Digital Retail Price Index (DRPI) illustrates the benefits to consumers ...

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Digital Retail Price Index

Introduction

The Centre for Economics and Business Research (Cebr) was commissioned by TalkTalk to undertake a study quantifying the levels of price inflation observed in both online and in-store retail channels. The study adopts a top-down approach, using macroeconomic retail trade data from the Office for National Statistics (ONS), overseas trade data from HM Revenue & Customs (HMRC) and inflation data from the UK?s main import markets.

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Our Findings

• The Digital Retail Price Index (DRPI) shows online prices falling by around 0.7% between Q2 2011 and Q2 2012, meaning that DRPI inflation now stands at its lowest rate for nearly five years.

• The low rate of DRPI inflation seen this quarter is mainly due to UK-based internet retailers, which reported prices falling at a year-on-year rate of 0.8% in Q2 2012. This contrasts with Internationally-based internet retailers, which saw prices fall by a more modest 0.1% over the same period.

• While DRPI inflation was in negative territory in Q2 2012, inflation on our In-Store Price Comparator Index remained firmly positive, with prices growing at a year-on-year rate of 1.6% over the same time period. That is, while online shoppers have seen a fall in prices over the past year (on the DRPI measure), those purchasing similar goods on the High Street would have seen rising prices.

• Over the past five years, prices have grown much less slowly on the DRPI than the In-Store Price Comparator Index, with prices growing by 3.0% compared with 6.2%.

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Click here for the full report

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Source: http://www.cebr.com/?p=958

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