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Adobe Uses Vast Digital Data for More Accurate Analysis of U.S. EconomyAdobe (News - Alert) (Nasdaq:ADBE) today announced its new Digital Economy Project with the launch of three digital measurements of the U.S. economy. They include the Digital Price Index (DPI), measuring changes in online consumer goods prices, the Digital Housing Index (DHI), reporting adjustments in online housing searches, and the Job Seeking Index (JSI), measuring shifts in online job seeking activity. Two world-renowned economists -- 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, and Pete Klenow, professor, department of economics at Stanford University -- are partnering with Adobe on the DPI. By analyzing billions of digital transactions of nearly one and a half million products sold online, the DPI addresses deficiencies in traditional inflation reporting. While the DPI does not cover offline purchases like gasoline, it tracks digital transactions more accurately than any other current source. The official Consumer Price Index (CPI) compiled by the U.S. Bureau of Labor Statistics (BLS) for instance, must rely on consumer surveys to approximate the actual sales of each product category purchased by consumers. The DPI uses transaction data on the actual quantities purchased for, literally, millions of products and captures the data in real time. "The Consumer Price Index infers what is happening to product prices via in-store price checking combined with consumer surveys administered every four years which, inherently, ignores newer products. The Adobe Digital Price Index data shows that an astonishing 80 percent of monthly online spend for electronics goes to new products that have been available less than a year," said Mickey Mericle, vice president, Data Insights at Adobe. "Digital is filling the gaps in traditional inflation reporting. Real-time, large scale product pricing data is an increasingly important tool to assess the state of the economy and the tremendous volume of e-commerce data enables us to unearth macro-economic trends more accurately than ever before." Methodology Adobe is the first company to conduct a digital-centric analysis based on real-time access to price-paid data and actual quantities sold. Seven dollars and fifty cents out of every 10 dollars spent online with the top 500 U.S. retailers go through Adobe Marketing Cloud.* The DPI is based on the analysis of aggregated and anonymous data of eight billion U.S. website visits and 1.4 million products from January 2015 through February 2016. Adobe Digital Index 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. No other organization can use the Fisher Ideal Price method today because they do not have enough data or sufficiently timely data to make these calculations. With the Fisher Ideal Price method, the DPI is able to take into account that online shoppers find better prices from a competing or substitute product if the price of an item suddenly increases. In addition, because the DPI measures quantities and does so in real- time, Adobe Digital Index is able to accurately capture the effect of major discount holidays like Black Friday (News - Alert) and Cyber Monday. DPI for Electronics & Groceries The DPI launches with the analysis of two important consumer goods segments - electronics and groceries. Findings include:
"The CPI provides observations on a wide array of categories, but has always struggled to take into account the introduction of new goods," said Professor Goolsbee. "By combining actual data from previous and current transactions, Adobe has opened the door to quickly and accurately identify the shifting patterns of consumer shopping and prices in the U.S." "Adobe Marketing Cloud data is incredible, providing new insight into U.S. inflation rates," said Professor Klenow. "With the influx of digital and online commerce, we need an accurate view into inflation from that lens, and with the volume of data Adobe has access to, no other company is in a better position to assess inflation rates for product categories in real time." Job Seeking & Digital Housing Indices:
Adobe Digital Index is expected to release the DPI on a monthly basis and expand The Digital Economy Project with more granularity, more categories and additional indices to improve visibility into the digital marketplace. About Adobe Marketing Cloud Adobe Marketing Cloud empowers companies to use big data to effectively reach and engage customers and prospects with highly personalized marketing content across devices and digital touch points. Eight tightly integrated Solutions offer marketers a complete set of marketing technologies that focus on analytics, web and app experience management and creation, testing and targeting, advertising, video, audience management, social engagement and campaign orchestration. The tie-in with Adobe Creative Cloud makes it easy to quickly activate creative assets across all marketing channels. Thousands of brands worldwide including two thirds of Fortune 50 companies rely on Adobe Marketing Cloud. Helpful Links
About Adobe Systems (News - Alert) Incorporated Adobe is changing the world through digital experiences. For more information, visit www.adobe.com. *Source (News - Alert): Internet Retailer's 2015 Top 500 eGuide **Wikipedia © 2016 Adobe Systems Incorporated. All rights reserved. Adobe and the Adobe logo are either registered trademarks or trademarks of Adobe Systems Incorporated in the United States and/or other countries. All other trademarks are the property of their respective owners.
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