Online retail is constantly changing at the speed of light. New technologies and techniques are implemented non-stop to boost the industry and increase customer satisfaction. Every online store nowadays needs to be able to adapt quickly and make changes if necessary.
However, there are multiple things retailers are concerned about. One of them is the price of their products and how it affects the perception of their brand. In the following text, we will introduce you to Minimum Advertised Pricing and provide you with numerous reasons why you should use the MAP software.
What is Minimum Advertised Pricing?
We will try to explain this policy as simple as possible. In a nutshell, this is an agreement between a brand or manufacturer and distributors regarding the lowest possible price of a certain product. Once this agreement is made, sellers cannot offer merchandise at a lower price than the one that was originally arranged.
No, this agreement is not legally binding, meaning that sellers can break it, but at the same time, they can expect to be penalized by the brand. These terms are stated in the original agreement and can be in the form of withholding orders and terminating collaboration.
Why should you care about it?
The answer to this question is fairly simple. Nowadays, there are third-party vendors that can offer your products at a significantly lower price. What’s more, since they aren’t part of the official distribution channels, they can charge whatever they want. This cannot only have a negative impact on your profit but most importantly, it can ruin your brand image over time.
By keeping your eye on this, you will not protect only your company but also your distributors since they won’t have to worry whether someone else will offer the merchandise at a significantly lower cost. Let’s be honest. People nowadays use the internet to look for discounts, and generally speaking, they will also buy an item from a vendor how offers the lowest price. Well, this is when MAP software comes in, and you should explore it to know more about its features.
What are the benefits?
Now that we have introduced you to this policy and gave you essential reasons why you should care about it and implement it, let us tell you how you can benefit from it.
Discover unauthorized sellers
We have already explained that this is a big problem in online retail. It became even more significant in the past year simply because people didn’t have another choice but to go online and purchase the merchandise they need. Well, other people took full advantage of this by offering counterfeit products or the original ones at a significantly lower price.
Well, in order to solve this problem, retailers have to locate unauthorized sellers, and this is something that MAP software enables them to do. Simply put, it is able to identify similar products on the online market even if the name, images, and of course, the cost are different. The app enables you to locate your merchandise on the web and discover whether it is sold by your official distributor or a third-party one.
Protect your brand
Nowadays, your brand image is everything. Obviously, customers care about your products, but the truth is that they won’t even test them if they don’t have confidence in your company. As it is to be expected, this reputation is ruined every time a person gets a counterfeit product. Yes, people are advised to buy items from respectable vendors, but let’s face it. Resisting the temptation of saving money is never easy. However, when they discover that the item is of low-quality, they won’t say negative things about the seller but about your brand. Over time, this can destroy your reputation, and as a consequence, you will lose customers, distributors, and of course, a lot of money.
Control discounts
The price war is a common issue in online retail. What are we talking about? Well, when one vendor decides to offer a discount for a certain product, their direct competitors will likely do the same. This is the only way for them to ensure that potential customers will consider their store and eventually make a purchase.
However, consumers make a direct connection between low price and low quality. Basically, even though they can get a great deal, most of them will choose not to proceed with the shopping. Why? Well, they are suspicious about the quality and believe that they will be throwing money down the drain.
This software enables you to understand the current prices on the market for products similar to yours. This way, you will be able to determine the lowest cost at which your merchandise should be sold. Your distributors are obliged to follow your instructions (even though they are not legally obliged to do it). In a nutshell, by preventing these price wars, you are not only protecting your brand but also your vendors.
Boost your business
One of the greatest advantages of MAP policy is that it enables you to understand how effective each distribution channel is. Not all of them can be equally valuable for your business, and as already mentioned, some of them may break the original agreement.
By implementing this strategy, you will be able to see who the weak links are in your distribution channels, and you can either terminate your collaboration or, on the other note, find a way to increase their value. At the same time, you can award those who are following the guidelines of the policy.
Wrapping up
There is absolutely no doubt that online retail offers more advantages than running a traditional store. Numerous expenses do not exist in the world of online business, but still, that doesn’t mean that certain challenges do not exist. If you collaborate with both online and offline vendors, you have to make sure that both sides are happy. As you can assume, this is exactly what MAP policy will enable you to do. By implementing it, you will be able to determine the cost of your merchandise while at the same time protecting the reputation of your brand.
