Toy Retail Deflation; even Pokemon Go is not spared

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Adobe’s July Digital Price Index (DPI) is reporting that digital retail prices for toys deflated again this month over the previous month by 1.6% (sales of electronics were down 1%). Surprisingly, it reports that retails for Pokemon-branded items declined 2.9 percent month over month. 

Why are Pokemon prices in decline? Here is what, according to Adobe,Pete Klenow, professor, Department of Economics at Stanford University. has to say: 

“The lack of inflation in Pokémon-branded items reflected in the DPI, despite their explosion in popularity, is fascinating. Among other factors, it could be that the new buyers are more price sensitive, which hints at some of the difficulties the economy is facing in raising prices, or that they have been able to ramp up production without increasing per unit costs,,,” 

Both of those answers are possible but it could be the reverse, there is so much Pokemon product available on line that supply is outstripping demand.  What do you think?

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