Instacart’s Controversial Pricing Experiment is Now Off the Menu
Instacart has announced it’s pulling the plug on its dynamic pricing practice after criticism and regulator scrutiny.
The company said it’s done testing grocery prices after shoppers were unknowingly charged different amounts for the same items.
Instacart bought pricing software Eversight in 2022 and began offering item-level price testing to retailers in 2023.
What Went Wrong?
A report from Groundwork Collaborative, Consumer Reports, and More Perfect Union found that almost three-quarters of items appeared at multiple price points.
The researchers recruited 437 shoppers across four cities to build carts simultaneously on Instacart and compare prices.
The average spread between the lowest and highest displayed price was 13%, with the biggest difference observed hitting 23%.
Regulatory Scrutiny
The Federal Trade Commission sent a civil investigative demand seeking information about the Eversight tool.
Instacart agreed to pay $60 million in refunds to settle separate FTC claims about delivery fees and free trials.
Congress is also circling, with House Oversight ranking member Robert Garcia asking Instacart for details about its pricing practices.
What’s Next?
Instacart’s exit still leaves an important caveat: Retailers will continue setting their own prices on Instacart.
Shoppers may tolerate personalized ads, but when the number on the receipt starts feeling experimental, trust gets expensive.
Instacart’s defense was that the tests were short-term, randomized experiments, not personalized pricing.
Source: Link
