The new Amazon policy will make it easier to contact MAP violators, but it doesn't mean they'll comply.
There’s a significant issue brewing for manufacturers and wholesalers who are selling their products on Amazon through third-party resellers. Some brands carry minimum advertised price (MAP) policies to protect against fluctuations in the value and price of their products on the online marketplace.
MAP policies create consistent margins and maintain credibility in the eyes of the consumer. In the online marketplace, however, there are resellers who seek to undercut competition with little regard for how lowering prices below the MAP impacts a brand’s reputation. MAP policies may exist in these cases, but there’s been an increasingly difficult challenge in enforcing them with resellers whose identities are hidden.
As of September 1, 2020, Amazon updated their terms of service to include the publication of all business information of third-party sellers and store owners on their platform. This is a huge shift in policy that has two clear motives:
Since Amazon is the largest and most well-established online marketplace in the United States, there is ample opportunity for resellers to ignore their manufacturers’ MAP policies and continue reducing margins at will with little concern for reprisal. And prior to the policy change on September 1, there was no recourse available for brands to enforce their MAPs.
Now, Amazon U.S. has joined the ranks of Japan, Mexico, and parts of Europe in adopting manufacturer price protections by publishing the identities of resellers on the platform.
On the consumer side, nothing will really change other than having access to business information for the reseller. This change is really a nod to brands and manufacturers who have been pushing for reseller pricing accountability for years, even decades.
Amazon’s commitment to publishing the identities of its third-party sellers will help to prevent counterfeit products in the market and encourages good-faith relationships between brands and resellers. MAP policy enforcement is a big part of that relationship, and brands now have an avenue to pursue MAP violators. This may lead to greater accountability and a more regulated online marketplace moving forward.
Before the seller identity rule came into effect, Amazon’s resellers didn’t have any business information listed on the platform other than their store name. Owner names and contact info were essentially hidden from the public.
In terms of enforcing MAP policies, this proved to be a challenge. If Acme brand used a MAP policy tool and discovered that their products were listed in XYZ Store on Amazon for well below Acme’s MAP, their first course of action would be to reach out with a cease and desist order. However, prior to September 1, neither XYZ Store’s legal business name nor its registered addresses were published by Amazon. Without those, Acme would have no way to begin the MAP enforcement process.
Now that Amazon’s policy has changed, reseller business information can be found on their storefront page. Just click on a seller's name, and this will take you to their storefront page where the information is displayed.
While the reseller still has control over what information they list there, it’s a strong first step in creating a MAP enforceable marketplace. With greater transparency in the marketplace, resellers are accountable to manufacturers to keep prices fair.
For consumers, there’s now a direct line of communication with resellers which can help resolve conflict between buyer and seller, as well as contributing to increased trust and brand loyalty.
Changes to Amazon’s storefront identification policy has dramatically shifted the relationship between manufacturer and reseller and between customer and marketplace. Manufacturers now have direct ways to enforce their MAP policies with resellers while consumers receive greater peace of mind with their purchases.
While this new policy does allow brands to more easily contact MAP violators, it doesn't enforce your MAP pricing automatically. If you’re reading this post and are interested in a definitive solution to MAP enforcement, consider touring our MapAuthority platform. Other MAP enforcement tools send brands a notification informing them about MAP violations, but we take a different approach. Our patent-pending tool never allows your reseller’s pricing to go below MAP in the first place. You can try our patent-pending tool free for 14-days here.
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