Our 6-Month MAPP Experiment and Why It Failed

28 January 2019 | 35 Comments

In spring of 2018, after much deliberation and debate, I quietly implemented an Amazon-specific minimum advertised price policy (MAPP). 6 months later, the policy was dead. Here’s what happened.

Why MAPP?

I’m a big believer in capitalism and the free market. I love that we sell games to distributors who sell to thousands of retailers worldwide. With a few extreme exceptions, I don’t monitor what those retailers do. I don’t check on them to see if their bathrooms are clean, that their staff can accurately answer questions about our games, or that online stores are shipping well-packed boxes. Consumers decide from their experiences with those stores if they want to continue to shop there.

Most importantly, both brick-and-mortar and online hobby-game retailers add value to customers in a variety of ways. They run events, accept preorders, offer loyalty programs, personalized service…the list goes on.

Then along comes Amazon. Stonemaier Games doesn’t sell through Amazon, nor do we sell directly to Amazon. Amazon’s main value offering is price. Their entire algorithm is structured around the idea of vendors (and Amazon itself) competing on price, cent by cent.

While I appreciate consumers wanting to get a good deal, I came to believe that the “race to the bottom” resulting from Amazon’s algorithm was a problem. Sure, there are other online retailers that discount our games, but those retailers don’t also host third-party vendors who are incentivized to compete for the lowest price. Clever? Yes. Good for our long-term relationships with all other retailers who do a lot more to serve their customers? Not so much.

That’s why I implemented an Amazon-specific MAPP. I wanted to address the problem at the source. While there are other companies that implement industry-wide MAPP (or across entire regions), I just wanted to focus on what I perceived to be the problem. Plus, I am Stonemaier Games’ only employee, and I already work 80 hours a week–I couldn’t add another 10 hours just to monitor every store and website out there that sells our games. Amazon actually makes it quite easy to see vendors and their prices for each product.

How Did It Work?

I kept the policy short and sweet:

Stonemaier Games has an advertising policy on all products sold through and by Amazon.com in the US. This policy takes effect on April 15, 2018. Vendors may not advertise or otherwise promote Stonemaier products at a price lower than 20% below MSRP on the Amazon.com marketplace. This applies to prices visible to customers who are logged in or logged out of their Amazon accounts. Unilateral exceptions to this policy may only be granted via communication between Stonemaier Games and distributors based on sell-through rates, particularly after a product has been on the market for 6+ months.

Distributors are responsible for informing their retailers of this policy and for halting sales to retailers who violate this policy. Any violation of this agreement may result in termination of the right to purchase Stonemaier Games products.

This was posted on our website and disseminated in our retailer/distributor e-newsletter about a month and a half before it began. There was a little confusion about the “unilateral exceptions” sentence, which was basically there to assure vendors that if we had a complete dud of a product, we might make an exception to MAPP for that product so their not stuck with inventory they can’t sell.

What Happened Next?

On April 15, I looked through Amazon.com listings of our products to find that most vendors updated their prices to exactly match the 20% discount. I gave the violators a few days of leeway, and then I started compiling a list to report to distributors.

After the first time I reported violators to distributors, I got a bunch of e-mails from vendors saying they had no idea the policy existed. While this would turn out to be a common excuse throughout the process, I think most of these requests were legitimate, as it turned out that a few distributors hadn’t communicated the MAPP to any of their retailers. We gave them a pass on this and moved forward.

For the next few months, I would monitor the prices of our main products on Amazon every week or so, and I would report violators to distributors once a month, politely asking them to stop selling to those retailers.

I’m not sure what changed, but after a while I decided to first contact vendors through Amazon to let them know they were violating MAPP. If they responded and corrected the price, I wouldn’t report them as violators.

Why Did It Fail?

Over the summer and early fall, there were an accumulating number of issues:

