Media Alert: Adobe Digital Price Index: Grocery Prices Fall 3.7% Month over Month in August

• Grocery prices online fell 3.7% in August from July 2024, marking the largest month-over-month (MoM) decline since Adobe began tracking online prices in 2014.
• On a year-over-year (YoY) basis, grocery prices rose 0.5%, a smaller jump compared with July 2024's 4.2% YoY increase.
• Overall, online prices have now fallen for 24 consecutive months, down 4.4% YoY in August, as consumers continue to see bargains in discretionary categories such as electronics, toys and apparel.

SAN JOSE, Calif. - Today, Adobe (Nasdaq:ADBE) announced the latest online inflation data from the Adobe Digital Price Index (DPI), powered by Adobe Analytics. In August 2024, online prices fell 4.4%year-over-year (YoY) and 0.3% month-over-month (MoM). This marks 24 consecutive months where online prices have decreased on an annual basis, and the fifth consecutive month where prices have fallen on a monthly basis. August's YoY price decline was driven by notable drops in major discretionary categories such as electronics, toys and apparel. Grocery prices rose in August YoY, but the price increase has slowed; The category also fell significantly MoM.

In electronics, prices were down 5.3% YoY in August (down 0.3% MoM), after falling 5.9% YoY in the month prior (July 2024). Prices for apparel fell 9.0% YoY (up 0.8% MoM), marking 12 consecutive months where prices have fallen on an annual basis. In toys, prices fell 5.6% YoY (down 1.2% MoM), marking forty-one consecutive months where prices have fallen on an annual basis. And in furniture and bedding, a steadily growing e-commerce category, prices fell 5.0% YoY in August (flat MoM); This category has now seen prices fall YoY for 19 consecutive months.

In the grocery category, prices rose 0.5% YoY in August. This is a smaller YoY increase compared to July 2024, when prices rose 4.2% YoY, and is down from the peak in September 2022, when prices rose 14.3% YoY. On a monthly basis, grocery prices online fell 3.7% in August, the largest MoM drop observed since Adobe began tracking online prices in 2014. The second biggest MoM drop was in July 2019 at 1.8%. Other categories that saw prices jump in August include personal care (up 0.9% YoY, up 1.4% MoM) and non-prescription drugs (up 1.8% YoY, down 0.9% MoM).

The DPI provides the most comprehensive view into how much consumers pay for goods online. Powered by Adobe Analytics, it analyzes one trillion visits to retail sites and over 100 million SKUs across 18 product categories: electronics, apparel, appliances, books, toys, computers, groceries, furniture/bedding, tools/home improvement, home/garden, pet products, jewelry, medical equipment/supplies, sporting goods, personal care products, flowers/related gifts, non-prescription drugs and office supplies.

In August, four of the 18 categories tracked by the DPI saw YoY price increases, with non-prescription drugs rising the most. Price drops were observed in 14 categories, including electronics, office supplies, jewelry, books, furniture/bedding, toys, home/garden, pet products, tools/home improvement, appliances, flowers/related gifts, computers, sporting goods and apparel.

Five of the 18 categories in the DPI saw price increases MoM, with furniture/bedding prices flat MoM. Price drops were observed across 12 categories, including electronics, office supplies, books, toys, home/garden, pet products, grocery, non-prescription drugs, flowers/related gifts, computers, sporting goods, and medical equipment/supplies.

Notable Categories in the Adobe DPI for August:

• Groceries: Prices rose 0.5% YoY (down 3.7% MoM), a slower increase than the month prior at 4.2% YoY (July 2024). After hitting a peak in September 2022 when prices rose by 14.3% YoY, price increases slowed for 18 months through March 2024 (up 2.5% YoY). Then in April 2024, grocery prices rose more substantially at 2.6% YoY, followed by a slower increase in May (up 2.1% YoY). In June, price increases accelerated at 3.7% YoY followed by July at 4.2% YoY. Consumers are increasingly buying more of their groceries online, and this category has generally moved in lock step with the Consumer Price Index.
• Personal Care: Prices rose 0.9% YoY (up 1.4% MoM), a greater increase than the month prior at 0.8% YoY (July 2024). Prices for the category have now risen for five consecutive months, after dropping 0.3% YoY in March 2024 and 1.0% YoY in February 2024. The personal category also includes cosmetics, a growing e-commerce segment that drove $25.8 billion spend so far this year (January to August 2024), up 7.8% YoY.
• Apparel: Prices were down 9.0% YoY (up 0.8% MoM), falling faster than pre-pandemic levels when apparel prices fell 1.1% YoY on average between 2015 and 2019. Back in August 2022, apparel prices rose 4.9% YoY and continued to rise for 13 consecutive months. Prices then fell 2.7% YoY in September 2023 and continued to fall for 12 consecutive months; And in November 2023, apparel prices fell 12.4% YoY during the holiday shopping season, the largest YoY drop observed since Adobe began tracking online prices in 2014.
• Furniture/Bedding: Prices were down 5.0% YoY (flat MoM), falling faster than pre-pandemic levels when furniture/bedding prices fell 2.6% YoY on average between 2015 and 2019. Starting back in May 2020, prices for the category had risen YoY for 33 consecutive months, peaking in March 2021 at 5.7%. Then in February 2023, prices fell 0.1% YoY and continued to fall for 18 consecutive months through August 2024. Consumers are increasingly buying furniture and bedding online, with $87.4 billion spent so far this year (January to August 2024), up 1.9% YoY; As a result, price movements in this category are having a more notable impact on overall prices online.

Methodology

The 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.

Powered by Adobe Analytics, Adobe uses a combination of Adobe's AI and machine learning framework and manual effort to segment products into the categories defined by the CPI manual. The methodology was first developed alongside renowned economists Austan Goolsbee and Pete Klenow.

About Adobe

Adobe is changing the world through digital experiences. For more information, visit www.adobe.com.

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