"We can't adevrtise our low price, you have to e-mail us" - is this true? (1 Viewer)

[MickeS]

I clicked on the link to http://www.projectorinfo.com on the front page of HTF, to see what they charge for a Sony projector. Next to the projector price, it says to click for the price, and then a window pops up saying this:
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Some of our product manufacturer partners enforce a Minimum Advertised Pricing (MAP) policy. As an authorized dealer we cannot advertise a price lower than the manufacturer's chosen MAP price. Our manufacturer partners may terminate any dealer that does not comply with their MAP pricing policies.
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Is this really true, or is it just a way to get you hooked? I really find it hard to believe that they are not allowed to advertise whatever price they want, as long as they pay Sony the same price as everyone else. Or is this some scheme where they've bought from a third party?
/Mike

 

[Scott H]

That is true.

Sometimes when you put the item in your shopping cart the price will display in your shopping cart, thus not having to email the price. There are actually some items at Amazon for which they can't display the price, with the same explanation. And you can sometimes see the same explanation given in advertising circulars in Sunday papers, and it's long been that way with photographic equipment from the major NY and LA shops.

 

[MickeS]

Yeah, I've seen it a lot too, but that doesn't necessarily mean that it's true...

/Mike

 

[Don Black]

It's true in the sense that manufacturers could quite dealing with a retailer that doesn't honor MAPs. Also, a manufacturer generally ties market development funds and cooperative advertising dollars to enforcement of MAPs. These practices are regulated by the FTC and manufacturers are often sued by the government for unfair business practices since it is basically price fixing. About 2 years ago, the FTC won a case against the RIAA for these types of practices. They required the labels to remove the MAP requirement.

 

[Hugh M]

I believe there is a standard for this somewhere..and in some cases it makes sesne.

but it is USED to get somewhat of a commitment from you. abused would be a better word.

J&R is ridiculous for this..they seem to do this ALOT..perhaps SONY is one of the more strict manufacturers. But my guess is that being the most expensive models that J&R carries in alot of categories, they are successful in keeping interest by not showing the price when comparing to others.

 

[Jon_B]

I think Sony is one of the more strict manufacturers. For example the Sony VPL-VW10HT was offered by many places on the web below the msrp. Rumor has it that many of those websites that were guilty of this did not get a chance to sell the vpl-vw11ht.

Jon

 

[Don Black]

I think we're confusing MAPs with authorized vs. unauthorized dealers. Sony's whole pitch is that they want to carve out a slice of the online market for themselves and a select group of dealers (e.g., 800.com) with whom they've cut sweet profit sharing deals with. B&M authorized dealers are not the same as online authorized dealers. So, if an unauthorized online dealer sells you a Sony product, Sony could both refuse to service the product and/or punish the unauthorized dealer with poor terms and inventory allocation.

 

[BrianW]

These practices are regulated by the FTC and manufacturers are often sued by the government for unfair business practices since it is basically price fixing.

Unless more than one manufacturer is involved, as was the case with the RIAA (multiple record labels), this isn’t price fixing. A manufacturer requiring its distributors to enter into a contract that requires a minimum advertised price is perfectly legal and is not considered price fixing. But when two or more manufacturers get together and agree not to sell their competing products below a certain price, thereby circumventing the societal benefits of free-market competition, then, and only then, are they engaging in the illegal practice of price fixing.

 

[Tom Johnson]

MAP stands for minimum advertised price. There is nothing illegal about it and it has nothing to do with price fixing. Some retailers are using such wording to make you think they are the only ones doing something special for you. Dealers can charge whatever the like for the product. Many times dealer advertisments are actually paid for by the manufacturer. Since the manufacturer is paying for the ad they establish a minimum price it can be advertised for. Now a dealer is still allowed to charge even less on the ad, however based on the agreement with the manufacturer, the ad costs will only be reimbursed if it is listed at or above the MAP.

 

[Don Black]

...which sounds innocent enough except that the ad dollars being reimbursed total $50+ billion each year worldwide (co-op dollars + MDFs).

 

[Scott H]

MAP stands for minimum advertised price. Dealers can charge whatever the like for the product.

Right, thus a reseller can't always advertise their price, or even post it on a website due to an arrangement with the manufacturer. It's not necessarily a ploy to make the buyer think it's a bargain, that just tends to be in-hand with this. I know for a fact that new Gibson guitars, for example, can not be listed for sale below a certain price point. They can still be sold at a lower price, but you will have to be quoted the price as it won't be posted on sites or in ads even if it's the sale price. If a reseller fails to do this they may have their "authorized" status revoked which could be very bad if it's one of their key lines/products.

Btw, this has nothing to do with MSRP. It's perfectly fine to advertise below MSRP.