Adobe Digital Economy Project -- May 2017

© 2017 Adobe Systems Incorporated. All Rights Reserved.
ADOBE DIGITAL ECONOMY PROJECT
MAY 2017 UPDATE

© 2017 Adobe Systems Incorporated. All Rights Reserved.© 2017 Adobe Systems Incorporated. All Rights Reserved.
Main Takeaways: May
2
 The Adobe DEP releases new estimates for pricing and online shopping behavior for apparel at the national level in the U.S. this month. In May, the DEP finds
the following:
 Fashion thrives online: revenue in apparel from new products makes up the largest share of spending (80.5%) among all categories tracked by the DPI
 Online apparel targets the female economy: women’s clothes account for over half of spending in apparel online (53.9%) but only a third of apparel spending offline (36.3%)
 The DPI finds apparel prices show deflation YoY (-4.3%). Lowest priced apparel shows the highest level of deflation (-7.5%) while the most expensive apparel shows the second-largest level of deflation (-5.5%).
 Items of men’s clothing tend to cost more than items of women’s apparel, and women’s clothes are purchased roughly equally in the highest- and lowest-priced categories, while spending on men’s clothing is
concentrated more at the highest level
 In the U.S., topline inflation is down across DPI categories for the second time in a row (-0.3% in the all-items index and flat but very slightly negative in the all-
items less grocery index). This is the second month of deflation in the DPI following four straight months of inflation. Prices remain down year-over-year in the
all-items index (-0.8%) and down for the all-items less grocery index (-1.2%)
 Deflation is driven in May by a drop in prices for furniture and bedding (down -2.0% MoM), declines in grocery (-0.5% MoM), and deflation in several durables categories including appliances (-1.5% MoM),
computers (-0.8% MoM), and electronics (-0.8%). Deflation in appliances and furniture and bedding is typical of Memorial Day Holiday sales in the U.S.
 In grocery, deflation in May was driven primarily by dairy products: ice cream and related products (-4.5% MoM), eggs (-2.1%), other dairy (-1.9%), and cheese (-1.7%) saw steep deflation during the month. This
bodes well for consumers who were experiencing several months of rising food prices in the U.S.
 The DPI also shows that meanwhile consumers in the U.K. are facing higher prices for food, where grocery prices have been rising since last September and
are up 1.7% YoY. The DPI for groceries in the U.K. reveals that inflation in the category is on the rise again after a one-month reprieve following six straight
months of inflation in the category
 For the fourth month in a row the Adobe DPI features state-level estimates for inflation. 31 out of the 50 states and D.C. show deflation in May, while 20 show
inflation MoM

Adobe Digital Insights Background
Based on analysis ofaggregated and anonymous data from Adobe Experience Cloud:
• Adobe Analytics and Adobe Mobile Services
Thousands of brands worldwide including two thirds of Fortune 50 companies rely on Adobe
Experience Cloud:
• $7.50ofevery $10spent online with top 500 U.S.retailers go through Adobe Experience Cloud **
• Adobe Experience Cloud powers:
• 20 ofthe top 30 U.S.employers
• 9 of10largest hotel groups
• 7of10largest airlines
**Latest IR Top 500 Report 2015
3
Adobe
Analytics
Adobe
Mobile Services

Economist Advisors
4
Austan Goolsbee, University of Chicago
 Robert P. Gwinn Professor of Economics at The University of Chicago's Booth School of Business
 Formerly served as President Obama’s Chairman of the Council of Economic Advisers
 Served as the youngest member of President Obama’s cabinet
Pete Klenow, Stanford University
 Professor, Department of Economics, Stanford University
 Currently Visiting Scholar, Federal Reserve Bank of San Francisco
 Member of editorial boards for Econometrica, American Economic Review, Quarterly Journal of Economics and others

© 2017 Adobe Systems Incorporated. All Rights Reserved.© 2017 Adobe Systems Incorporated. All Rights Reserved. 5
Digital Price Index
(DPI)
Job Seeking Index
(JSI)
Digital Housing Index
(DHI)

Digital Price Index Methodology
(DPI)

