Dive Brief:
- Online prices in May dipped 2.3% year over year, the greatest drop since the beginning of the COVID-19 pandemic, according to Adobe’s Digital Price Index released Monday. May was the ninth consecutive month of year-over-year price decreases, Adobe found.
- The flowers and gifts category saw the greatest year-over-year price decline at 27.8%. Other categories saw noticeable year-over-year drops, including computers (16.5%), electronics (12%), appliances (7.9%) and home and garden products (6.3%).
- Multiple categories rose in price from last year, including groceries (8.2%) and personal care products (2.7%). Grocery price increases slowed for the eighth consecutive month in May, per the report.
Dive Insight:
Alongside the year-over-year price declines, Adobe’s Digital Price Index also tracked multiple month-over-month decreases. Compared to April, May prices slid by 1.2% month-over-month.
Among the categories that dipped between April and May were computers (2.4%), appliances (2.4%), electronics (1.8%) and personal care products (0.3%), per the report. On the other hand, grocery prices rose 0.3% month over month.
The year-over-year price declines are continuing from earlier this year. In March, Adobe found a 1.7% dip in online prices from the previous year. While flower and gift prices dropped by nearly a quarter, appliances and home and garden prices both decreased by 4.9% during that period. Similar to May, grocery prices saw a 10.3% jump in March. April brought similar price changes. Online prices dropped 1.8% overall, according to Adobe, and many of the same categories posted declines.
Inflation continues to push consumers to cut back on their consumption. Per a McKinsey survey released in April, eight in ten respondents said they are trading down, up from 74% in July 2022. The ongoing toll inflation has taken on consumers could catalyze retailers to negotiate better deals with their suppliers.
