Media Alert: Adobe Digital Price Index: Online Inflation Hits Another High in December

Adobe (Nasdaq:ADBE) today announced the latest online inflation data from the Adobe Digital Price Index (DPI). In December 2021, online prices increased 3.1%year-over-year (YoY) and 0.8% month-over-month (MoM). Meanwhile, consumer spending online for all of 2021 reached a record $855 billion, an increase of 9% YoY, attesting to the strength of the digital economy overall. December’s price increases marked the 19th consecutive month of YoY online inflation and followed the record high of November 2021, when online prices increased 3.5% YoY. In December, groceries and apparel were standout categories, with grocery prices seeing their highest annual increase in more than a year (4.9% YoY, 0.7% MoM). Apparel increased 16.6% YoY (0.6% 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, nonprescription drugs and office supplies.

“Inflation online is showing no signs of easing, as durable consumer demand is being met with the same, persistent supply challenges that produced over six billion out-of-stock messages online this holiday season,” said Patrick Brown, vice president of growth marketing and insights, Adobe. “As consumers contend with higher offline prices for everything from gas to rent, they are finding that e-commerce is still a less expensive option when it comes to goods like toys, electronics and even jewelry.”

In December 2021, 12 of the 18 categories tracked by the DPI saw YoY price increases, with apparel rising faster than any other category. Price drops were observed in six categories: electronics, office supplies, jewelry, books, toys and computers.

On a MoM basis, 13 of the 18 categories saw December price increases, with price drops observed in five categories, including toys, pet products, home/garden, computers and flowers/related gifts.

Adobe Holiday Season Recap Report: For additional insights on the 2021 holiday shopping season (November 1 to December 31) including consumer spend online, out-of-stock levels and more, find Adobe’s recap report here.

The DPI is modeled after the Consumer Price Index, 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.

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

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