Methodology – U.K.
7
Based on analysis of aggregated and anonymous data
• Fisher Ideal Price Index
• $6 of every $10 spent online with top 100 European retailers go through Adobe Experience Cloud **
• Based on analysis 1 billion website visits and 100k products sold online
ONS: Consumer Price Index Adobe: Digital Price Index
Quantities Sold No Yes
Products/quantities updated Annually Daily
Number of Products 180,000
100k
(currently covered categories)
Data Collection Frequency Monthly Daily
Data Availability Monthly Daily
Offline Prices Yes No
Long history Yes No
All categories of spending Yes No
** Latest IR U.K. Top 500 Report 2015

Methodology – U.S.
8
Based on analysis of aggregated and anonymous data
• Fisher Ideal Price Index
• Adobe measures 80% of all online transactions from top 100 U.S. retailers **
• $7.50 of every $10 spent online with top 500 U.S. retailers go through Adobe Experience Cloud **
• Based on analysis of 15 billion website visits and 2.2 million products sold online
BLS: Consumer Price Index
BEA: Personal Consumption
Expenditures
Adobe: Digital Price Index
Quantities Sold No No Yes
Products/quantities updated Every 2 years Monthly Daily
Number of Products 83 thousand (all categories) 83 thousand (all categories)
2.5 million
(currently covered categories)
Data Collection Frequency Bi-Monthly Monthly Daily
Data Availability Monthly Monthly Daily
Offline Prices Yes Yes No
Long history Yes Yes No
All categories of spending Yes Yes No
Index Type Laspeyeres Fisher Ideal Fisher Ideal
** Latest IR Top 500 Report 2015

Big data in DPI decreases uncertainty
9
DPI CPI
Appliances 0.15% 0.46%
Airfare 0.08% 0.51%
Computers 0.28% 0.49%
Furniture and bedding 0.07% 0.31%
Grocery 0.10% 0.12%
Hotels: domestic 0.04% 2.30%
Medical equipment and supplies 0.20% 0.39%
Nonprescription Drugs 0.18% 0.47%
Sporting Goods 0.12% 0.31%
Televisions 0.24% 0.60%
Toys 0.25% 0.59%

Inflation rates by price ranges
10
• Televisions have seen higher-ticket items
deflate faster than lower-ticket items in 2015
• For computers, mid-range models priced
between $700 and $1,200 showed the
highest deflation last year
*Price bins are determined based on the price the product had when originally launched
(first price).

The Importance of detail: Black Friday discount comparisons
11
• DPI captures the effect of major discount holidays
like Black Friday and Cyber Monday because it
measures quantities and does so in real-time
• Prices online for Televisions dropped later in
November 2016 than in 2015, with more discounts
during the Black Friday week (Monday 11/21 through
Cyber Monday), which accounted for more than half
of all Televisions units purchased between
November and December
• Television prices then increased more in December
2016 than they did in December 2015, a sign that
retailers were able to capitalize on later shopping

Measuring rapidly shifting consumer preferences
12
• Electronics see an average of 77% of online
spend on new* products**
• 17% of monthly online spend for groceries
on new products
* Products that have been available for 1 year or less
** A product is defined as an item for purchase which has an unique identifier (such as a SKU)

State-by-state inflation: examples of sources of variance
13
1. Different baskets across states
• Consumers in western states buy more on organic fruits and vegetables than other regions
• Consumers in southern states buy more meats, poultry and fish than other regions
2. Different shopping attitudes, preferences across states
• Consumers in states with lower median incomes tend to shop more on heavy-promotion days
3. Different prices for same products across states
• Price-only variances across states tend to be bigger in groceries and smaller in consumer electronics

Digital Price Index Findings, U.K.
(DPI)

U.K. Food Prices Up Nearly Two Percent Year-Over-Year
15
• U.K. grocery prices show inflation again in May after a one month
reprieve in April following six straight months of inflation. Adobe
DPI for the U.K. shows cumulative inflation for groceries of 1.7%
YoY (May 2016 to May 2017). Prices are up 0.1% MoM. Prices have
been on the rise since September 2016
• U.K. computers show YoY inflation while televisions show YoY
deflation, but both categories show deflation in May 2017.
• Computers in the U.K. saw a -0.1% deflation in April but the category is
showing 0.7% inflation YoY. This is in contrast to the U.S. where prices
are down 3.9% YoY in computers.
• Televisions continue to deflate in May, TVs in the U.K. saw a ----2.8%
deflation in April, bringing the category to -16.5% YoY. These price
declines are similar to the U.S. where prices are down 14.9% YoY.

