Automating Minimum Advertised Price Monitoring: A Blessing for Businesses

In today's day and age, every entrepreneurial genre is inundated. Businesses, regardless of their scale and type, are compelled. They must find unique and unbeknownst strategies. It is to survive and stay afloat. There are various approaches to product marketing. This includes leveraging third-party institutions. They are such as resellers ad retailers have become commonplace. They enable companies and manufacturers to increase brand visibility and sales. This fosters organic growth. Selling products through third-party institutions may seem rosy and hassle-free. However, when we dig deeper, a fact becomes clear. The phenomenon comes with its fair share of problems.

There is one huge problem businesses face. It is while dealing with third-party sellers. The problem is the non-complicatedness with the pricing policy. To attract more and more potential buyers, resellers optimize their prices. They do so at times, to an abysmally low level. Such a move may lead to price wars, detrimental to the brand as it hampers its image. Thus, the minimum advertised price monitoring phenomenon appeared in retail. It is to ensure some form of base-level control over prices. What is MAP, and how can it be automated? Let us find out!

The Working Policy of MAP: How to Manually Monitor MAP

The minimum advertised price monitoring (MAP) is the lowest price. It is at which manufacturers or brands allow third-party sellers. They are retailers, eCommerce sites, and distributors. They promote and sell their products. The basic process of manually monitoring MAP includes the following –

Identifying the resellers and the product pages. It is where the minimum advertised price is breached.
Take a screenshot of the product page to prove that the reseller has violated the MAP.
Reach out to the reseller and inform them to update the price as per the MAP policy.
Regular examination to see if the reseller has updated the item's price
Suppose the reseller or third-party site fails to update the product price. It is in tandem with the MAP agreement. You can then drop the reseller and pull out your products from their platform.

What Justifies the Use of Minimum Advertised Pricing (MAP) Agreements?

The relevance of minimum advertised price monitoring is more pressing than ever. eCommerce accounted for 19 percent of global retail sales in 2021. The number will only increase soon. Thus, brands and manufacturers must establish a viable business model. It should be according to profitable margins within the eCommerce space. A MAP agreement serves as a means to achieve the same. Some of the tangible reasons why MAP agreements are indispensable include the following –

MAP helps maintain brand identity and value
Small sellers can compete with large retailers and bigwigs
Underpricing is prevented
Seller margins and profits are protected
The self-perpetuating 'best price' loop is nipped in the bud
A MAP agreement helps promote fair competition among all distribution channels

Among the best success stories of MAP monitoring is that of Ray Ban – a parent company of Luxottica. A few years ago, Ray Bank introduced a MAP policy. It helped them confiscate 4.8 million counterfeit products. It also involves nearly 17000 unauthorized retailers.

The Ways to Identify MAP Offenders and Take Precautions against Them

40 percent of retailers never violate MAP, whereas 20 percent consistently violate it. This data was as per a Forbes article. Sometimes, the MAP breach is unintentional; other times, it is more deliberate. Suppose, one third-party seller violates the MAP agreement. A domino effect is produced. It is wherein other retailers also lower the prices. It is to undercut the competition and rope in more buyers. The most common MAP violations occur on reseller marketplaces. They are like eBay, Amazon, etc., and when the MAP agreement is about to expire. Thus, the key is for brands to remain vigilant and identify MAP violations. It is in its nascent stage. This will ensure their brand reputation and profit margins remain intact. Some of the methods to identify MAP offenders include

Manual Tracking, which takes about 30 to 45 seconds to check the price on a third-party site
Assign a dedicated team to uphold the MAP price policy
Adopt a process of ongoing vigilance. It should be through a press release and other forms of engagement. This will be with the third-party seller
Opt for automation

The Legality of MAP

Minimum advertised pricing is legal under US antitrust laws. Manufacturers and distributors must comply with the MAP or minimum advertised price. It is for particular items under a MAP policy. Thus, third-party institutions are expected to comply with MAP. It is by not selling a brand's products below a particular range.

The Ways How A MAP Monitoring Procedure Be Automated

We have established the importance of MAP. It is also essential to address the element in the room. It is about how to execute minimum advertised price monitoring. As hinted earlier, manually checking third-party platforms' prices is cumbersome.

It may take 40 to 50 hours of work. In addition, bigwig resellers like Amazon change over 2 million prices. Thus, keeping up with such capriciousness manually and regularly is a near-impossible feat. In such a context, AI-driven automated solutions come to the rescue. It can be firmly stated that MAP invigilation is possible. It is only through automating the process. How?

Mentioned below is a quick rundown of the ways. It is by which data extraction tools gather retailer prices from eCommerce sites –

Choose the target website for MAP monitoring.
Choose how to get prices in real-time or in batches.
Schedule data extraction for continuous MAP monitoring
Retrieve a specific proportion of retailer product price data. It is via specific keywords, product descriptions, or filters.
Choose a file format to receive the extracted price data, such as XML, JSON, etc.
Run the collector to receive product price data.

Conclusion