Online retailers in the U.S. should start considering a better minimum advertising pricing (MAP) strategy when placing products on Amazon, especially since the e-commerce giant has accounted for 49.1% of all sales in the country.
As PriceManager and other industry experts explain, an effective MAP pricing policy should be able to prepare you once Amazon’s share reaches half of the market. It should also help in tracking competitive intelligence, so you’ll know how other businesses are pricing their items. This will especially be beneficial ahead of this year’s holiday season.
Not Even Close
While Amazon takes a huge chunk of $252.7 billion in total e-commerce sales, its competitors are far behind with single-digit market shares. For instance, eBay ranks behind the Jeff Bezos-led company with a 6.6% market share.
Apple and Walmart are even farther behind with a 3.9% and 3.7% share, respectively. The rankings came from Visual Capitalist’s analysis of the top 10 public companies’ market share for this year. As most products are now selling on Amazon, it makes sense for brands to track how resellers are pricing their products on the company’s website.
Whether you like it or not, a competitive MAP pricing policy for Amazon will only be more relevant as the company’s market value continues to increase. In just 16 days, the online retailer increased its value to $700 billion from $600 billion.
It also became the second company after Apple to reach a $1 trillion value. The smartphone maker achieved the feat in August, while Amazon recently did the same in early September. As more people patronize online shopping, e-commerce firms should expect that Amazon’s market influence will not disappear anytime soon.
When choosing among different MAP pricing policies, it’s best to choose one that can offer a host of services, such as 24/7 price tracking, marketplace search systems, and product analysis of your competitors.