Digital Price Index Findings, U.S.
(DPI)

Apparel Methodology
17
The Adobe Digital Economy Project relies on a new methodology to calculate inflation in apparel in the U.S. Calculating inflation in
apparel is a challenge for economists in the public and private sector because of the steep discounts and strong fashion cycle in the
category.
• Standard DPI Methodology: match products and retailers month over month, calculate inflation via Fisher price index using
only matched products.
• Using a matched-product method results in extremely steep deflation YoY because apparel has such significant product
turnover and deep discounting. Using a matched model, we show sometimes upwards of 30% or 40% deflation year-over-year.
• New Method: line up products by subcategory grouping and price bin (e.g. men’s sportscoats between $0-$100, $100-$200,
$200-300, $400 and above)
• 684 detailed categories that roll up to 6 subcategories (men’s, women’s, boy’s, girl’s, baby, and footwear – matches the CPI
subcategories)

DPI vs. CPI: Online Shopping Leads to More Deflation
18
• CPI shows relatively flat YoY inflation (0.5%) in
apparel
• Adobe DPI shows -4.3% YoY deflation in May
• Women’s apparel shows -4.7% deflation in May
• Men’s apparel shows -2.9% YoY deflation in May
• Deflation in the Adobe DPI likely reflects
preference of online shoppers to buy on sale
and purchase discounted clothes-4.3%
0.5%
-6.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
5/1/2016 6/1/2016 7/1/2016 8/1/2016 9/1/2016 10/1/2016 11/1/2016 12/1/2016 1/1/2017 2/1/2017 3/1/2017 4/1/2017 5/1/2017
Apparel Inflation, YoY (May 2016 - May 2017)
Apparel - DPI Apparel - CPI

Novelty Fashion: Cheap Apparel, High-End Discounts Driving Deflation
19
• The least expensive clothes have the largest
levels of deflation (-7.5% YoY)
• The most expensive clothes have the second
largest levels of deflation (-5.5% YoY)
-5.5%
-2.4%
-1.7%
-7.5%
-14.0%
-12.0%
-10.0%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
5/1/2016 6/1/2016 7/1/2016 8/1/2016 9/1/2016 10/1/2016 11/1/2016 12/1/2016 1/1/2017 2/1/2017 3/1/2017 4/1/2017 5/1/2017
May 2015 - May 2016 YoY Cumulative Inflation by Price Bin
$110 and Above $70-$110 $30-$70 $0-$30

Online vs. Offline: Women’s Clothes Purchased More Online
20
53.9%
36.3%
18.6%
21.1%
13.4%
24.5%
5.5%
5.3%
4.5%
7.3%
4.1% 5.5%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
Share of Online Revenue in Apparel Share of Offline Revenue in Apparel
Womens Mens Footwear Infants and Toddlers Girls Boys
• Online revenue from women’s clothes makes
up over half of all spending (53.9%) in the
apparel category
• Men’s clothes are purchased as a share of
apparel spending at a lower rate online (18.6%)
than offline (21.1%)
• Footwear has the largest gap between share of
offline (24.5%) and online spending (13.4%)
*Analysis of online spending for apparel spending in 2015-2016

Novelty Fashion: Online Shoppers Need Newest Fashion
21
• Among online shopping categories, consumers spend
on new products (products available for 12 months or
less) in apparel (80.5%) more than anywhere else
• Nearly a third (30.8%) of all spending on women’s
clothes goes towards products that are one month
old or less, while that figure is only 18.0% for men’s
clothing
PERCENT OF SPEND ON NEW PRODUCTS BY CATEGORY OF APPAREL**
CLOTHES AVAILABLE FOR ONE MONTH OR LESS
PERCENT OF SPEND ON NEW PRODUCTS*
CLOTHES AVAILABLE FOR TWELEVE MONTHS OR LESS
18.0%
23.6%
30.8%
82.0%
76.4%
69.2%
0.0% 20.0% 40.0% 60.0% 80.0% 100.0%
Mens
Footwear
Womens
One Month or Less More than One Month
*Analysis of online spending between 2015-2016 *Analysis of online spending in apparel between 2015-2016

