Serial entrepreneur with an industrial psychology education and over 23 years of creating, consulting, and operating businesses. Loves mountain biking, snowboarding, and surfing.
For manufacturers, there are many benefits to having an authorized dealer program. It allows them to have a lot of control over who sells their products. The benefits of this are numerous. One huge advantage is an improvement in the consumer’s buying experience. This has been shown over and over to have a huge effect on perceived brand value.
Of course, from our standpoint, it is extremely helpful in helping enforce MAP policies as well. It is one of the ways to give a minimum advertised price policy some teeth. We know from a ton of experience that it is much easier to remove a seller when you tell them they are not authorized as opposed to just saying they are violating your MAP policy. There is significantly less pushback that way.
But there is another thing we see neglected way too often. And that is to create a “material difference” in your products. This can be done very easily in the authorized dealer paperwork.
Let’s pause to define what a “Material Difference” is. The definition of a material difference is generally accepted to be:
Any difference between an authorized and an unauthorized product that a consumer would consider relevant when purchasing the product.
The word “any” here is very important. Because of course, it is important if a product is made with inferior materials, or if it has a physical fault. But the EXACT same physical product, that does not come with a manufacturer warranty would certainly be something that a consumer would find relevant.
It is so easy to say in an authorized dealer program that the manufacturer warranty only applies to products purchased from an authorized dealer.
The advantages of this are huge.
The teeth of your MAP policy are suddenly much bigger and sharper. Now you can tell a platform, like Amazon, that a habitual MAP violator is selling a materially different product and should be removed! This is something they will take seriously. Amazon’s focus is on the customer experience and if someone buys a product with no warranty, they are not going to be very happy if they have a problem with it!
And this is not just a “trick” to enforce MAP. There are some very genuine reasons why you might not want to offer a warranty to unauthorized dealers. Depending on your product some of the reasons might be that authorized dealers are aware of any recalls or have been trained in the proper storage of products.
In the end, if someone sells a materially different, or non-genuine, product, they have probably committed trademark infringement!
Now that is the kind of teeth you want.
If you have any further questions please reach out to us.
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