Adobe: Online prices continue climbing in January
Year-over-year online inflation grew for the 20th consecutive month in January 2022.
According to the latest online inflation data from the Adobe Digital Price Index (DPI), in January 2022, online prices increased 2.7% year-over-year (YoY) and 1.1% month-over-month (MoM). During January 2022, 13 of the 18 categories tracked by the Adobe Digital Price Index saw YoY price increases, with apparel rising faster than any other category. Price drops were observed in five categories: electronics, jewelry, books, toys and computers.
On a MoM basis, 15 of the 18 categories tracked by the Adobe DPI saw January price increases; with price drops observed in three categories - apparel, medical equipment/supplies, and flowers/related gifts.
Notable categories in the Adobe Digital Price Index (January 2022)
Groceries: Prices were up 5.8% YoY (up 1.2% MoM), the highest increase for the category on an annual basis. It exceeded the high point in October 2020, during the first year of the COVID-19 pandemic, when prices jumped 5.2% YoY. January marks the 24th consecutive month where online prices have risen for groceries, making it the only Adobe DPI category that has moved in tandem with the Consumer Price Index, which tracks prices consumers pay in physical stores.
Medical equipment and supplies: Prices were up 8.2% YoY (down 0.1% MoM), the highest increase for the category on an annual basis. It coincided with a January surge in the COVID-19 Omicron variant, which drove greater demand for testing kits at a time when overall supply was constrained.
Office supplies: After eight consecutive months where online prices fell or were flat on an annual basis in this category, office supplies increased 1.5% YoY (up 2.2% MoM) in January. Adobe analysis indicates COVID-19 variants have kept many consumers working from home, driving up demand and prices for products in home offices.
Electronics: Prices were down 3.4% YoY, a greater price drop compared to December 2021, when online prices were down 2.6% YoY. On a MoM basis, electronics prices are up 2% in January after holiday discounts seen in the prior month.
Apparel: Prices were up 15.8% YoY (down 1.7% MoM), a slowing rate of YoY growth from the holiday season, where prices increased 17.3% YoY in November 2021 and 16.6% in December 2021.
[Read more: CGP: Holiday sales driven more by inflation than by organic growth]
“While price drops in categories like electronics and apparel have brought online inflation down slightly from the record high last November, consumers are still contending with elevated prices in the digital economy,” said Patrick Brown, VP of growth marketing and insights, Adobe. “This is particularly notable in a category like groceries, where online prices continue to hit new records, while consumer demand for online grocery shopping remains heightened.”
The Adobe Digital Price Index (DPI) is modeled after the Consumer Price Index (CPI), 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.