Why Some Items Make You 'Add to Cart' to See the Price

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KEY POINTS

  • Many manufacturers use Minimum Advertised Price (MAP) policies to dictate how low a price their products can be advertised at in promotional materials.
  • The digital workaround is to add the item to your shopping cart.
  • Since MAP policies don't restrict what price the item can be sold for, they're considered fair use in the U.S. -- though MAP usage is restricted in the European Union.

An extra step to stymy comparison shoppers?

Online "window" shopping has become one of my favorite personal-finance-friendly hobbies. Filling a digital cart with this and that provides a similar satisfaction to strolling the stores -- without the need to put on outside clothes or, you know, leave the house.

But there's a weird little quirk I've run across while online shopping that you simply don't see in stores. While most items will conveniently list the price right there on the product page, every now and then, I'll see an item that isn't so forthcoming. Rather than display the price, it tells me I must "Add to Cart" to see how much it costs.

What gives? Why make me jump through this extra hoop?

As it turns out, it's not really the retailer's fault. It's instead due to rules set forth by the manufacturer. (Rules, it's worth noting, that are actually illegal in many countries.)

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The Minimum Advertised Price (MAP)

The particular practice at play here is known as the Minimum Advertised Price (MAP). This is a policy set by the manufacturer that limits how low a retailer can advertise a given item's price.

Note the distinction here; it's not a rule about how much they can sell the item for -- it's about how low a price they can advertise. In other words, while a retailer can sell a given item for whatever price they like, they can't market the item for a price lower than the MAP rate in their sales flyers or commercials.

But it doesn't stop there. For the purposes of MAP rules, this applies not just to promotional materials but to openly displaying the price on their website as well.

Why all the bother? In general, it's due to branding. If you're trying to curate a feeling of luxury around your product, having some uppity retailer lowball your MSRP (manufacturer suggested retail price) can undermine your goal. How fancy can a product be if someone is selling it at half the price?

It's also a tool used to keep competition in check by manufacturers that sell their own products. For example, Apple may use MAP to restrict other retailers from advertising Apple products well below the rate at which Apple sells them on its own website.

The "Add to Cart" loophole

So, if MAP policies prohibit marketing the price lower than the MAP rate on their websites, how can online retailers let shoppers know what the item actually costs? That's where the "Add to Cart" function comes into play.

You see, adding an item to your online shopping cart implies a certain intent to purchase the item. As such, giving you the price at this point is no longer considered to be advertisement -- it's simply part of the sales agreement.

Think about it this way: The retailer must be allowed to show you the price at some point. No one (outside a few of the ultra wealthy) is going to buy an item if they don't know how much it costs.

On the plus side, adding an item to your cart is as far as you need to go in most cases; you typically don't need to add your credit card information or create an account to see the price. However, a few sites (I'm looking at you, Costco!) are even more restrictive, and you may need to log into your account to see prices on certain products.

The international distinctions

In general, the distinction between advertised price and sale price is what keeps MAP policies legal, at least in the United States. Since MAP doesn't stop the retailer from selling the products at whatever price they like, U.S. law doesn't typically consider it to be an antitrust violation.

Other countries…have a different view. Specifically, the European Union generally considers MAP policies to be restrictive of fair competition and therefore prohibits their use.

What retailers can do is make suggestions. Providing an MSRP, for instance, is perfectly fine -- so long as it remains within the retailer's discretion whether or not to abide by it. But manufacturers aren't allowed to apply penalties for advertising or selling items below a given price.

Common sense pricing

Whether MAP policies are anti-competition is a matter for lawyers to debate. Personally, I wonder how necessary they really are. I mean, how often is a retailer really going to price products so low as to annoy the manufacturer? The retailer still needs to make a profit, so I'd think common sense would impact the pricing far more than MAP policies.

Either way, they seem to be here to stay, at least for U.S. shoppers. But hopefully you now at least know why the restriction is there -- and how you can get around it.

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