Adobe: Online prices decrease by largest amount since May 2020

E-commerce inflation continues to trend in a positive direction.

U.S. online prices in June 2023 fell 2.6% year-over-year (YoY), marking the 10th consecutive month of year-over-year (YoY) price decreases, according to the latest data from the Adobe Digital Price Index (DPI), based on Adobe Analytics, The decline was also the biggest YoY decrease in online prices tracked by Adobe since May 2020. On a month-over-month (MoM) basis, online prices fell 1.3% in June 2023.

More than half of Adobe’s tracked categories (11 of 18) saw prices fall on a YoY basis. Adobe data indicates that price drops have been driven by sharp declines in categories including electronics (down 12.9% YoY and 2.3% MoM), computers (down 16.9% YoY and 2.5% MoM), and appliances (down 8.3% YoY and 1.3% MoM). 

The largest YoY drop in online prices tracked by Adobe in June 2023 was in the flowers and related gifts category, which fell 29.7% YoY and 6.1% MoM. Seven categories experienced YoY online price increases in June, including personal care, pet products, groceries, non-prescription drugs, tools/home improvement, medical equipment/supplies and apparel. 

In some categories where online prices continue rising YoY, increases have slowed. Compared to an 8.2% YoY increase in May 2023, online grocery prices were up 7.6% YoY (and 0.1% MoM) in June, marking the ninth consecutive month where YoY price increases for groceries have decelerated from September 2022’s record high 14.3% YoY increase.

Adobe analysis reveals that online price increases for pet products have also slowed, rising 8.1% YoY and 0.1% MoM) in June 2023, down from May 2023’s 10.2% YoY increase and April 2023’s 11.3% YoY increase. 

Notable categories in the Adobe Digital Price Index for June  2023

• Groceries: Price increases have slowed for the grocery category, which rose 7.6% YoY (up 0.1% MoM), compared to a May YoY increase of 8.2%, 9.3% YoY in April and 10.3% YoY in March. According to Adobe analysis, consumers are continuing to purchase more groceries online, and this category has moved in lock step with the Consumer Price Index. 
• Appliances: Prices were down 8.3% YoY and 1.3% MoM, 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 have fallen sharply in recently months, dropping 12.9% YoY and 2.3% MoM in June 2023 and 12% YoY in May 2023. As a major discretionary category, Adobe says electronics price movements have a significant impact on overall inflation online. 

The Adobe 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.