Minimum Advertised Pricing (“MAP”) is one of several types of pricing controls that can be used by manufacturers of goods and products. If you are customer-facing, essentially MAP policies regulate what minimum price you may advertise and sell the product. MAP is distinct from other types of pricing policies like MSRP — manufacturer’s suggested retail pricing. MAP is a command (typically enforced by contract) while MSRP is a suggestion.

MAP is common. An example from the restaurant industry is Subway’s famous five-dollar footlong marketing campaign from a few years ago. Two breakfast sandwiches for $2 is another example.

If you are an online retailer, MAP policies tend to be good for business. It means that your competitors will be required by the manufacturer to advertise the same minimum pricing for the same product. This, in turn, means your potential customers will not be lured away by lower base pricing. MAP policies also indicate a manufacturer that is serious about brand and marketing controls. This means that the manufacturer is more likely to aggressively police its MAP policies against authorized e-sellers who are violating the MAP policies, against non-authorized e-sellers advertising below-MAP prices and against e-sellers of counterfeit products. Finally, retailers tend to obtain good wholesale prices and other incentives from manufacturers for following MAP policies. This helps with profit margins and helps e-retailers succeed.

In general, MAP policies are aimed at protecting brand reputation. Consumer behavior studies have shown that excessively inexpensive products tend to be seen as “cheap” and low-quality. This is even more true for expensive, high-tech, and luxury items. MAP policies help ensure that aggressive discounting and price-cutting will not diminish the brand’s reputation for quality. Moreover, by keeping prices at the highest end, MAP policies create a level of consumer loyalty and satisfaction. If a consumer spends a lot on a product, that creates a “sense of ownership” in the continued value of the brand. Creating this sort of consumer loyalty and maintaining brand reputation are two other ways in which MAP policies tend to be good for business.

Despite the foregoing, many retailers — and e-retailers in particular — use various retailing tools and techniques to give consumers a lower price than the MAP. Examples include at-checkout discounts, coupons, promo codes, multiple-unit purchase discounts, seasonal sales and more. Manufacturers are fully aware of these techniques and typically address these techniques in their MAP policy agreements. As such, in general, e-commerce retailers will encounter several types of MAP policies including:

• Strict — no discounting of any sort
• Blind-eye MAP — discounting is officially discouraged, but tolerated if not overtly advertised
• MAP with pre-approved exceptions — like for volume discounts
• MAP will exceptions to be approved — like for seasonal sales
• And more

Violating MAP policies can be very risky for e-retailers. Unhappy manufacturers can refuse to sell products to the e-retailer and, in some circumstances, can bring legal action. For more information or if you have other legal issues related to internet law, contact the trusted internet and e-commerce lawyers at Revision Legal at 231-714-0100.

The Antitrust Framework: Why MAP Policies Are Legally Permissible

For decades, resale price maintenance—a manufacturer dictating the price at which retailers resell its goods—was treated as per se illegal under the Sherman Antitrust Act. That changed with the Supreme Court’s landmark decision in Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (2007), which overruled the century-old Dr. Miles precedent. Under Leegin, resale price maintenance is now evaluated under the rule of reason, weighing procompetitive benefits against anticompetitive harms.

Minimum Advertised Pricing policies are generally even more defensible than full resale price maintenance because MAP policies restrict only how a price is advertised, not the actual transaction price. A retailer subject to a MAP policy can technically sell below MAP—it simply cannot advertise that lower price in public-facing communications.

Drafting a Legally Sound MAP Policy

A MAP policy must be carefully drafted to avoid antitrust liability. Key principles include:

• Unilateral adoption: The policy must be a unilateral manufacturer decision, not the product of horizontal agreements with retailers. United States v. Colgate & Co., 250 U.S. 300 (1919), established that a manufacturer may announce pricing policies and refuse to deal with non-complying retailers, so long as it acts unilaterally.
• No retailer input into policy levels: Soliciting retailer input—particularly from retailers seeking to disadvantage discount competitors—can transform a unilateral policy into a horizontal price-fixing conspiracy.
• Consistent enforcement: Selective enforcement targeting only low-price retailers while ignoring comparable violations suggests anticompetitive purpose.
• Clear scope definition: Specify exactly what communications are covered (websites, email blasts, paid advertising) and which are excluded (in-store pricing, verbal quotes).

Online Enforcement Challenges

The proliferation of online marketplaces has made MAP enforcement significantly more complex. Unauthorized resellers on Amazon, eBay, and similar platforms can undercut MAP pricing while hiding behind opaque seller accounts. Manufacturers have several enforcement tools available:

• Brand Registry programs that allow takedown of unauthorized listings
• Authorized reseller agreements with contractual MAP compliance and liquidated damages provisions
• Selective distribution programs limiting sales to approved channels, supported by Continental T.V., Inc. v. GTE Sylvania Inc., 433 U.S. 36 (1977)
• Cease-and-desist letters and litigation against persistent violators

State Law Considerations

While federal antitrust law under Leegin applies a rule of reason to MAP policies, several states—including California, Maryland, and New York—have not adopted the federal standard under their own antitrust statutes. Manufacturers with significant retail distribution in these states should review their MAP policies with antitrust counsel to ensure compliance with both federal and state law.

MAP vs. Resale Price Maintenance: The Practical Difference

It is important to understand the operational difference between a MAP policy and a minimum resale price maintenance agreement. MAP controls only advertising—a retailer who sells below MAP to a walk-in customer without advertising that price technically complies with the policy. Full resale price maintenance fixes the actual transaction price. MAP policies create more flexibility for retailers and carry less antitrust risk. However, a MAP policy that is so aggressively enforced that retailers effectively cannot sell below MAP may be treated as de facto resale price maintenance by antitrust regulators.

Contact the internet and e-commerce lawyers at Revision Legal at 231-714-0100 to draft or review a MAP policy.