  • Every week or so, I would hear from vendors who claimed they didn’t know about the policy and thus shouldn’t be punished for violating it. I couldn’t prove whether or not their distributor had told them about the policy. In most cases, I simply went to the distributor and asked if the vendor was on their e-newsletter when they announced the MAPP. Sometimes I got responses, sometimes not–neither party wanted to be held responsible.
  • Vendors on Amazon often obfuscate their legal name or other identities, making it difficult for distributors to mark them as violators. You might be surprised by how many brick-and-mortar game stores also sell on Amazon under different names.
  • Monitoring MAPP became a much bigger part of my job than I wanted it to be. At first I was only checking every few weeks, but by the end I was checking nearly every day (and finding new violators every time I checked). I think there are some monitoring apps that can help with this process, but I don’t think they let you contact the vendor through Amazon’s messaging system.
  • There is no way to enforce MAPP at the moment of the violation. That is, if Cheap-O-Games on Amazon is selling Viticulture for $19, I can’t prevent them from doing so. Amazon doesn’t care. I simply have to wait until Cheap-O-Games runs out of inventory, after which distributors won’t sell our games to them anymore.
  • The biggest problem, though, is that Amazon itself will not adhere to MAPP. I foolishly thought that I could game the system, because Amazon’s algorithm typically matches the lowest vendor price. So if I could get vendors to respect MAPP, so would Amazon. That actually worked well for a while…but then, as far as I could tell, Amazon’s algorithm started looking at other online retailers as well. So even if the lowest vendor price on Amazon’s marketplace for Viticulture was a MAPP-friendly $48, Amazon might be selling it for $45.95 because that’s $0.04 lower than a hobby-game online retailer. This really frustrated vendors who were following the rules, and justifiably so. Even though it seems like I could stop selling games to the distributor who sells to Amazon, that’s not going to stop Amazon from getting our games. They’ll just find someone else.

So, without solutions for these issues, I ended our MAPP on October 30.

Were There Any Positive Results?

Really, there was one benefit that emerged from the experiment. You see, just because the MAPP was over didn’t mean that certain vendors hadn’t violated it. We continue to ask distributors not to sell to those vendors. So the benefit is that we identified a number of vendors who either (a) don’t read communications from distributors and/or (b) are inherently sneaky and shifty–not exactly the types of vendors we want carrying our brand.

***

Even though it failed, in hindsight I’m glad I tried this experiment. I learned a lot about how the Amazon marketplace works. And honestly, I have nothing against Amazon. We bring joy to a lot of tabletops worldwide thanks to Amazon’s platform. I certainly wish their algorithm didn’t promote a race to the bottom, and I hope other retailers can continue to find creative ways to entice customers. I want to sell our games in a wide variety of ways to best fit the needs of different consumers.

I don’t feel comfortable recommending or not recommending MAPP, but if it’s something you’re considering for your company, hopefully this post has provided some value for you.

I know that MAPP and Amazon are contentious topics, so please keep your comments constructive and respectful (to me and to each other). I’d love to hear your opinions, though, and I’m happy to answer your questions.

If you gain value from the 100 articles Jamey publishes on this blog each year, please consider championing this content!

35 Comments on “Our 6-Month MAPP Experiment and Why It Failed

  1. Thank you for this article, Jamey! MAPP is something I’d love to implement someday, and your experience was very informative.

  2. Jamey, I’m selling my card game KinderPerfect.com through Amazon and even though I generally don’t wholesale it to retailers who sell on Amazon, I too am dealing with unscrupulous listing hoppers.

    Oh and wait till you check eBay and find the sellers who don’t even carry your games – they just sell at $1 over Amazon and buy from Amazon and ship direct to their customers.

    It’s the Wild Wild West online these days.

  3. Oh and if any of your vendors sells directly to Amazon (Vendor Central) vs FBA (Seller Central) then game over on price. Amazon will always be the lowest absolute online price – ie. if it’s $14.99 on Site A exclusive of shipping, then Amazon will sell at $14.95 inclusive of shipping.

    I was lucky to dodge that error early on, thankfully.

  4. I’m confused… if you sell to distributors and get paid why do you care what price retailers sell at? Isn’t that the free market at work?

    1. Several things at play here.

      First and probably most important, if other retailers see a game selling on Amazon (or other online discounters) for cheaper than they can sell it – and in some cases, cheaper than they can *buy* it, even at their discount – they may stop stocking your game because they see it as a money sink. From that perspective, Amazon’s price is the market price, regardless of what Jamey says it is.

      Customers will also see a game sold at full price on the shelves at their game store, or online from stores who pay attention to MSRP, and figure that someone’s trying to upsell because they can get it cheaper online. They’ll either just buy it online or expect a store to price-match, neither of which is a great outcome for the store.

      There’s also the perceptual difference that if Jamey prices a game at $40 but I can buy it for $30, the real perceived value to me is $30, not $40 – and that means if his next similar game is priced at $40, I see that as a $10 increase rather than equivalent pricing, and then I go around saying that Jamey doesn’t know the price of his own games.

      All of this means that while Jamey has gotten paid for this game, the NEXT one might be a harder sell, even with identical components and at an identical price.

