Is a Minimum Advertised Price (MAP) Policy Right for Your Business?
It may seem like a complex question, but the truth is, pricing policies are not an ideal solution for every brand. While they are beneficial most of the time, if price is your primary competitive advantage, compelling sellers to increase their advertised prices might negatively affect sales. Typically, when we collaborate with a brand, we help them grow by expanding into superior wholesale distributors and enlarging their dealer networks. Consequently, this raises brand awareness and boosts sales.
However, a robust enforcement strategy alone cannot guarantee growth in brand value. Several other factors contribute to it, including marketing and research and development. While “the more you pay, the more it’s worth” might make for catchy song lyrics, it isn’t always accurate.
If you determine that a pricing program is suitable for your brand, consider asking yourself a few more questions. The most critical question is whether you are prepared to stop selling to a good customer. Enforcing a MAP policy requires the willingness to sever ties with anyone. We have observed that manufacturers who are ready to cut off anyone actually need to cut off fewer people. It is like a strict parent; kids test the boundaries when they know they can get away with it, but they are more likely to stay in line if there are consequences. Also, ask yourself if a dealer is genuinely a good customer if they undermine your efforts to maintain a fair market for your other dealers. Support customers who adhere to your policies, pay their bills, and contribute to your overall growth. Rest assured, consumers will find and purchase your products, regardless of the source.