Novelty Fashion: Newness Leads to Influx of Fresh Products
22
7,000 new apparel
products added daily*
3,150 1,750 1,400 700
• Thousands of apparel products are added to
eCommerce sites every day
• The largest share of those clothes items are in
women’s clothing
• Daily new products represent between 1-3%
turnover of all products in the category. New
products on average account for 4.6% of all
footwear products, 3.4% of all men’s clothes
products, 2.6% of all women’s clothes
products**
*Average daily products added in 2015-2016
**Women’s clothes have the largest number of unique items in our sample, so even though women’s clothes get the most new products added it’s a
smaller share of the overall category than footwear or men’s clothes

Novelty Fashion: Men Pay More for Clothing, Women Purchase More
23
31.49% 26.5%
22.32%
20.6%
17.89% 26.4%
28.30% 26.5%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
100.00%
Men's Women's
Top 25% Middle 25% Middle 25% Lowest 25%
Men's
Apparel
Women's
Apparel
Top 25% $230.58 $154.03
Top 50-75% $105.85 $70.79
Lowest 25-
50%
$63.97 $44.63
Lowest 25% $39.63 $21.52
SHARE OF SPENDING BY CATEGORY BY PRICE BIN
APPAREL PURCHASED IN MAY 2017
AVERAGE PRICE PAID BY CATEGORY BY PRICE BIN
APPAREL PURCHASED IN MAY 2017

Digital Price Index Findings, Apparel
(DPI)

Consistent Inflation across the U.S., but prices down YoY
25
• Price changes lean towards deflation in May: 31 out of 50
states plus D.C. are showing price declines, while 20 states are
showing price declines
• State deflation in May driven by changes in grocery prices:
States that show deflation in May tend to also have deflation in
groceries as well as deflation in goods typically on sale during the
Memorial Day weekend, including furniture

Travel driving price changes across states
26
Highest inflation by state
Lowest inflation by state
State April MoM Inflation Major Inflation Drivers
Alaska 1.1% Hotels**, Flights*
Colorado 0.9% Flights*, Hotels**
Hawaii 0.8% Flights*, Hotels**
Rhode Island 0.7% Hotels**, Flights*
South Dakota 0.7% Hotels**, Auto Parts
State April MoM Deflation Major Deflation Drivers
Arizona -0.6% Hotels**, Furniture and Bedding
D.C. -0.7% Hotels**, Furniture and Bedding*
West Virginia -0.7% Furniture and Bedding, Sporting Goods
Kentucky -0.7% Hotels**, Toys
Utah -1.2% Groceries
* Flight prices are determined by the state of flight origin
** Hotel prices reflect hotel properties in a given state
*** New categories introduced in this month’s Adobe DPI

April 2017 U.S. Recap
27
MoM: March
to April
MoM: March to
April
Difference
(percentage)
Same
Sign?
YoY: Cumulative April
2016-2017
YoY: Cumulative April
2016-2017
Difference
(percentage)
Same
Sign?
DPI CPI DPI vs. CPI DPI vs. CPI DPI CPI DPI vs. CPI DPI vs. CPI
Alcohol 0.0% 0.3% -0.3% No -0.9% 0.8% -0.8% No
Appliances -0.5% -0.4% -0.1% Yes -3.9% -2.9% -1.0% Yes
Apparel -0.9% 0.0% -0.9% No -1.2% 0.5% -1.7% No
Auto Parts 0.0% 0.1% -0.1% No -1.2% -0.4% -0.8% Yes
Computers -0.7% 0.2% -0.9% No -3.5% -5.3% 1.8% Yes
Flights 0.3% 3.7% -3.4% Yes 6.2% -0.8% 7.0% No
Furniture and bedding -0.2% -0.3% 0.1% Yes -3.8% -1.9% -1.9% Yes
Grocery 0.0% 0.2% -0.2% Yes -0.2% -0.8% 0.6% Yes
Hotels 0.1% 2.0% -1.9% Yes 2.2% 2.8% -0.7% Yes
Medical equipment and supplies -1.2% -0.1% -1.1% Yes -2.5% 1.2% -3.7% No
Nonprescription drugs -0.1% 0.0% -0.1% No -0.1% 0.7% -0.8% No
Personal care products 0.2% 0.2% 0.0% Yes -1.7% -1.0% -0.7% Yes
Pet Products 0.1% 0.1% 0.0% Yes 0.8% -0.6% 1.4% No
Sporting goods -1.3% 0.1% -1.4% No -5.8% -3.1% -2.8% Yes
Televisions 0.5% -0.6% 1.1% No -15.8% -17.9% 2.1% Yes
Tools & Home Improvement -0.5% 0.0% -0.5% No -2.5% -0.4% -2.1% Yes
Toys -1.5% -1.0% -0.5% Yes -4.7% -8.9% 4.1% Yes
Weighted Average Inflation* -0.1% 0.4% -0.4% No -0.6% -1.0% 0.4% Yes
Weighted Aggregate Inflation, Less
Grocery** -0.2% 0.4% -0.6% No -1.5% -1.0% -0.5% Yes
* Weighted average inflation is calculated using CPI-U relative component weights (2014-2015) across the shared categories in the DPI and the CPI, less apparel
** Grocery is a large component of the current CPI weights, so changes in grocery prices drive the majority of weighted average inflation. As we add more categories (like housing, auto etc.), these
aggregate numbers will change.

