Protecting Your Brand Against Amazon
Selling your products on Amazon can win a lot of exposure for your brand, but for many companies the associated costs just aren't worth it. Their marketplace system forces retailers to compete primarily on price, exerting downward pressure on prices. Your MAP policy is only of limited use here, as Amazon consistently refuses to enforce them, allowing retailers to undermine your pricing structure and turn your company into a discount brand.
Leaving AmazonThe nuclear option, and one that several companies have already taken, is to stay off Amazon entirely. If your products aren't available there, it can't damage your brand. In order to achieve this, insert a new term into your retailer agreements that prevents them from selling your products on Amazon. In fact, you could require them to sell only through their own websites and brick-and-mortar stores, as other online marketplaces like eBay can be equally dangerous for your brand.
However, this strategy is not without risk. Amazon makes it very easy for sellers to trade anonymously, meaning that unscrupulous retail partners can continue to trade there under a false name. Amazon is notoriously unhelpful when manufacturers attempt to enforce their MAP pricing on its platform, meaning that retailers can quite easily circumvent your policies unless you take specific steps to prevent them from doing so.
Investigating AmazonWhether you choose to allow your retailers to sell on Amazon or not, monitoring your products on the platform is absolutely essential. Amazon won't enforce your pricing and other policies for you, so if you want to prevent them from becoming useless, you will need to do some sleuthing for yourself. While retailers trading under their own names are easy to keep tabs on, Amazon makes it easy for them to trade anonymously, forcing manufacturers to make an extra effort.
Often, sellers on Amazon will sell under a fake name, but ship the products themselves. This makes it quite easy to get contact information. Simply place an order with them, then look for a shipping address on the packaging. If you can't find one, ask to make a return. You could also just ask for their contact information, and some will oblige. Once you have a telephone number or a shipping address, you can use this information to find out how your goods ended up on Amazon.
However, not all Amazon sellers will make life so easy for you. They can sell products themselves but have Amazon ship them, or even have Amazon take care of both selling and shipping. With no return address but Amazon's warehouse, it becomes that much more difficult to identify leaks in your supply chain. This makes product serialization a very useful option for manufacturers. If every product that you make has a unique serial number, you can keep a record of which retailer each one goes to. If you purchase one of these products from an Amazon seller, you can use the serial to find out where they got it.
This approach requires all of your retailers to be on board, as it imposes costs on them for computer tracking, and can also increase the per-unit cost to manufacture each product. However, if your brand sells well, it can be a small price to pay to protect your brand image.
Fighting AmazonAmazon will not enforce your MAP policy for you, claiming that it is an agreement between seller and manufacturer that they are not party to. However, the online marketplace isn't entirely lawless. If you can prove that sellers are violating your copyrights or trademarks, you can have them removed much more easily. For example, if a reseller is using product photography produced by your company, that is an illegal use of your copyrighted material. You can also go after sellers for selling counterfeit products, if you arrange your product to make this possible. By including a warranty that is only valid when the product is purchased from an authorized seller, you can go after any unauthorized Amazon seller who describes the product that they are selling as new, as it lacks the warranty and therefore differs from a new product. The threat of legal action can be enough to force Amazon to talk to you about unauthorized resellers.
Now that you are armed with a few strategies for taking on Amazon sellers and the company itself, you can better protect your pricing structure and with it your brand's all-important reputation. Using them effectively requires constant vigilance, though: it is extremely easy to set up an Amazon store, tilting the playing field firmly in favor of sellers and against manufacturers.back to blog