Perhaps you’ve already developed and published various reseller policies to guide your resale channel’s behavior — an authorized dealer program, a minimum advertised price (MAP) policy, a unilateral pricing policy (UPP), a direct authorized Internet reseller agreement, etc.
Or perhaps after reading that sentence above, you’re now thinking, We’ve published a MAP program, but none of these other policies. Do we need them?
The types of reseller policies and agreements your company should implement will depend on your specific circumstances, including what you expect from your resale channel. (If you’d like help figuring out the right seller policies for your company, contact us.) The point of this post is simply to suggest that any policies and guidelines you set for your resellers need to be supported by an intelligent price monitoring strategy.
After all, even the most carefully drafted MAP policy, unilateral price policy or authorized dealer program will not have the positive effect your company had in mind when creating the program — protecting the interests of your honorable retailers, maintaining your public perception as a quality brand — unless the policy is properly monitored and enforced.
With that in mind, here are a few questions to ask yourself about your price monitoring strategy for any of the standard types of reseller policies you’ve implement or are thinking about implementing. (The ideal answer to each question is yes.)
Is your price monitoring system set up to apply your relevant reseller policy to each violation?
If you’ve implemented an authorized dealer program, for example, your guidelines for resellers in that program might be broader than simply advertising your products above a certain minimum price, as your MAP policy demands. This means your enforcement strategy will encompass more than merely price monitoring.
You might, for example, demand that authorized dealers offer a specific minimum number of customer support hours set by your program, and that their website featuring your products must meet certain quality standards.
At the same time, however, you might not be able to demand these specific types of compliance from resellers who are not in your authorized dealer program — but you may still demand that those companies adhere to your MAP policy.
In other words, your enforcement strategy will need to include the ability to distinguish among various types of resellers, and to enforce your pricing and other policies accordingly.
Does your price monitoring system include a plan to take appropriate action against specific violations?
Let’s stick with the above example, where some of the resellers you’ll be monitoring are part of your authorized dealer program, and others are not but still need to comply with your MAP policy.
Your price monitoring strategy obviously needs to go beyond monitoring, to actual enforcement. So your price monitoring process will need to be able to apply the specific consequences against authorized dealers that you’ve set in your authorized dealer program, and the potentially different consequences you’ve set in your MAP policy.
Perhaps you’ve included language in your authorized dealer program stating that you’ll add repeat violators to a Do Not Sell list and cut them off from future inventory. For this to work, you will need to document and keep track of violations specific to those authorized dealers (as opposed to resellers not in that program), so you’ll know when a dealer has reached the minimum number of violations that requires them to be put onto your Do Not Sell list.
Yes, this will make your price monitoring infrastructure more complicated. Which is why the ideal solution will be an automated price monitoring platform instead of more manpower or time devoted to in-house monitoring.
Will your price monitoring system contact both the violating reseller with a direct email address and through a marketplace like amazon where the violation occurs?
Another wrinkle for your price monitoring strategy is the fact that violations often occur not on the websites owned by your retailers, but rather on the major marketplaces like Amazon and eBay.
When this happens, the manufacturer is often unsure how to stop the violation, because those marketplaces do not go out of their way to intervene in a pricing dispute (or other type of dispute, for that matter) between a brand and its reseller.
But for your price monitoring program to be truly effective, you need a system that can take action on your behalf even when the violation occurs on one of these major platforms.
This is yet another reason that whatever price monitoring solution you implement should be automated — because dealing with the back-and-forth of these pricing disputes on the large retail marketplaces can take far more time and resources than you’ll find it feasible to expend.
CONCLUSION: Your price monitoring system should be automated
What all of this suggests, then, is that you should deploy an intelligent, automated platform for price monitoring, MAP enforcement and Internet brand protection. It’s the only feasible and cost-effective way to conduct reliable price monitoring, as well as monitoring and enforcement of your various other reseller policies and agreements.
To discover how an automated price monitoring and enforcement platform can work for you, schedule your free demo.