May 2017 U.S. Summary
28
• Main MoM inflation in May:
• Flights, hotels, nonprescription drugs, tools &
home improvements
• Main MoM deflation in May:
• Tablets, furniture and bedding, appliances,
YoY MoM
Alcohol -1.1% 0.0%
Apparel*** -4.3% 0.0%
Appliances -4.3% -1.5%
Auto Parts -1.1% -0.1%
Computers -3.9% -0.8%
Electronics -8.4% -0.8%
Flights 4.7% 2.6%
Domestic Flights 4.2% 2.8%
Intl Flights 6.3% 2.0%
Furniture and bedding -5.0% -2.0%
Grocery -0.5% -0.5%
Domestic Hotels 3.1% 1.6%
Intl Hotels 0.4% 2.4%
Medical Equipment and Supplies -1.5% -0.3%
Nonprescription Drugs 0.9% 0.1%
Personal Care Products -1.5% -0.4%
Pet Products 0.2% -0.4%
Sporting Goods -5.8% -0.3%
Tablet -15.0% -3.1%
Televisions -14.9% -1.0%
Tools & Home Improvement -1.9% 0.1%
Toys -5.7% -0.6%
Weighted Average Inflation* -0.8% -0.3%
Weighted Aggregate Inflation, Less Grocery** -1.2% 0.0%
* Weighted average inflation is calculated using CPI-U relative component weights (2014-2015) across the shared categories in the DPI and the CPI, less apparel
** Grocery is a large component of the current CPI weights, so changes in grocery prices drive the majority of weighted average inflation. As we add more categories (like housing, auto etc.), these aggregate
numbers will change.

Alcohol
29
• Adobe DPI shows cumulative deflation of -1.1% YoY (May
2016 to May 2017)
• Prices for Beer show cumulative inflation of 3.0% YoY
• Prices for Spirits show cumulative inflation of 1.2% YoY
• Prices for Wine show cumulative deflation of -3.6% YoY
• For May 2017, prices increased 0.0% vs April 2017 MoM
METHODOLOGY:
• The data used reflect transactions for ~120 K products

Appliances
30
2016 to May 2017)
• Main YoY price decreases for Appliances priced between $200
and $400
• For May 2017, prices decreased -1.5% vs April 2017 MoM
METHODOLOGY:
• The data used contains transactions for ~110 K products
• Products include large appliances such as fridges, ovens, washers, dryers as well as smaller appliances such as vacuums, mixers, blenders etc

Auto Parts
31
2016 to May 2017)
• Main YoY price decreases for Auto Parts priced greater than
$200
METHODOLOGY:
• The data used reflect transactions for ~300 K products

Airfare
32
• Adobe DPI shows cumulative inflation of 4.7% YoY (May
2016 to May 2017)
METHODOLOGY:
• The data used contains transactions for ~370 K flight routes
• Includes associated fees, where applicable

