If you’re a manufacturer, retailer, or any other brand that sells things online, then you need to concern yourself with MAP Policies – or MAPP for short. This is an acronym that stands for minimum advertised pricing policies, and they play an essential role in the online universe. Essentially, the minimum advertised price refers to the absolute lowest price that someone can list a product online or in an advertisement. Please note; this isn’t the minimum price they can actually sell it for, it’s just the lowest that can advertise it for sale.
Throughout this short guide, we’ll tell you everything you need to know about MAP policies. This includes why they’re important, and the different types of policy out there too.
Who enacts a MAP Policy?
MAP policies are typically enacted by the original manufacturer of a particular product. After they’ve created the product, they put a policy in place that means other retailers can’t advertise it for lower than the minimum advertised price. Generally, manufacturers that implement MAP policies will continuously check to see that people are following the policy, and if they find sellers that aren’t, they can stop them from selling their products.
When a MAP policy is enacted, it’s done so by the manufacturer without any agreement with resellers. They don’t have to work with them to come up with an agreed MAP, it’s all down to the manufacturer.
Why are MAP Policies important?
These policies are important as it helps protect manufacturers from having their goods severely undercut by other sellers. It can also benefit the businesses that sell the products by allowing a fair competition to take place. Without a MAP, many small businesses could end up in a price war with cost-cutting big box stores that can afford to advertise the same product for a much lower price. It’s a policy that’s designed to help pricing strategies and avoid situations where everything is advertised for as low a price as possible, which ends up ruining the market.
What types of MAPP are there?
There are many different MAPP types out there, and it all depends on what the manufacturer decides is best for them. There’s something called a Hard MAP policy, which is when a manufacturer sets a minimum advertising price and that’s it, there’s no flexibility on it, so you have to advertise it for not even a penny less.
Then, you have an IMAP policy, which stands for Internet Minimum Advertising Price. This covers price listings and advertisements that happen online, rather than ones that are print based ads, etc.
You may also hear talk of a unilateral minimum advertised price policy (UMAP), but this is essentially the same as a regular MAP, it’s just another term for it.
MAP policies are crucial for manufacturers and retailers all over the world. As a manufacturer, you want to implement these pricing policies to ensure that your goods aren’t advertised at a price that you deem to be too low. For businesses and retailers that re-sell products, you need to be aware of the MAPP’s in place to ensure you don’t break them as it can lead to a manufacturer completely cutting you off and refusing to let you sell their products.