With the precarious state of today’s e-commerce landscape, your brand’s reputation is at risk… And so are your profits. As it currently stands, thousands of unchecked resellers are threatening the integrity of online products. By selling at below-listed prices, these resellers put a ceiling on a brand’s sales potential and dig into their margins.
The primary problem here is that retailers like Amazon that host such resellers are not doing enough to prevent infractions of Minimum Advertised Price (MAP) policies, i.e. a baseline selling price that brands set for all retailers to maintain. If even one reseller violates your MAP enforcement policy, the dynamic pricing algorithms snowball the effect resulting in a drop in sales across the board.
Furthermore, such activity harms the value of both individual products and the brand as a whole. A lack of MAP compliance discourages customers from staying loyal and paying full price; why would they if reduced costs can be found elsewhere? Plus, it’s worth noting that inconsistency in pricing generally acts as a black mark on your company’s legitimacy. Wildly varied price tags do nothing but make consumers assign a lower value to the product than advertised. Deep discounting also fuels the sale of counterfeit products, often right next to legitimate ones on the same website.
There’s a serious need for brands to enforce a MAP policy to monitor resellers. This isn’t a fleeting matter affecting a handful of brands but a pressing issue for online retailers on a global scale. Even marketplace giants Amazon and Alibaba have acknowledged the headache posed by counterfeit products. Both companies have taken initiatives to help their third-party sellers better fight this growing problem, but fake goods still remain shockingly prevalent.
The channels where heavily discounted products are sold without the manufacturer’s control is known as the Grey Market. Unlike the more infamous, behind-closed-doors Black Market, the Grey Market is usually technically legal, though it closely toes the line of lawfulness and is viewed quite unfavorably. Oftentimes, agents of the Grey Market are circumventing long-established rules and agreed-upon codes of conduct. Their deceitful behavior puts both the brand and customer at risk while reaping a fair bit of cash for the reseller.
In fact, the Grey Market has quickly grown to be a multibillion-dollar trade! Its rise has compounded the woes of luxury brands trying to combat sales slumps, currency fluctuations, and hesitant buyers. Industries such as Electronics, Beauty/Wellness, Pharmaceuticals, and Liquor now find themselves struggling with additional hindrances related to price stability, post-sales services, and customer dissonance.
Hence, the importance of MAP enforcement; setting a consistent price with an effective brand compliance strategy can result in a number of applicable benefits. For one, it creates a level playing field for retailers of all sizes across all distribution chains. This means that local mom and pop shops won’t get easily priced out by national brands. Another advantage is brand integrity: If all every retailer sells your product at the price you want, you can clearly dictate the item’s perceived value. Additionally, an entrenched MAP policy serves to secure your margins by adding a safety net to your sales process.
Because MAP enforcement can be a difficult undertaking, many manufacturers have had no choice but to bend to the pressures of the grey market. And though sites like Amazon and Alibaba have started assisting in this battle, the weight of the burden still falls on you, the brand. Thankfully, there are numerous actionable strategies to help you get a grasp on your secondary sales.
Many companies have taken actually taken the extra step in this endeavor by creating their own Grey Market Tracking departments with the goal of brand protection. Their duties often involve identifying resellers and converting them to authorized dealers to amicably mitigate the damage caused and build up new reliable sales funnels. In this way, these teams contribute to MAP enforcement and sustained brand legitimacy.
As for the tangible actions such departments take in their MAP compliance missions, that’s where Intelligence Node resources come into play. You can utilize our insights to take proactive steps in the future towards securing your brand and boosting your products’ market value.
Our Brand Compliance Solution enforces Minimum Advertised Pricing from a number of distinct angles. For starters, MAP monitoring is made a great deal easier with our database which provides accurate market oversight. And on top of that, you can rest easy with the peace of mind that comes from our automated centralized system that ensures resellers adhere to proper pricing. If a MAP violation occurs, the system will send the offending retailer a custom report proving their infraction and preparing you for any necessary follow-up measures.
Furthermore, all of these benefits are delivered in real time. Intelligence Node’s product tracking is the fastest in the entire market, refreshing every 10 seconds. Unlike most crawls, which occur just once per day, our data’s refresh rate ensures that your products are monitored during business operating hours across the globe. Plus, relevant pricing data and alerts regarding violations are promptly delivered to you as they come up.
We also offer unparalleled search capability for finding similar items and analyzing their price trends. In fact, our efficiency has evolved from 10 searches per second with a 6-machine cluster to 300 per second – all on a single machine!
All of these functions are powered by a Deep Learning AI that detects counterfeit products with superior product matching via image analysis and attribute extraction. With these tools in hand, you can easily track unauthorized seller accounts and unenforced products, monitor online sellers in places like China, and bypass language and currency barriers. The capability to display full product assortments on 3P marketplaces, regardless if the UPCs are MAP-tracked or not, is an unbeatable advantage.
Considering the grave threats of MAP violation on the Grey Market, it’s not a stretch to say these tools can be the difference that elevates your e-commerce revenue. Due diligence: Protect your brand by ensuring widespread compliance of your MAP policy. And, in turn, maximize your revenue and market growth potential.
We’re here to help. Let’s schedule a demo to figure out exactly how our solutions can help your business thrive. We’ll be thrilled to hear from you!