Company admits the tests "raised concerns"
-
Instacart says shoppers will now see the same price for the same item at the same store on the same day
-
A new report found some customers were charged up to 23% more than others for identical groceries
-
Consumer advocates say the experiment treated shoppers unfairly at a time of high food inflation
Instacart will stop using artificial intelligence to test different prices on the same grocery items after a new consumer watchdog report found that shoppers were often charged different amounts for identical products.
In a blog post published Monday, the grocery delivery platform said it had ended the pricing experiments effective immediately, acknowledging that the practice raised concerns among customers already struggling with rising food costs.
We understand that the tests we ran with a small number of retail partners that resulted in different prices for the same item at the same store missed the mark for some customers, the company said. At a time when families are working exceptionally hard to stretch every grocery dollar, those tests raised concerns.
Different prices for the same groceries
The announcement follows a report released this month by Consumer Reports and the Groundwork Collaborative, which examined pricing on Instacart for more than 400 shoppers in four U.S. cities.
The researchers found that Instacart sometimes displayed as many as five different prices for the same item at the same store on the same day. On average, the gap between the highest and lowest prices for identical items was 13%, with some shoppers seeing prices as much as 23% higher than others.
In one example cited in the report, a dozen Lucerne eggs at a Safeway store in Washington, D.C., were listed at $3.99, $4.28, $4.59, $4.69 and $4.79 on Instacart, depending on the shopper. At a Safeway in Seattle, a box of 10 Clif Chocolate Chip Energy Bars was priced at $19.43, $19.99 or $21.99.
The study estimated that, over the course of a year, a shopper consistently exposed to the higher prices could theoretically spend up to $1,200 more on groceries.
Company backs away from testing
Instacart said that going forward, shoppers purchasing the same items from the same store on the same day will see identical prices. Retail partners will still set prices and may charge different prices across different store locations, the company said.
The company emphasized that the experiments were not dynamic pricing like that used by airlines or ride-hailing services, and said prices were not based on personal characteristics such as income. Instead, Instacart described the tests as limited experiments aimed at helping retailers optimize pricing.
The pricing program was tied to Instacarts 2022 acquisition of Eversight, an artificial intelligence company whose software allows retailers to test millions of price combinations. Instacart marketing materials previously claimed the experiments would be largely unnoticeable to consumers while potentially increasing store revenue by up to 3%.
Consumer backlash grows
Consumer advocates said the findings underscore growing concerns about the use of algorithmic pricing in essential markets such as food.
American grocery shoppers arent guinea pigs, and they should be able to expect a fair price when theyre shopping, Lindsey Owens, executive director of the Groundwork Collaborative, said in an interview with the Los Angeles Times earlier this month.
The controversy echoes recent public backlash against other companies that have explored variable pricing for everyday goods, including fast-food chains that floated the idea of surge pricing during busy hours.
Investors also reacted to the news. Shares of Instacart fell about 2% in midday trading Monday after the company announced it was ending the price experiments.
Posted: 2025-12-22 21:41:03
