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Price parity

Price parity is keeping a product at the same price in every sales channel, whether a brand asks resellers for it or a platform requires it of sellers.

How it works

Two sides ask for parity. A brand wants its products to cost about the same in its own shop, at resellers and on marketplaces. So it recommends a retail price (RRP) and sometimes a minimum advertised price (MAP).

A sales platform may require sellers not to offer better terms elsewhere; EU rules call this a parity obligation. Under Regulation 2022/720, an obligation not to sell on better terms through competing platforms falls outside the block exemption and is assessed case by case.

Google’s shopping knowledge panel lists the sellers of one product, recognised by details such as product identifiers, so a reseller’s lower price can appear next to yours. How to respond: channel conflict in Google Shopping.

Example

Example store, not client data.

A porcelain maker recommends 600 for its dinner set. The tableware shop sells it at 600, a reseller at 540. A shopper sees a gap of 60: the shop’s price is 600 ÷ 540 = 1.11× the reseller’s, or 11% above it.

Not to be confused with

  • Price competitiveness — how your price compares with what other retailers charge for the same product on Google. It shows the outcome, not the agreement behind it.
  • Channel conflict — the clash itself, when partners undercut you for the same buyer. Parity is one way to manage it.

Right and wrong readings

  • Wrong: “As the brand, we can require EU resellers not to advertise below our price.” Right: the Commission’s guidelines treat minimum advertised prices as indirect resale price maintenance, a hardcore restriction. They allow that a targeted one may be justified in narrow cases, such as stopping a reseller that regularly sells below the wholesale price. The supplier must prove the benefits.
  • Wrong: “Any recommended price breaks EU rules.” Right: Article 4(a) of Regulation 2022/720 allows recommended and maximum prices unless pressure or incentives turn them into a fixed or minimum price.
  • Wrong: “To protect prices, we can ban resellers from comparison sites.” Right: the guidelines call an outright ban a hardcore restriction, except for sites aimed at a territory reserved exclusively for other distributors or the supplier.

Sources