Challenges Associated with Using Scanner Data for the Consumer Price Index - ARCHIVED

Practically all major retailers use scanners to record the information on their transactions with clients (consumers). These data normally include the product code, a brief description, the price and the quantity sold. This is an extremely relevant data source for statistical programs such as Statistics Canada’s Consumer Price Index (CPI), one of Canada’s most important economic indicators. Using scanner data could improve the quality of the CPI by increasing the number of prices used in calculations, expanding geographic coverage and including the quantities sold, among other things, while lowering data collection costs. However, using these data presents many challenges. An examination of scanner data from a first retailer revealed a high rate of change in product identification codes over a one-year period. The effects of these changes pose challenges from a product classification and estimate quality perspective. This article focuses on the issues associated with acquiring, classifying and examining these data to assess their quality for use in the CPI.