Adobe data showed that while demand for computers and TV’s was up in May and June YoY – 33 and 28 per cent respectively – growth in July slowed to 16 percent and turned negative in August with a 10 per cent YoY decrease in sales, likely due to Brexit and other factors driving uncertainty in Europe.
Adobe’s first UK Digital Price Index suggests that online sales of durable goods, such as computers, and TVs, fell by 10 per cent, compared to the same time last year, in August, while at the same time, sales rose by 30.2 per cent in the US.
Adobe leverages machine learning in Adobe Marketing Cloud to surface economic insights from billions of data points. By tracking seven dollars and fifty cents out of every ten dollars spent online with the top 500 U.S. retailers and over six dollars out of every ten dollars spent online with the top 100 European retailers, the DPI is able to analyze billions of digital transactions. Adobe is the first company to conduct a digital-centric analysis based on real-time access to price-paid data and actual quantities sold.
Unlike other models, Adobe Digital Insights leverages the Fisher Ideal Price method, which uses actual quantities purchased to measure inflation and is recognized by leading economists as the gold standard for the calculation of inflation. To produce the August DPI, Adobe analyzed 15 billion U.S. website visits, 3 billion UK website visits and online transactions for over 2.4 million different products.
In coming months Adobe will be working with the UK government’s Office for National Statistics (ONS) to analyse data around inflation and online sales in the UK and the US.
“There has been little good, micro-level data on the real economy in the UK to help us understand the impact of the Brexit vote,” said Austan Goolsbee, professor of economics, at The University of Chicago’s Booth School of Business and former chairman of the Council of Economic Advisers for President Obama. “The Adobe DPI data suggest that prices for groceries and electronics did not change significantly. It will be important to keep monitoring the data in the months ahead.”
“New data sources such as those being used by Adobe provide innovative ways to understand our increasingly digital economy in real time,” said Jonathan Athow, deputy national statistician, UK Office for National Statistics. “Many of these opportunities will be realised by bringing together independent, official statisticians and others in the UK and across the world who are using these new data sources and techniques.”
“We may be seeing early signs of hesitancy in spending on durable goods in the UK, whereas spending remains stable for essential goods like groceries,” said Mickey Mericle, vice president, marketing and customer insights at Adobe. “It will take time to fully grasp Brexit’s effect on the economy and as we expand the UK data we’re incorporating in the DPI, we expect to uncover more trends. We are also excited to start working with government agencies like the ONS to further refine the methodology and surface more insights.”