The following Q&A comes from a Shark Tank entrepreneur. Some words have been redacted to protect the identity of the brand.
Dear Vanessa, We have an upcoming re-airing on Shark Tank. How can we take greater advantage of the exposure from a pricing standpoint while not upsetting retailers?
-Our current price point is $20.00 at retailers across the country
-I'm considering reducing our retail to $15.00 on our website for a limited time as a Shark Tank Special. We will promote it with a big online advertising campaign.
Any limited time promotional discount does not anger retailers, but just know that whatever discount price you “advertise” sets precedent for retailers. So if your MAP is $14.99, than you should never drop below your own MAP in your own promotions.
Just be clear with retailers about when the deal ends, so that retailers know it’s not “forever.” Also, if you are discounting the same SKUs that is carried by your retailers, I would give your key retailers the option to participate in the Shark Tank special, too. Note that they will expect you to cover the loss margin.
This is a great way to make your retailers feel included (not side-lined) and the reality is that most people will buy online anyways, since your campaign is digital/online. Online marketing converts to online sales, usually. So to me, there is little “downside” to having key retailers take part in the discount.
In general, you don't want to have an online store on your website that competes with your retailers. Especially for a company like yours that is in national stores and approaching big box retailers. If you do, you want to differentiate the merchandise enough so that the prices can not be compared directly. But what is done is done. I think the above suggestions will work for the time being!