MAP Pricing: What Amazon Sellers Need to Know
Amazon sellers need to know the definition of MAP pricing is and what it means for online business. MAP stands for minimum advertised pricing. Minimum advertised pricing refers to when a manufacturer tells its distributors and retailers that they cannot advertise the products in their inventory for less than what the manufacturer dictates. On Amazon, this means that you cannot list the price you want to offer Amazon’s customers. This type of restriction is also referred to as “vertical agreements.”
To me and many entrepreneurs, this makes no sense. You bought the product, why should anyone be able to tell you what you can sell it for?
What if your listing is not moving? What if you cannot sell the product for the MAP? Should someone that already has your money compel you to keep it in inventory indefinitely? Should Amazon want products taking up space in their FBA warehouses longer? Why should anyone have the ability to tell you that you MUST lose your money because you cannot list your property for whatever you want?
What is more offensive than being told that you must lose money on your property is the fact that MAP prices are only be imposed on off-site advertising like Amazon, Newegg, eBay, etc. Brick and mortar stores can let everyone that walks into their store that the product is being sold for less than MAP. Brick and mortar stores don’t suffer the same restrictions that we suffer.
Manufacturers have been told by the one of the largest group of corporate lawyers that MAP pricing should force Amazon and other internet sellers to impose extra clicks on our customers. Online sellers can impose extra steps for their customers like “call for pricing” or “add to cart to see price.” But, we know that more clicks mean fewer sales.
Manufacturers have also been advised that they should try and impose their price restrictions broadly.
Corporate America was told by their lawyers, the American Bar Association, that: “internet and other discounters….” are “free riding.”
I don’t know about you, but my clients, including some of you and your colleagues, are not free riders. You are the frontiersmen of the American Dream. Amazon sellers are keeping our economy alive when corporate America continues to provide consumers with awful experiences and high prices. You strive to give customers with low prices and better service.
The National Association of Wholesalers admitted to its members in 2008 that MAP pricing will no longer always be legal. Also, that wholesaler should not band together and seek high MAPS because that could violate the law.
Here is the current reality: We can win the fight the against MAP pricing.
We have the United States Supreme Court on our side. We have Amazon’s Leadership Principals in our favour.
If you would like to learn more about what the Supreme Court of the United States (“SCOTUS”) has to say about MAP pricing and why Amazon should never again harass a seller for MAP claims, read the court’s 2007 opinion in the Leegin case and Amazon’s MAP policies.
