The regulation on the display of discount prices, based on a EU directive, has been in force for over a year. Consumer Protection Board has also issued detailed guidance on price display and major e-stores have aligned their price display accordingly. We will write a bit more about this and also take a closer look at Lumav’s solution for Magento e-stores.
Background
Previous price disclosure is a commercial practice whereby a seller informs consumers of the previous or recommended retail price before applying a promotional price. This means that, before selling a product or service at a reduced price, the seller should provide information about the previous or recommended retail price of that product or service.
Its introduction has several important objectives:
- Helps consumers to get accurate information about the real price of a product or service. Consumers will be able to compare the previous price with the discounted price and assess whether the promotional offer is actually a promotional offer.
- Disclosing an earlier price helps to build trust and reduce consumers’ subsequent disappointment with the e-store.
- Earlier price disclosure is also important for fair competition. It ensures that sellers cannot distort the true nature of prices or use misleading tactics to attract consumers.
In Estonia, the regulations and requirements for previous price disclosures are laid down in consumer protection laws. The Consumer Protection Board monitors and controls that sellers comply with these requirements and ensure fair and transparent price information for consumers.
Amendments to the Consumer Protection Act entered into force on 28 May and contain a number of important points, including changes to the rules on notifying price reductions. Previously, a promotional price was usually compared to the regular price, but now the comparison is required to be the lowest price of the goods for at least 30 days, rather than the regular price or other price information. Exceptions include new goods which the merchant has offered for less than 30 days ( at least 7 days’ lowest price), perishable goods (the previous price is the original undiscounted selling price of the goods) and incremental discounts (for each discount, the original price before the first discount must be shown).
Price Log module for Magento
Due to the Price Discounts Directive, it is necessary for Magento to have the ability to store price history and correctly display discounts for promotional offers. For this purpose, Lumav has developed the Price Log module.
The Price Log module can request the minimum price of each product for the last 30 days. For this purpose, a minimum of 30 days is stored:
- The price change of each product with the time of change.
- When a new product is added to Magento, the time of its creation is recorded. This is necessary because new products are allowed to use the 7-day price as a reference price.
- The version of the price rule for each catalogue (catalogue price rule) with the time of the change. Exceptions are price rules that are excluded by the Magento user.
- The product addition event, or the occurrence of the first price. This is necessary because a 7-day history is sufficient for displaying the prices of new products.
Price display in e-store
In the case of a regulated campaign, the lowest price in the last 30 days is displayed as the reference price. For this purpose, both the history of product prices and the current discount rules are used, as well as the history of discount rules up to 30 days. The price rules of the last 30 days are kept and the lowest price at which the product has been sold in the last 30 days is displayed.
Exceptions are products that are more than 7 days and less than 30 days old in the shop. In this case, 7 days is used as the reference period and all the calculations described above are made within the 7 day period.
If the product is less than 7 days old, the reference price is not calculated at all. If the lowest reference price is higher than the discounted price, the reference price is also not displayed.
The module can be purchased for 280 EUR + VAT, plus installation, configuration and design customization. Ask for more information!
Summary
The desk of an e-commerce manager is full of tasks. However, it is important to take the time to familiarize yourself with the Consumer Protection and Technical Regulatory Authority regulations and to implement them in your e-store. Similar to the advent of GDPR, where many e-commerce businesses delayed compliance – the fine itself is not a big penalty, the penalty is the loss of customer trust.
If you would like to add the Price Log to your Magento e-store or any other Magento solution then please contact us.