Airfare: domestic
33
2016 to May 2017)
• Largest monthly inflation to South Dakota (14.1% MoM), North
Dakota (12.7% YoY), and West Virginia (8.8% YoY)
• Largest monthly deflation to Colorado (-3.9% MoM), Arizona
(-3.1%) and Oregon (-.3.0%)
METHODOLOGY:

Airfare: international
34
• Adobe DPI shows cumulative inflation of 6.3% YoY (May 2016
to May 2017)
• Largest price increases for airfare were to South America, with
inflation of 21.6% YoY
• Largest price decreases are for airfare to Europe with deflation of
-3.4% YoY
METHODOLOGY:

Electronics
35
2016 to May 2017)
• Main YoY price decreases for Electronics priced greater than
$1500
METHODOLOGY:
• The data used contains transactions for ~1 M products
• Products span across dozens of diﬀerent categories such as televisions, laptops, Blu-ray players, desktops, tablets, wearables, headphones, video games,printersetc..

Electronics: computers
36
2016 to May 2017)
• Main YoY price decreases for Computers priced between $1200
and $1600
• Main YoY price increases for Computers priced between $0 and
$300
METHODOLOGY:

Electronics: televisions
37
2016 to May 2017)
• Main YoY price decreases for Televisions priced greater than
$2000
METHODOLOGY:

Electronics: tablets
38
2016 to May 2017)
• Main YoY price decreases for Tablets priced between $550 and
$900
METHODOLOGY:

Furniture and Bedding
39
2016 to May 2017)
• Main YoY price decreases for Furniture and bedding priced
between $150 and $250
METHODOLOGY:
• Products include interior and exterior furniture, mattresses and other bedding products

Groceries
40
2016 to May 2017)
• Main MoM deflation in ice cream and related products
(-4.5% MoM), eggs (-2.1%), other dairy (-1.9%), and
cheese (-1.7%)
METHODOLOGY:
• Our dataset covers an estimated 30-40% of all online grocery purchases. It contains transactions for ~195k products
• The mix of grocery products bought online is not the same as oﬄine – the top category for online shopping is drinks (nonalcoholic), while for oﬄine shopping it is meat

Hotels: domestic
41
METHODOLOGY:
• The data used contains transactions for ~250 K hotel properties
2016 to May 2017)
• Largest inflation in May in Alaska (14.9% MoM),
Delaware (14.1%), Rhode Island (13.9 %)
• Largest deflation in May in to Arizona (-7.6%), D.C.
(-5.3%), and Florida (-5.2%)

Hotels: international
42
METHODOLOGY:
• The data used contains transactions for ~250 K hotel properties
• Adobe DPI shows cumulative inflation of 0.4% YoY (May 2016
to May 2017)
• Largest price increases were for hotels in Europe (4.8%
inflation MoM)
• Largest price decreases were for hotels in Asia (-3.3%
deflation YoY)

Medical Equipment and Supplies
43
2016 to May 2017)
• Main YoY price decreases for Medical equipment and supplies
priced between $45 and $135
METHODOLOGY:
• The data used contains transactions for ~6,000 products
• Includes supportive and convalescent equipment, dressings and first aid kits, and medical equipment for general use

Nonprescription drugs
44
2016 to May 2017)
• Main YoY price decreases for Nonprescription Drugs priced
between $0 and $10
• Main YoY price increases for Nonprescription Drugs priced
between $25 and $40
METHODOLOGY:
• Includes all non-prescription medicines taken by swallowing, applying on your skin (such as topicals), inhaling, as suppositories, or enemas.

Personal care products
45
2016 to May 2017)
• Main YoY price decreases for Personal care products priced
between $10 and $30
• Main YoY price increases for Personal care products priced
greater than $150
METHODOLOGY:
• Includes cosmetics, lotion, hair (shampoo, conditioner) and nail care

Pet products
46
2016 to May 2017)
• Main YoY price decreases for Pet Products priced between $10
and $20
• Main YoY price increases for Pet Products priced between $0
and $10
METHODOLOGY:
• Includes pet food & treats, kitty litter and accessories (leashes, pet beds)

Sporting Goods
47
2016 to May 2017)
• Main YoY price decreases for Sporting Goods priced between
$100 and $200
METHODOLOGY:
• Products include small equipment and accessories (balls, gloves, uniforms) as well as large equipment such as treadmills, weightlifting tools etc.

