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Why do Internet retailers obscure prices by using phrases like “Add to Cart To See Price”

April 4, 2012

Most of the largest Internet retailers spend lots of time and lots of resources collecting research about their customers shopping habits and preferences. Most of your biggest internet retailers won’t even change the homepage without first running an A versus B test to see how a new homepage would impact the conversion rate. Of all the things they test though, the one thing that Internet shoppers seem most pre-occupied with is the same thing their mouse is frantically scouring for when they land on a product page – the price. If it’s true that top websites invest considerable thought in designing the visibility and aesthetic appeal of prices and pricing indicators, then it raises the question “if savvy E-tailers know I’m looking for the price, why would they obscure it with the phrase “add to cart to see price”?

The answer revolves around manufacturers use of what is referred to as a MAP policy, or Minimum Advertised Price. Manufacturers who use map policies attempt to preserve the value of their products in a competitive marketplace, by requiring distributors not to sell certain products below a minimum advertised price. Whereas some manufacturers have strict MAP policies, others have none at all, and the rest fall somewhere in between. Manufacturers who have and enforce their MAP policies employ a variety of tactics to get compliance and or encourage participation. These methods can include everything from allocating special funds for compliance, to taking away budget allowances that manufacturers grant to retailers for marketing their products. In the most severe cases, manufactures can and have stopped supplying distributors with products to sell. Manufacturers with strict MAP programs usually have an internal employee, or may even hire an outside company, whose tasked with shopping an authorized dealer’s site to see if they are in compliance of their program.

In order to circumnavigate this issue and still allow their distributors some flexibility in trying to be competitive, some manufacturers allow online retailers to sell the product below the minimum advertised price by letting them use the phrase “add to cart to see price”. In these cases the seller of the product is viewed as in compliance with the program because they are not actually “advertising” the product below the minimum price.

Usually products that say, “add to cart to see price” are some of the best and most competitively priced products on the Internet.

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1 Comment

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