon. We partner with brands to proactively and reactively ensure brand consistency, helping to identify and rectify issues with rogue resellers as needed.
Strengthening all aspects of the Amazon platform for your brand is a top priority. We work with brands to develop end-to-end solutions that focus on growing sales through advanced brand optimization and marketing, strategy execution, proprietary technology, forecasting tools, logistical support, product distribution and more.
To learn how ZQUARED can help you stay ahead in the Amazon game, request a comprehensive assessment of your Amazon channel from our Amazon Investment Partnership Team. You will receive audit results focused on your listings, category, competitors, reseller landscape and more with an individually-tailored strategic plan designed to capitalize on opportunities.