Kenwood Gets Tough on MAP

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Internet car electronics sales rose six percent from 2007 to 2009, while traditional specialist 12 volt business remained flat, said Kenwood Electronics, citing the NPD Group data.
Internet sales may be going strong, but they are a sticky wicket to suppliers who want to protect their minimum advertised price (MAP) policy. Kenwood claims it’s simplifying the problem by strictly enforcing its Internet and MAP policies effective April 1 including “in-cart” pricing.
“A lot of companies have these policies…but too many times there’s been no enforcement. Now we have very clearly delineated enforcement steps for first violation, second violation and third violation and everyone knows the remedies, “ said senior VP consumer electronics for Kenwood, Keith Lehmann. The company also hired Net Enforcers, a company used by many 12 volt suppliers to help find offending websites.
A first violation of MAP (minimum advertised price) will result in a warning letter from Kenwood and then additional steps are taken including cease and desist.
You may ask (as we did), yes but is Kenwood willing to lose business as a result of its new policy? Lehmann says, “We are prepared to accept lower sales from an important account should they violate the policy.” Kenwood has already “had a couple of cease and desist cases and a few violation letters.”
And you might also ask (as we did), but isn’t it impossible to stop transshipping and MAP violations? To this Lehmann says if you cut off the source you can reduce the problem, which is becoming more critical as sales on the Internet are expected to continue to rise. He sites other companies who have had success in limiting transshipping including Bose and Polk.
Kenwood dealers continue to have separate Internet and general retailer agreements. To sell on the Internet you must be a Kenwood Authorized Internet Retailer. To sell in the brick and mortar world you must be a Master Authorized Retailer, said the company.
Source: Kenwood Electronics
Photo: Keith Lehmann, Kenwood SVP consumer electronics

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