In today’s business world, it's simply impossible to stay competitive without a strong online presence. While it’s great to have products sold on reputable e-commerce sites, you also need to ensure they are playing by your rules. Most importantly, online sellers should advertise product pricing according to your standards.
When compared to the rest of the market, luxury brands have an unparalleled interest in brand equity. As such, luxury brands must carefully regulate how their products are represented on the open market. If a luxury product is priced too low, it has the potential to destroy brand equity overnight.
By understanding how luxury brands protect themselves with MAP strategies, you will gain a clearer picture of how to insulate your own brand online.
What Are MAP Pricing Policies?
In the field of e-commerce, MAP is an acronym that stands for “Minimum Advertised Price.” In turn, MAP policies are utilized by brands to ensure that sellers properly represent their products online. To illustrate, a pet product company would send a MAP policy to all their distributors and retail sellers which lays out the minimum advertised prices for their products. If a retailer goes below the agreed upon amount, the pet company’s ultimate recourse is to suspend their account.
One of the key things to remember about MAP policies is that they regulate advertised pricing with retail partners - both online and brick and mortar. Nonetheless, sellers are still free to sell the item for whatever price they see fit.
MAP policies are important because they create a uniform value for a brand online. As such, a MAP policy is a major protector of brand equity in the field of e-commerce.
What Makes Luxury Brands Different?
Luxury brands occupy a unique niche in the market.
The brand equity of luxury brands is tied to the feelings of authenticity and exclusiveness that they advance. In turn, people are willing to pay substantially more for luxury products to experience such exclusivity.
Aside from higher prices, luxury brands differentiate themselves with such things as quality, craftsmanship, and history. For example, clothing manufacturer Ralph Lauren is one of the most long-standing luxury brands in the U.S. With high-quality clothing and exceptional marketing, Ralph Lauren can charge several times more than competitors for similar types of clothing. As Branding Mag puts it, Ralph Lauren's brand value is intimately “linked to the excellence, traditional expertise, and inner qualities” of the company’s clothing line.
In the end, brand equity is one of the largest assets for any successful luxury brand. Yet, this brand equity can be fragile if treated incorrectly.
Luxury Brand MAP Policies
Because brand equity is intimately bound to pricing for luxury brands, they must be very careful with MAP strategies. To illustrate, a major mistake of luxury brands is to slash prices in order to drive quick revenue and stimulate growth. However, dropping prices below a certain threshold has the potential to alter how people perceive a brand, which reduces the brand’s true value.
There is a very important lesson to heed from luxury brand map policy: how products are priced has a direct influence on brand equity.
If you aren’t able to control pricing with effective MAP strategies, you run the risk of alienating good customers who are willing to pay full price in exchange for one-time buyers looking for a deal. Even worse, online sellers are the ones making a quick buck, while your brand equity slowly declines.
MAPP Trap Will Protect Your Brand Equity
A luxury brand’s MAP policy does more than regulate how products are advertised online - it also protects the MSRP of your goods. When e-commerce sites advertise your products at big discounts,it misleads customers into thinking your products aren’t worth their MSRP.
As the value of your products declines in the eyes of consumers, so does your brand equity.
Automated price monitoring from MAPP Trap allows you to monitor every place where your products are sold online. In the event that a retailer breaks your MAP policy, we will help you rectify the issue with enforcement features.
By giving you the tools to catch and fix MAP violations, we also give you the means to protect your brand equity.
With MAPP Trap, you can maximize your online exposure, while also ensuring that your brand is represented according to your standards.