Admin
|
2.12.2024
If you own or manage the finance side of an E-commerce business, you must be well aware of how your customers always tend to go for the best-priced or often lowest-priced offering when making a purchase.
And this isn’t some small percentage. A survey showed that 94% of your business’s potential customers compare the online prices of a product or service you are selling with your competitor’s pricing before they make a purchase. Plus, 60% of them expect to see consistent pricing across different retailers. This means if one of the retailers prices your products too low, you’d simply lose market share or harm your profit margin to compete at similar price points.
MAP monitoring or Minimum Advertised Price monitoring can help you remain profitable and protect your business from price erosion. Read along to develop a clear understanding of what MAP monitoring is and how it can benefit your business.
MAP monitoring, short for Minimum Advertised Price Monitoring, is a process in which you’ll track how the sellers selling your products or services are pricing your products and whether it aligns with your MAP policies or not.
This will help you figure out the lowest prices any reseller or online retailer is charging for your offerings and take corrective action, if need be, to maintain the perceived value of your brand and ensure that all retailers follow a consistent pricing strategy. This won’t just protect your brand’s integrity but also help you compete with other businesses without sacrificing your profit margins in the market.
Here’s why you need to constantly monitor Minimum Advertised Price for your business:
Your products and their value can boost or reduce your sales volume, but what can keep you in business for long is how well your company stands out in terms of your brand integrity. When you keep the retailers in check in terms of how low they price your products, you can protect your brand’s integrity.
This is important for convincing customers to buy even your high-priced products because they’d know you deliver good value for money, and the idea that ‘it’s cheap, so it might not be worth it’ gets out of the picture. One study showed that enforcing MAP policies and making sure that retailers comply with them can increase the perceived value of your offerings among consumers by 20%. The result? You’ll get repeat customers and better loyalty.
Want to stay competitive in a business space where one viral TikTok can send the sales of certain products skyrocketing while one bad pricing review can completely tarnish your brand reputation? Then, you definitely need to know the pricing trends in your niche. MAP monitoring helps you with that by keeping an eye on your competitor pricing and empowering you to make real-time price adjustments to maintain or expand your market share.
What you’ve rightfully designed and produced and thus priced at your desired quote, someone else might counterfeit and sell dirt cheap. This will take away your market share and dilute your brand’s value, and that’s why MAP monitoring is so important.
For example, it will help you see promptly if some retailer is pricing a product you have standardized to be sold at a minimum of 60 USD for just 20 USD and immediately recognize that it’s a cheap copy and file a lawsuit against the seller for counterfeiting. This will save you millions of dollars in lost sales. Can you believe in the US alone, businesses lose 29 to 41 billion dollars each year because of counterfeit products? MAP monitoring will help you avoid this fate.
It’s no good for your brand if your products sell like hotcakes one season due to aggressive price cuts and gather dust the other. For sustainable revenue growth and to maintain your sales volume, you need to have effective MAP monitoring practices in your company. This will help you avoid price erosion by blocking any non-permitted discounts that could undervalue your offerings.
Before you get down to developing your pricing strategy, first understand how MAP (Minimum Advertised Price) pricing and MSRP (Manufacturer’s Suggested Retail Price) pricing work and how the two are different.
If you are a manufacturer, new to the space, MSRP is simply a guideline that you’ll set suggesting a price, after considering all costs, at which your retailers can sell your offerings. It will serve as a benchmark for them and help them use the flexibility in pricing to their advantage while your consumers will be able to analyze your product’s value accurately.
On the other hand, MAP or the MAP policy you establish will be a legally binding minimum price point beyond which you won’t allow your sellers to advertise your products. This is especially a need if you don’t want to devalue your brand or your products and also ensure that your sellers can maintain certain profit margins. Knowing both of these will help you make informed pricing decisions and policies to stay competitive and protect your brand integrity.