      1. I can see this being “true”.

        I wonder has any other product from an other industry managed to enforce an MAPP with Amazon without setting up a MAAP department in their company.

        With board games maybe Tim Fowers come close but I think that might be because his games don’t go to distributors and retailers AFAIK.

        I can imagine a retailer that bought lots of games, that are not selling, wanting to just break-even or make a small lose to get back his shelf space and reinvest but I don’t see that happening with a Stonemaier game. Surely there is one case study from another industry, or is the Amazon algorithm too powerful!

      2. I see this thinking regularly on multiple forums, and I have to stop myself from screaming at them as they will not understand. They all think that Amazon, or CSI or MM are the price. Yes, I as a consumer generally look for good prices on games, but I also know that the price I am getting is not MSRP.

  5. The Canadian’s had to setup a kind of police force to control the price of Maple. Maybe distributors didn’t have the staff to take on that extra work. There is a documentary on Netflix about it called The Maple Syrup Heist.

    Hopefully the customers that buy a Stonemaier game at a 25% discount realize the quality and don’t hesitate to buy other Stonemaier titles at the normal price.

  6. We were literally discussing implementing a MAPP policy earlier today for Dice Throne (due to the exact same reasons you listed). Thank you so much for saving us some headache. It’s such a complicated issue… :(

    1. Coincidentally, Nate, I took an hour this afternoon to play a 2-player game of Dice Throne for tomorrow’s video (my first game was 6 players, which was great for learning, but I thought it would be best to play it with 2 before discussing my favorite mechanism in it).

      1. Amazing! Incredibly encouraging to hear :D

        Also, I would highly discourage learning Dice Throne in a 6-player game (sorry if it dragged on). We even have a big warning message on our variants pamphlet (https://variants.dicethrone.com). Dice Throne plays best 2-4 players and can be great with 5-6 as long as everyone knows what they are doing so that the pace of the game stays rapid.

        I’m excited for tomorrow’s video. Thanks for giving sooooo much wisdom to this community Jamey!

  7. Interesting experiment. I’m not convinced anyone has any leverage on Amazon, though, and as long as it’s far easier to sign up new vendors than remove old ones, that will always be a problem…

    The story about communication reminded me of something I read – a college professor put something in the syllabus to the extent of ‘the first student to whisper some secret word to me gets $5′. They just wanted to see if anyone read it. One day a student came up, got $5 as expected, and the professor said they were the first one in years to actually do it…’

    Is there any way to bypass the distributors and reach the retailers directly?

    1. Chris: It is possible to sell directly to retailers (lots of Kickstarter creators do it), but it significantly complicates the shipping process if you’re doing it on an ongoing basis. Like, imaging if I gave you 1000 games each week to ship to 10 different distributors. Now imagine that instead you had to ship those 1000 games to 500 different retailers every week. And they get free shipping.

  8. A suggestion would be, to tell distributors to inform retailers that they need to subscribe to a newsletter of yours, if hey want to het your products. A way to
    A. Know the retailers list and easy to monitor them
    B. Know they first hand got an important piece of information so you have proof later on.
    C. If they deny, you do not make business with them.

    Toxix backers could be one thing, but toxic retailers another. And the impact is greater.
    B. Know they first hand got an important piece of information so you have proof later on.
    C. If they deny, you do not make business with them.

    Toxix backers could be one thing, but toxic retailers another. And the impact is greater.

    1. Harry, you might be onto something there. The tough part is that just because someone subscribes to something doesn’t mean they actually read it. :) But I absolutely agree with you about how damaging it can be to have a toxic retailer battling against you. I’ve had that happen.

      1. No but having a signed mapp requirement would…it would also, hopefully ensure the sales reps for the big 2 or 3 distributors left we’re reaching out and engaging customers about your games…when I ran sales for AEG back in the day I was fortunate enough to have a full time CS staff to reach out to our retail base but that was a different time, and even then we had internet sales issues to deal with even before Amazon came along

  9. I don’t know how Cards Against Humanity have pulled it off, but on amazon.co.uk only they (or an authorized designated reseller) can sell their games on amazon. The product is ‘ineligible’ for marketplace resellers to sell.

    I’m very curious about this. Perhaps it’s something to do with the Amazon Brand Registry program…

  10. Amazon’s main value proposition is its recommendation engine, not its price. Their price is okay, but it’s often beaten by niche retailers.

