In July 2022, online prices decreased 1 percent year-over-year (YoY) (after increasing 0.3 percent YoY in June and 2 percent YoY in May) and dropped 2 percent on a monthly basis. July is the first month where e-commerce entered deflation, after 25 consecutive months of persistent online inflation. Most of the categories tracked by the DPI (14 out of 18) saw month-over-month (MoM) price decreases in July.
Prices for electronics, the largest category in e-commerce with 18.6 percent share of spend in 2021, fell sharply and decreased 9.3 percent YoY (down 2 percent MoM). This is a greater YoY decrease than June (down 7.3 percent YoY) and May (down 6.5 percent YoY).
Prices for apparel fell 1 percent YoY (down 6.3 percent MoM), marking the second consecutive month where prices fell after dropping 0.1 percent YoY in June. Apparel prices had increased for 14 consecutive months since April 2021, with prices having spiked in recent months (up 9 percent YoY in May, 12.3 percent YoY in April and 16.3 percent YoY in March).
Toy prices fell significantly, dropping 8.2 percent YoY (down 2.9 percent MoM), a record YoY low for the category in the last 31 months. Food costs remained high however, with grocery prices rising 13.4 percent YoY (up 1.4 percent MoM), a record YoY high and the largest increase of any category.
In July, consumers spent $73.7 billion online, $400 million less than the prior month ($74.1 billion). On a YoY basis however, e-commerce spend in July grew 20.9 percent, with Prime Day driving record online sales for the retail industry overall. Online spending in July also decreased compared to May ($78.8 billion) and April ($77.8 billion). E-commerce demand remains resilient on a year-to-date basis, with consumers spending $525.4 billion online in 2022 so far, growing 9.2 percent YoY.