14 Jul Report: Online Prices Fall 2.6 Percent in June, a 36-Month Low
Adobe reported in its Digital Price Index (DPI)* that online prices in June 2023 fell 2.6 percent year-over-year (YoY), the most significant decrease since May 2020, when prices fell 1.5 percent YoY.
June marks the 10th consecutive month of YoY price declines, with over half of Adobe’s tracked categories (11-of-18) seeing prices fall on a YoY basis. On a month-over-month (MoM) basis, online prices fell 1.3 percent in June.
Price drops were driven by sharp declines in categories including electronics, down 12.9 percent YoY and 2.3 percent MoM; computers, down 16.9 percent YoY and 2.5 percent MoM; and appliances, down 8.3 percent YoY and 1.3 percent MoM.
In recent months, YoY price increases slowed in staple categories, including groceries and pet products. Compared to May 2023’s 8.2 percent YoY increase, grocery prices were up 7.6 percent YoY and 0.1 percent MoM in June, providing some relief as consumers look for the high costs of food items to come down. June marked the ninth consecutive month where YoY price increases for groceries decelerated from September 2022’s record high, when prices rose 14.3 percent YoY.
Online price increases for pet products also slowed, up 8.1 percent YoY, up 0.1 percent MoM, in June, down from May 2023’s 10.2 percent YoY increase and April 2023’s 11.3 percent YoY increase.
Notable categories in the Adobe Digital Price Index for June
In June, the largest drop in YoY prices came in the flowers and related gifts category, which fell 29.7 percent YoY and 6.1 percent MoM. By contrast, seven categories experienced YoY price increases in June, including personal care, pet products, groceries, non-prescription drugs, tools/home improvement, medical equipment/supplies, and apparel.
Notable categories for June 2023 include:
- Groceries: Price increases slowed for the grocery category, which rose 7.6 percent YoY, up 0.1 percent MoM, compared to a May YoY increase of 8.2 percent, 9.3 percent YoY in April and 10.3 percent YoY in March. Consumers continue to purchase more groceries online, moving the category in lock-step with the Consumer Price Index.
- Appliances: Prices were down 8.3 percent YoY, and 1.3 percent MoMa, the highest drop for this category since Adobe began tracking online prices in 2014. June also marked the ninth consecutive month of falling appliance prices online.
- Electronics: Prices fell sharply recently, dropping 12.9 percent YoY, down 2.3 percent MoM, and 12 percent YoY in May. Contrast this to June 2022, when prices were down 7.3 percent YoY. As a major discretionary category, electronics price movements significantly impact overall inflation online.
- Pet Products: Prices were up 8.1 percent YoY, up 0.1 percent MoM, increasing less than months prior when prices were up 10.2 percent YoY in May 2023, up 11.3 percent in April 2023 and 11.2 percent in March 2023. Online price increases for pet products peaked in August 2022 when they were up 12.7 percent YoY.
*Adobe’s DPI is modeled after the Consumer Price Index (CPI), published by the U.S. Bureau of Labor Statistics, and uses the Fisher Price Index to track online prices. The Fisher Price Index uses quantities of matched products purchased in the current period (month) and a previous period (previous month) to calculate the price changes by category. Adobe’s analysis is weighted by the real quantities of the products purchased in the two adjacent months.