Americans shopping online got a break from soaring prices in July. Overall, prices for online goods fell by 2% on the month, as electronics, electronics, clothes, and toys became cheaper, according to the Adobe Digital Price Index.
It was the first drop in more than two years of rises as consumers cut back on online shopping and businesses discount overstocked inventories.
Adobe, which has been compiling online prices since 2014, analyzes a trillion visits to retail sites for its index. The US Bureau of Labor Statistics that puts together the consumer price index, or CPI, mostly uses in-store data, with a few exceptions.
Before the pandemic, online prices mostly moved in the opposite direction as those in brick-and-mortar stores: down. But they spiked in the spring of 2020 as Americans cooped up at home shopped more online and continue to rise. July’s data suggests a return to the pre-covid-19 trend.
Clothing gets cheaper, groceries more expensive
In July, consumers spent $400 million less online than in June, despite record sales on Prime Day, which happened on July 12 and 13 this year. Retailers with overstocked inventories are also pushing down prices, noted Patrick Brown, vice president of insights at Adobe. The biggest decrease was in prices for apparel, which went down 6.3% in the month.
But not all online goods are cheaper. Grocery prices jumped 1.4% month-over-month, and 13.4% compared to last year.
There are some signs that relief is on the way, however. The UN’s global food price index has dropped for the past four months, which means that food imports are getting cheaper. US consumers also expect food inflation along with gas inflation to accelerate less quickly in the next year than they had previously thought.