  11. Great article!
    Side note: As an Amazon shopper (mostly because they gave me a credit card), if I found a copy of Viticulture for $19… I wouldn’t sleep at night if I didn’t buy it!!!

  12. Hi Jamey, really insightful article as per usual, thanks for sharing.

    I would challenge the notion that Amazon’s primary value offering is price though. Here, in the UK anyway, when it comes to board games Amazon are often not the cheapest. What they offer is speed (popular titles can be delivered within the hour, and anything else usually next day), convenience (deliver people that will leave the parcel in a safe place, rather than the dreaded card through your door) and support (if something isn’t right I can speak to someone 24/7 via chat or chat, and with free returns).

    So while all your points still stand just know, for me anyway, that Amazon offers lots more than just price. Whether they choose to use these differentiators for good or bad is of course key.

  13. “I’m a big believer in capitalism and the free market.”

    “Good for our long-term relationships with all other retailers who do a lot more to serve their customers? Not so much.”

    The contradiction here is what bothers me the most. You can be free-market, or you can artificially set a price floor, but IMHO you can’t do both. The romanticized connection that some people have with their FLGS, and the idea that they should be protected also bothers me. Small B&M retail can’t even come close to competitive pricing anymore, and in MANY instances they don’t make up that gap in other ways. There’s some strange idea that not only should you buy games from your local game shop, but you should also make friends with them and afford them the same courtesies you would to a friend – something none of my local game shops have earned or even seem interested in. If retailers “do a lot more to serve their customers” then they should charge for those services. I’m very much in favor of seeing local shops adapt and expand to try and offer something more – such as serving food, renting private play spaces, renting board games, hosting events, etc. I will gladly pay money for these services, but what I will almost never do is pay MSRP on board games purely out of the kindness of my heart.

    1. When I visited Toronto, I spent two days at Snakes and Lattes, whose business model seems to essentially be rentable board game space. The place was packed most of the time. That’s very different from the local game store model whose model is essentially to sell a product but then support that product with occasional free playing time. Our local game stores have all closed, but a local toy store recently started selling some hobby games (but no play space). It’s no surprise that the old LGS model is struggling. On the other hand, I can see that the S&L cafe model continues to both bring new people to the hobby and be profitable by providing a service that both the new and experienced hobbyists want.

  14. […] Stonemaier’s Failed MAPP ExperimentJamie Steigmaier wrote about his company’s attempt to use a minimum advertised price policy. “I foolishly thought that I could game the system, because Amazon’s algorithm typically matches the lowest vendor price. So if I could get vendors to respect MAPP, so would Amazon. That actually worked well for a while…but then, as far as I could tell, Amazon’s algorithm started looking at other online retailers as well.”Source: https://stonemaiergames.com/our-6-month-mapp-experiment-and-why-it-failed/ […]

  15. Jamey, you comment a few times on the “race to the bottom”. What does the “bottom” look like to you? What’s the worst-case scenario?

    1. Josh: That’s a great question. I think it depends a bit on the timing and the product, but a general answer would be when a game is sold just barely above the price paid by the vendor (or lower than that).

  16. I think no one can implement MAPP. Free online market will always have the upper hand in this fight. The only option I see is to educate people so the know why the price in their FLGS is 20% higher than online.
    To help brick and mortar stores I have seen two things done by other publishers, which may help a bit:
    1) Add special add-ons to your games that can be sold only by brick and mortar stores (and not online, only when the game is picked up in person).
    2) When the game launches, for a certain amount of time (month for example), the game can be sold only in a b&m store on the spot.

    But as you say there will always be stores who violate this rule. Some you will catch, others you won’t. You may put the pressure on distributors to handle this telling them you will cut down on their deliveries and frankly don’t care how they contact their stores. If they will know that this will impact their income maybe they will find a way to communicate it clearly ;)

    Maybe there is a need for the industry to have a legitimate database of all FLGS. A database, to which any publisher / distributor could connect to and verify if the store is ok to get a special promo or product for running a b&m and having a reasonable price policy. One single offence noted, your out of the list for good. But who would run that? Quite a lot of effort would be needed to set i up.

  17. Jamey I’ve been looking at a semi-self distribution model, where the games are shipped directly to small retailers and hobby stores (with restrictions) via an international shipper (FedEx, DHL…) each retailer would split the shipping cost with the publisher. A MSRP of 60 (game cost of 10) would leave 5O cushion to split between publisher and retailers. This would allow some retail to do deeper discounts on games (based on their own profit models) while also limiting their supplies.

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