Since June 2022, a new annex to the consumer protection law has entered into force in the European Union, limiting the use of discounts. The article will explain how it affected the promo activities on Joom.

Please note that the changes only affect customers from the EU.

1. Discounts and strikethrough prices

According to the newest regulation, a price reduction can be announced only if a product’s current price is less than its lowest price within a period of 30 days. In this case, the lowest price is considered the “prior price” and appears as a strikethrough price. The current price is also indicated on the product, and the amount of discount is calculated according to the strikethrough price.

Example:

The regular price for a product is €10. Its lowest price within 30 days before the current promo is €8. To be considered as a discount, the price must be below €8. Therefore, the price of €9 was not shown as a discount but the current price €7 is shown as a discount off the €8 MSRP (the lowest price).

How are the discounts displayed on Joom now?

• The system ignores MSRP from merchants;
• The strikethrough price is calculated as the lowest price within 30 days before the current promotion;
• The amount of discount is calculated based on the strikethrough price;
• If the current price is greater than or equal to the lowest price within the last 30 days, the discount and the strikethrough price will not be displayed.

2. Regular prices instead of discounts

Merchants may still lower their prices based on the regular prices even so the current price is greater than the lowest price within the last 30 days. However, due to EU regulations, it cannot be displayed as a discount.

Example:

10 days ago the price (€9) was lower than the regular price (€10), but still higher than the lowest price in the last 30 days (€8).

In such cases, Joom will still notify customers about the price benefits they get from buying the product so that they can appreciate it. Now we are testing several options for displaying the benefits. In general we plan to display the current price along with the regular price of the product instead of a discount. 

How does it influence the promotions?

• Products can participate in the promotions even if the current price is greater than the lowest price within the last 30 days;
• In this case, Joom will display the current price along with the regular price of the product so that users can evaluate the benefits of the current price. The discount amount or the strikethrough price will not be displayed;
• If a merchant reduces the product price directly without participating in promotion, the regular price will also be displayed next to the current price so that users can evaluate the benefits of the current price.

3. Limit on promotion participation

To comply with EU regulations, a product on Joom may participate in promotion for a minor part of the time. In other words, the product must be sold at the regular price for at least half of the days in a month.

However, merchants can still add products to promotions for more than 50% of calendar days. Products that exceed the promo participation limit will be automatically removed from the promotion and the price reduction will not be applied.

Now Joom is testing other options for working with products that have exceeded the promo participation limit such as issuing points to users instead of discounts, etc.

To learn more on Joom promotions please refer to the article "Promotions".