According to Jeff Bezos, the driving ethos behind the ecommerce behemoth’s success is being 100% consumer-centric. Consumers drive corporate decisions about technology, product selection, price and more. And low prices make consumers happy. That fact is one of the main reasons enforcing a minimum advertised price policy (aka “MAPP”) on Amazon is so difficult. The truth is that Amazon won’t do anything to help brands maintain higher pricing on its platform. If that’s what they want then they have to figure it out by themselves. The good news is that there are some tried and true strategies to help. But before we dive into those some preliminary work needs to be done.
Brand Protection on Amazon
To be successful, companies must first take some Amazon-specific protection measures. These tasks should be done to protect the brand’s intellectual property rights and ensure that products are listed in a consistent manner.
Brand Registry - Amazon provides a free service for brands to register their trademarks (both registered and applied for). Once verified, Amazon can be contacted for help in removing infringing sellers.
ASIN Discovery and Merging - In an effort to decrease competition for the buy-box, some merchants create duplicate item listings in order to get their own ASIN. Not only do multiple ASINs confuse consumers, they make tracking sellers extremely difficult. In keeping with its consumer-centric mantra, Amazon will help to remove these listings.
Transparency Program - This is a product serialization service that helps identify individual units and proactively prevent counterfeits from reaching customers.
Enforcing MAP Policy on Amazon
To be successful in protecting a brand against violators on Amazon, it is essential to organize all sellers into buckets by assigning specific seller designations. As you’ll see, each designation warrants their own tactics.
With Amazon authorized suppliers, the brand knows how they get inventory and are okay with them selling their products. In exchange for complying with the brand’s MAP Policy, Authorized Sellers receive certain material differences (e.g., discounts, payment terms, advertising allowances, product warranties, etc.)
Depending on the brand’s online distribution strategy, they may have one exclusive seller, a small group of sellers or allow as many of their accounts to sell on Amazon as possible. However, they must comply with the brand’s MAP policy to remain Authorized. If they fall out of compliance, these privileges are revoked.
Enforcing MAP Pricing For Authorized Amazon Sellers
Taking action on MAP policy violations for authorized sellers is fairly straight-forward. After the brand has announced its policy launch, it should begin enforcing in a manner consistent with the policy’s guidelines (i.e., three-strikes means three notices). Emails should be sent directly to the sellers’ domain-based email address. It’s not a good idea to send enforcement notices through Amazon’s seller contact platform because that’s against Amazon’s terms.
If the seller is still violating MAPP after the brand has issued the proper number of warnings, then they need to stop shipping to that seller. If they get inventory directly then it’s easy. But if they get it from wholesale distributors, the brand must send a do-no-ship list to those companies with their assurance of cooperation. If any wholesaler distributors refuse to comply, the brand must be willing to stop working with them.
Once an Amazon seller has been suspended, it should be added to the next bucket: Unauthorized Known.
Unauthorized “Known” Sellers
Again, an Amazon unauthorized party gets inventory from sources known to the brand. Some of them may be unauthorized to sell on Amazon because of a brand’s online marketplace strategy. The rest, however, are unauthorized because they’ve been non-compliant with the brand’s MAP Policy.
Enforcing MAP Pricing For Unauthorized “Known” Sellers
Enforcement of MAPP with any Unauthorized Seller (known or unknown) should not be a consideration. The fact that they are selling on Amazon is the offense so price is irrelevant. These sellers must be contacted based on product listings.
Sometimes Amazon sellers that have been recently unauthorized because of MAPP non-compliance will still have inventory. Brands should either be patient and allow them to liquidate, or, in some instances, buy the inventory back.
If the seller continues to list the brand’s products on Amazon, then the brand needs to employ some additional tactics. Although they won’t get rid of all sellers, the brand should send cease and desist notices. They should also send IP Rights violation complaints directly to Amazon (one of the reasons for registering with Brand Central). Where the brand goes from here should be based on the relationship. Here are some suggestions:
If the seller is still getting inventory but it’s not directly from the brand, then all other avenues of access must be identified and blocked. This may include foreign distributors.
If the account is still authorized on other platforms and/or brick and mortar stores they should be warned that the other channels will become unauthorized as well.
If the brand has a true Authorized Seller Policy then legal tactics such as tortious interference should be employed. Note that sending cease and desist notices is important to the foundation of legal strategies.
Unauthorized “Unknown” Sellers (aka Rogue, Ghost or Diverter Sellers)
These are sellers that are somehow getting the brand’s products without the brand knowing how. Therefore, they tend to be the most difficult sellers to remove.
These Amazon sellers that frequently change their store names, post false information about themselves, create product listings using alternate ASINs, list counterfeit items and employ opaque business practices. No matter how much contact information exists, the brand and their partners don’t know how they get inventory (or at least that’s what they say).
The most important thing for a brand to do is identify the source of inventory. Here is a list of some enhanced techniques to help with this:
Strategic buys – although this won’t work with FBA sellers, sometimes it helps with FBMs to know where the product was shipped from. Once that’s determined the brand can cross-reference it with their account list and request the same from their independent sales reps and wholesale distributors.
Drop shipper identification – this is a practice that is growing. Independent companies are working with brands to be their consumer fulfilment source. Generally, the drop shippers only work with larger retailers, but if the brand has not prohibited it, many of them provide data feeds to 3P sellers.
Forensic accounting – this internal process involves forwarding the product mix (with quantities) to the brand’s accounting department. Seller product selections should be compared to invoices.
Enforcing MAP Pricing for Rogue Unauthorized Sellers
Brands should still send cease and desist notices to these companies. They should also send complaints to Amazon regarding unauthorized use of IP. Another strategy that we’ve had some success with is asking if the company would like to become an Authorized Seller. Offer the sellers discounts, etc. This can sometimes result in the seller revealing themselves to you.
What Else Can Be Done About Unauthorized Sellers?
Many brands will also list the Unauthorized Sellers on their own websites. A message such as “These sellers are not known by us, or authorized to sell our products. Therefore, we cannot guarantee the products they are selling are authentic and cannot honor warranties.” Brand-loyal consumers who see that will not buy from those sellers.
Very few brands have the internal staff, expertise and technology to execute the strategies outlined above. MAPP Trap
, however, can and does perform all of these services for its brand partners. Our Amazon Brand Compliance services have helped clients reduce the number of Amazon sellers and violators by as much as 75% in a relatively short period of time. In this day and age, using a company such as MAPP Trap to monitor, identify, and enforce policies is a standard business practice.
For more information contact firstname.lastname@example.org