Instacart Scraps Variable-Pricing Experiment After Consumer Groups Warned Of Inflated Grocery Bills

Authored byh Tom Ozimek via The Epoch Times (emphasis ours),

Instacart said it is ending a pricing experiment that allowed different customers to see different prices for identical grocery items after consumer advocates said the practice could inflate grocery bills at a time when households are already struggling with high food costs.

In a blog post published on Dec. 22, the company said it would immediately halt all “item price tests” conducted on its platform, acknowledging that the practice fell short of customer expectations at a time when inflation-weary households remain sensitive to grocery bills.

“Our customers have high expectations for Instacart. And for some, we fell short of those expectations,” the company said.

“At a time when families are working exceptionally hard to stretch every grocery dollar, those tests raised concerns, leaving some people questioning the prices they see on Instacart. That’s not okay—especially for a company built on trust, transparency, and affordability.”

The decision means that if two customers shop for the same items, at the same time, from the same store location on Instacart, they will now see the same prices, the company said.

Instacart said retailers will continue to control pricing on the platform, including whether online prices differ from in-store prices or vary by store location. But the company said it will no longer support item-level price testing tools that result in different prices for the same product at the same store.

Consumer Groups Flagged Pricing Risks

The pricing experiments drew public scrutiny earlier this month after a report by Consumer Reports, along with progressive advocacy groups Groundwork Collaborative and More Perfect Union, found that many Instacart shoppers were shown multiple prices for identical items.

The groups conducted four identical Instacart shopping sessions with 437 volunteers across four states, comparing prices for the same 18 to 20 products purchased at the same time. A fifth group purchased the same items in physical stores for comparison.

The analysis found that roughly three-quarters of items were offered at different prices across shoppers, with markups ranging from a few cents to as much as $2.56 per item. In one September test, total cart prices for the same groceries ranged from $114.34 to $123.93, with just 8 percent of shoppers receiving the lowest total.

In one example cited by Groundwork Collaborative, shoppers ordering a dozen Lucerne eggs from a Safeway store in Washington were shown one of five prices—$3.99, $4.28, $4.59, $4.69, or $4.79—despite ordering at the same time from the same store.

“At a time when food price inflation outpaces overall inflation, and Americans report that the price of groceries is their number one cost concern, pricing experiments used by companies like Instacart are making the situation worse,” Groundwork Collaborative wrote.

Consumer Reports cited customer feedback describing the practice as deceptive, saying shoppers were unknowingly subjected to pricing experiments that left them questioning whether they were being overcharged.

“Instacart shoppers we spoke to say they were unaware that they were participants in active Instacart pricing experiments and view the practice as manipulative and unfair,” Consumer Reports wrote.

The company’s variable pricing experiments also drew scrutiny from lawmakers. On Dec. 11, Rep. Angie Craig (D-Minn.), ranking member of the House Committee on Agriculture, sent a letter to Instacart citing the consumer group findings and requesting detailed answers about the company’s pricing practices.

“I am writing to express my deep concern with Instacart’s use of sensitive personal information to inflate grocery bills for families based on their financial situation,” Craig wrote. “The practice of charging my neighbors different prices for the same groceries at the same store is unacceptable, especially when families are being squeezed from all sides.”

Instacart said in its Dec. 22 blog post that the pricing tests, conducted using software from Eversight, were randomized and not based on personal data, shopping history, demographics, or real-time supply and demand.

“These tests were not dynamic pricing or surveillance pricing,” Instacart said, adding that prices were not tailored to individual users.

Earlier this month, Instacart confirmed it had been offering the Eversight pricing tools to a limited number of retail partners since 2023, saying the short-term tests were designed to help retailers understand category-level price sensitivity and were not designed to increase the average markup set by a retail partner.

FTC Settlement Adds to Scrutiny

Instacart’s decision to end the pricing tests comes just days after the company agreed to pay $60 million in consumer refunds to settle a lawsuit brought by the Federal Trade Commission (FTC).

In a Dec. 18 announcement, the FTC said the settlement resolved allegations that Instacart engaged in deceptive practices, including misleading advertising about free delivery, charging undisclosed service fees, and enrolling consumers in paid subscriptions without clear consent.

“Instacart misled consumers by advertising free delivery services—and then charging consumers to have groceries delivered,” Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said in a statement.

The FTC alleged that Instacart advertised “free delivery” on first orders but then charged mandatory service fees that could add up to 15 percent of an order, without clearly disclosing the costs. The agency also accused the company of falsely advertising a “100 percent satisfaction guarantee” while making refunds difficult to obtain.

Under the proposed order, Instacart must stop the alleged practices, clearly disclose fees and subscription terms, and obtain express informed consent from consumers. The company has denied wrongdoing but said the settlement allows it to move forward.

In a statement to The Epoch Times, an Instacart spokesperson said the company’s pricing, marketing, and fee policies are transparent and comply with the law.

“We flatly deny any allegations of wrongdoing by the Federal Trade Commission, and we stand firmly behind the integrity and transparency of our programs,” the statement reads.

Looking ahead, Instacart said it will focus on encouraging more retailers to move toward in-store and online price parity, while clearly displaying each retailer’s pricing policy on its platform.

“Trust is earned through clarity and consistency,” the company said. “Customers should never have to second-guess the prices they’re seeing.”

Mary Prenon contributed to this report.