The minimum advertised price is an agreement between the manufacturer/brand and the retailer/seller in which the retailer can’t advertise the product at a smaller price than agreed. Yes, the retailer can sell the product at any price they want to, even at a loss. However, they can’t advertise a lower price than the one agreed on by MAP.
Why is MAP important?
The minimum advertised price is extremely important for manufacturers and brands, especially for those that sell premium products. If the seller promotes their products at a really low price or advertises their products with high discounts it can erode the brand’s image. Customers will start to think that the products are not really premium or that they are fake.
