Continuation of My Discussion on Over-Reaching MAP Price Policies

Many scuba manufacturers seem set on the concept of “creating a level playing field” for all dealers…local scuba stores and internet retailers alike. I have honestly never understood what this means, given that I can’t think of any other area of life where the playing field is level.

Scuba industry MAP price policies are really an attempt to buffer the difference between the traditional scuba store and the newer business models used by internet retailers. The major scuba companies seem to be trying to achieve a situation where the same price exists for a given product, regardless of the geographic location of the market, regardless of the economic strength of the market area, and regardless of the business model of the retailer offering the product. Most, fearing direct movement toward minimum retail price policies, attempt to do this through writing VERY restrictive MAP price policies that actually achieve the same thing. I would argue that “the same price” is confusing to consumers, who expect to see the natural variation in prices, and absent that variation, expect that something is rigged. I would argue that creating “the same price” for all retailers would be anything but level. In fact, this is a pricing concept that guarantees that the playing field is NOT level. In the internet scuba retail business (and this is EXACTLY what this is all about), the concept of “the same price” heavily favors the larger, established internet retailers. They already have the most traffic, they already have the highest customer count, they already have the marketing advantage. For a smaller internet retailer, this level playing field completely eliminates the ability to grow market share, by using the important motivator of price to obtain new customers. Many smaller internet retailers need to go head to head with the larger retailers, on price, in order to gain some market share.

The major scuba companies have an unusual group of supporters in the establishment of these very restrictive MAP policies….the largest scuba internet retailers. I personally KNOW that some of the large retailers want complete price parity; they want “the same price”. It protects their margins, but mostly, it prevents any “upstarts” from encroaching on their market, through lower prices driven by leaner operations and a willingness to surrender profit margin for website traffic and business growth. In other words, it prevents new internet retailers from gaining market share EXACTLY the same way the big guys did it in the beginning….with price competition. Over-reaching MAP price policies that insist upon “the same price”, and complete elimination of all discounts, simply give a never-ending, manufacturer-protected franchise to the biggest of the big scuba internet retailers.

I realize that many manufacturers, from a variety of industries, have MAP price policies. Scuba manufacturers certainly have the right to do the same. However, when the policies are written with rules and restrictions that are so over-reaching that they extend beyond price advertising, and attempt to attain “the same price” everywhere, then that is going too far. In our industry, already saddled with many systemic problems with few solutions, we don’t benefit when structures are put in place that prevent dealer to dealer competition in all areas, including price.

Phil Ellis

Discount Scuba Gear and Equipment at DiveSports.com