Now that you know why MAP monitoring is so important, wondering how it can benefit your business? Here are some of its advantages:
By enforcing MAP policies, you can develop trust with the retailers you partner up with and make sure none misses out on market share with consistent and fair pricing across different stores. By leveling the playing field for them, you can strengthen the trust retailers put in your brand and encourage them to invest more in promoting your business offerings.
Your consumers need to see your brand as a reliable entity. You can ensure that by checking if your products are being advertised at similar price points across different stores. For example, if one of your retailers is selling your product at 30 dollars and another is selling it at 12 dollars, it’ll confuse your consumers and cause distrust in your brand. MAP monitoring can help you avoid that and improve your consumers’ shopping experience.
By effectively monitoring MAP, you can protect your business from negative consequences like price erosion that can come up because of unauthorized discounts and aggressive price cutting from your retailers when they’re trying to clear the stock or selling more. Plus, your MAP policies will give you control over how your products are marketed, advertised, and sold across different eCommerce stores or platforms so that your brand can retain its perceived value.
Here’s how you can do MAP monitoring for your eCommerce business and protect your consumer trust and brand image:
Start by investing in a robust MAP monitoring software like WebDataGuru. Choose a tool that automates the tracking of advertised prices across various e-commerce platforms. This price-tracking software should provide real-time alerts for any violations, allowing you to act swiftly. Look for features like customizable notifications and comprehensive reporting to keep you informed about pricing trends and compliance status. By automating this process, you free up valuable time and ensure consistent monitoring without the manual effort.
Next, develop clear and concise MAP policies. Outline what constitutes a violation and the consequences for non-compliance. Communicate all these policies clearly to all your retail partners and work with legal experts for MAP Policy Enforcement. This will help them understand how dear you hold your brand’s integrity and how any form of non-compliance can cause them financial and legal losses.
If you want to compete well in your specific niche, review your retail pricing strategy regularly. Use AI tools like WebDataGuru to track how your competitors are pricing their products, what some trends are in the market, and how your consumers are behaving. All of this will help you be clear and appropriate with your MSRP and MAP pricing policies and protect your brand's value and profitability for retailers. Just schedule these reviews every four or six months to consistently evaluate and rethink your pricing standards.
Consistently analyze your MAP compliance data to identify patterns or recurring violations among retailers. Use this data to refine your enforcement strategies and address persistent issues with specific partners. Look for trends that may indicate broader market shifts or retailer behaviors that need addressing. By staying informed, you can make strategic adjustments that enhance compliance across your network. You can also use MAP compliance software for that.
Foster open communication with your retail partners regarding MAP policies. Discuss the importance of these guidelines in maintaining fair competition and brand integrity. Building strong relationships encourages retailers to comply with your policies willingly, as they see the mutual benefits of adhering to established pricing standards. Regular check-ins or meetings can help reinforce this collaborative spirit.
Future trends in the MAP monitoring space will have to do with more use of AI, smart data analytics, and pricing, as well as the integration of these MAP monitoring tools with eCommerce platforms. The use of AI and machine learning algorithms will further help companies like you position yourself better in the market.
Besides, the focus will be on consumer behavior as well, as they are the ones that drive sales after you’re done establishing and implementing policies. Their behavior will be an important factor in helping businesses like yours create effective MAP policies and stay competitive.
Just stay informed about these trends and embrace them with promising tools that are already using these technologies.
When it comes to advanced MAP monitoring, WebDataGuru offers powerful features that can significantly enhance your pricing strategies. It’s a promising platform with features like data extraction, web scraping, price intelligence, and more, all of which can help you establish well-informed MAP policies and track what all your retailers are up to.
In short, MAP monitoring is vital for your business’s success in the e-commerce space. Think about better retail partnerships and improved brand value and image! So, if you want advanced solutions tailored to your business’s needs, explore WebDataGuru’s robust features for comprehensive MAP monitoring.
Book a demo now and start optimizing your pricing strategy today!
Tagged:
