Demand cools! Prices of many online goods in the United States fell in July

Recently, data from Digital Commerce360 showed that as U.S. consumers' demand for consumer goods cooled during the epidemic, online prices of U.S. goods fell year-on-year in July for the first time since 2020. Among them, the largest price drop was in electronic products, down 9.3% from the same period last year; toy prices fell 8.2%, and clothing fell 1%.

However, online food prices remain high and are rising at an accelerated pace, with prices up a record 13.4% from the same period last year, the largest increase of all categories.

According to the Adobe Digital Price Index, before the pandemic, online commodity prices had been falling steadily for several years, with prices falling 1% each year. But since the pandemic became popular in the United States, consumer demand for online purchases has surged, and inflation has occurred for 25 consecutive months. Because the pandemic lockdown has restricted access to services such as gyms or restaurant meals, the supply chain has difficulty coping with additional demand, and the Federal Reserve is currently worried that inflation has spread from commodities to the service industry. In July of this year, slowing consumer demand broke this trend.

Patrick Brown, vice president of growth marketing and insights at Adobe, said: "Shaken consumer confidence and reduced spending, coupled with oversupply at some retailers, are driving down prices in key online categories such as electronics and apparel. As a result, U.S. consumers spent $73.7 billion online in July, down from $74.1 billion in June."

However, according to the latest research data on the US market in July released by MasterCardSpendingPulse, US e-commerce sales in July increased by 11.7% compared with the same period last year, and demand for products in multiple categories increased. The main reason is that the Prime Day promotion pushed the US e-commerce market to achieve a breakthrough growth in sales.

Separately, Adobe data shows that about 15% of U.S. retail spending is conducted through e-commerce, a percentage that has also been rising since the arrival of COVID-19.

Judging from the scale of online sales in the United States, a report by Forrester stated that US e-commerce will continue its upward trajectory, with online sales exceeding US$1 trillion this year and growing at a compound annual growth rate of 10%. It is expected that by 2027, US online consumption will reach US$1.6 trillion, accounting for almost 30% of total US retail sales.

Forrester's report also pointed out that the three most popular categories in US e-commerce are: clothing and footwear, consumer electronics, and food and beverages. In 2021, these categories accounted for 38% of US online retail sales and 41% of total US retail sales. Among them, in 2021, online retail sales of clothing and footwear were US$153 billion, online retail sales of consumer electronics were US$123 billion, and online retail sales of food and beverages were US$69 billion. According to Forrester data, all three categories are expected to nearly double by 2027.

American e-commerce

Electronics