Tools & Home Improvement
48
2016 to May 2017)
• Main YoY price decreases for Tools & Home Improvement priced
between $140 and $280
METHODOLOGY:

Toys
49
2016 to May 2017)
• Main YoY price decreases for Toys priced between $0 and $30
METHODOLOGY:
• Products include toys, games as well as playground equipment

Job Seeking Index
(JSI)

Online job seeking continues YoY declines
51
METHODOLOGY:
• Based on analysis of aggregated and anonymous data from more than 1 billion visits to U.S. employment-search websites and top employer career pages
• Adobe Experience Cloud powers 20 of the top 30 U.S. employers**
U.S. online job seeking is down -16.4% YoY in May

Digital Housing Index
(DHI)

Online housing search grows YoY
53
METHODOLOGY:
• Based on analysis of aggregated and anonymous data from more than 2 billion visits to U.S. housing search websites
Online search for purchases and rentals is up 12.8% YoY
in May

Appendix
54

DPI Coverage of U.S. CPI Categories
55
DPI Category
February 2017 DPI Weights
All-Items All-Items Minus Groceries
Grocery 54.00% N/A
Furniture and bedding 5.16% 11.22%
Hotels 4.99% 10.85%
Personal care products 4.79% 10.40%
Tools & Home Improvement 4.61% 10.03%
Flights 4.27% 9.27%
Pet Products 4.01% 8.72%
Alcohol 3.99% 8.68%
Sporting goods 2.95% 6.40%
Auto Parts 2.62% 5.71%
Nonprescription drugs 2.45% 5.33%
Toys 2.00% 4.35%
Computers 1.87% 4.07%
Appliances 1.21% 2.63%
Televisions 0.66% 1.44%
Medical equipment and supplies 0.41% 0.89%
Shelter
Food Away
From Home
Vehicles Apparel
Electricity,
gas etc.
Grocery
Furniture
Lodging
Personal Care
Np. Drugs
To be added to DPI
Professional
services
Hospital
services
Current DPI
Unlikely

Inflation rates by price ranges, cont’d (tablets)
56
• Tablets have seen higher-ticket items deflate
faster than lower-ticket items
• The greatest price decrease and increase in
November and December were for tablets
priced between $350 and $600
(first price).

Inflation rates by price ranges, cont’d (televisions)
57
• The highest priced televisions have have
seen faster deflation than lower priced items
• The greatest price decrease in November
and increase in December were for TVs
priced between $600 and $1,000
(first price).

Inflation rates by price ranges, cont’d (televisions)
58
• Mid-range computers have seen faster
deflation than lower and higher priced
models
• The greatest price decrease in November
were for mid range computers between
$700 and $1,200 while the greatest price
increase in December were for lower priced
models between $300 and $700
(first price).

Digital Price Index: Fisher Ideal Price Index
∑𝑖𝑖=1
𝑛𝑛
𝑃𝑃𝑖𝑖𝑖𝑖 𝑈𝑈𝑖𝑖𝑖𝑖−1
∑𝑖𝑖=1
𝑛𝑛
𝑃𝑃𝑖𝑖𝑖𝑖−1 𝑈𝑈𝑖𝑖𝑖𝑖−1
∗
∑𝑖𝑖=1
𝑛𝑛
𝑃𝑃𝑖𝑖𝑖𝑖 𝑈𝑈𝑖𝑖𝑖𝑖
∑𝑖𝑖=1
𝑛𝑛
𝑃𝑃𝑖𝑖𝑖𝑖−1 𝑈𝑈𝑖𝑖𝑖𝑖
• The Fisher Ideal Price Index uses quantities purchased on the current period (month) and a previous period
(previous month) to determine actual consumer’s preferences. Instead of assuming that consumers
preferences for what goods to buy are constant over a certain number of years, it is able to account for the fact
that they are constantly changing what they buy.
𝐹𝐹𝐹𝐹𝐹𝐹 𝐹𝐹𝐹𝐹𝐹 𝜋𝜋𝑡𝑡 =

Methodology Comparison: Fisher, Laspeyres and Paasche

Adobe Digital Economy Project -- May 2017

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