Ever Run Into This PLA Problem? We’ve Got a Few Solutions For You
If you’re in the ecommerce game, you’re likely familiar with the Minimum Advertised Pricing (MAP) policy shared by manufacturers and retailers. In fact, you may have found yourself in some conflicting situations due to MAP – like a loss of sales, ineffective budget allocation, or even a suspension from Google.
While there are some quick fixes to the issues that arise around MAP products, it’s important to recognize the impact these decisions have on your overall strategy. Does this all sound too familiar? Maybe you’ve found yourself in a scenario like this one:
Merchant X sells products from Manufacturer Y. Manufacturer Y requires Merchant X to sell its product, a smart TV, for $2,200. But because Merchant X is in a really competitive market and wants to appeal to price-conscious shoppers, it doesn’t want to advertise its smart TV at the price of $2,200, but rather $1,800. And so that $1,800 reflects in its shopping feed. (Which may not make Manufacturer Y too happy).
Though it can’t advertise the lower price on its product page due to the MAP established by its manufacturer, Merchant X uses a simple ‘work-around’ by instead displaying “See Price in Cart”. This brings shoppers to the cart, where they’ll find that $1,800 price, intriguing them to make a purchase.
Seems like a pretty fool-proof method for adhering to everyone’s rules, while offering the most competitive pricing, right?
Wrong. Unfortunately, if you’ve been working in Google Shopping for some time, you likely know that the cornerstone of the program is complete data accuracy – meaning that data from the shopping feed, like price and availability, MUST match what’s on the product landing page. Google is constantly crawling pages to ensure that data feeds and landing pages are consistent, and an inconsistency in price like the one mentioned above is a definite red flag for Google. Ultimately, it will identify the “See Price in Cart” message as a $0 price, or no price at all – and that doesn’t match the feed.
When working under a contract with a MAP policy, a retailer has the authority to sell a product for whatever price it chooses, but its advertised price must meet the minimum established by the manufacturer. Merchant X doesn’t want to ruffle anyone’s feathers, certainly not Google’s. But in the above scenario, it risks 1) damaging the manufacturer relationship and 2) having its item disapproved in the Google Merchant Center (GMC), so ultimately its ad won’t be served. Even worse, Merchant X’s account can be all together suspended by Google. And who wants to deal with that headache?
So rather than upsetting your manufacturer, breaking Google’s policies and missing out on a heartbreaking number of sales and customers, there are a couple of solutions here:
Solution #1: Remove the products from your shopping feed
If you want to sell items at a more competitive price, you can elect to take those items out of your feed. In other words, Google won’t detect any inconsistencies and you won’t technically be advertising at a price lower than that established by your manufacturer, because the products will no longer be part of your PLA program. In this case, you’d want to give your text ads a boost, and get creative with ad copy, as these types of ads aren’t restricted by MAP.
The Catch: While you miss out on the potential headache of a suspended account, you may also miss out on a substantial number of sales with PLA’s not running for these products – especially if you know that PLA programs have performed well in the past. It can also leave you with an out-of-whack budget if you anticipated spending the bulk of it on these campaigns. Even worse, customers that likely waited all season to see your sale may elect a competitor instead.
Solution #2: Merchant Promos
If you want to keep your PLA program running, but still really want to offer the competitive price to customers, you can opt to use merchant promos. Merchant promos are used to highlight a discount that comes into play after the product page (like in the shopping cart). In Merchant X’s case, the cost of the smart TV would show as $2,200 in the feed, PLA and landing page, but the promo – like “$400 off” – would be reflected at checkout.
The Catch: This seems like a pretty effective option, but it requires a lot of communication between the retailer, agency and/or shopping feed manager (if applicable). And like all things related to Google, there are several rules to be followed in order to qualify a merchant promo – if you miss one, you’ll just find yourself penalized again anyway.
Which solution you choose will depend on a variety of factors, but will almost always be determined by your overall strategy. That’s why it’s important to consider your priorities and sales goals before selecting either one.