After a report showed that Instacart charges some customers up to 23 percent more for the same item, Lindsay Owens, executive director of the Groundwork Collaborative, urged state attorneys general to investigate the practice.
She said Instacart’s pricing experiments erode fairness and transparency in markets and harm consumers, adding that charging different prices for identical items may violate the law.
“This is why we have laws to safeguard our markets and ensure transparency. And so I really think it should be up to policymakers here to take a close look at this,” Owens said. "Attorneys General should pursue investigations of Instacart and determine whether or not these prices, these pricing experiments may already be illegal under current law."
A recent Consumer Reports investigation using 437 volunteer shoppers found that prices on grocery items from major chains could vary by up to 23 percent depending on the customer. These differences could mean some shoppers pay between 7 cents and $2.56 more per item than others.
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At issue is the potential for retailers to adopt “surveillance pricing,” which uses personal data to set individualized prices. Instacart, however, told Scripps News: “These tests are not dynamic pricing — prices never change in real time, including in response to supply and demand. The tests are never based on personal or behavioral characteristics — they are completely randomized.”
Owens noted the report determined that pricing differences appeared to be random.
“You buy a whole basket, you go to the grocery store once or twice a week all year long. So even these small price hikes really can add up for families at a time when groceries are already unaffordable and prices are so high for food in this country,” she said.
Owens said Instacart did not dispute Consumer Reports’ findings but expressed a differing opinion on whether the practice is problematic.
“Experiments like these, particularly ones being run without our knowledge, are incredibly deceptive,” Owens said. “And on Instacart’s website, when they talk about the underlying technology that powers these experiments, they suggest that secrecy — the fact that we don’t know we’re being experimented upon — is a feature, not a bug, of their approach. But I do think this type of secret exploitation is not just bad for shoppers on Instacart, it’s bad for all of us.”
Based on how much Instacart says the typical household of four spends on groceries, Consumer Reports estimated the price variations could amount to a cost swing of about $1,200 per year.
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In 2022, Instacart began using Eversight, a platform for “continuous revenue optimization.” Instacart says its short-term, randomized pricing tests mean some shoppers see slightly lower prices and others slightly higher, helping retail partners understand preferences and identify categories where they should invest in lower prices.
The company said it uses a “machine learning–driven tool that helps retailers improve price perception and drive incremental sales for dozens of early-adopting retailers leveraging the product.” The tool has reportedly generated millions of dollars in additional revenue for partner stores.
Instacart maintains the price differences are “negligible.”
