Instacart is scrapping its price tests after facing huge blowback from customers.
The grocery delivery service announced Monday that it is ending its item price-testing program following an investigative report that found customers were being charged different prices for the same products, even when the items were ordered at the same time. As users have become more aware of encroaching surveillance pricing, public reaction against Instacart has been swift and attracted the attention of regulators.
The backlash was sparked by a report earlier this month from Consumer Reports, Groundwork Collaborative, and More Perfect Union. The investigation found that Instacart charged some customers nearly 25% more than others for the same products bought at the same stores. Those price differences were allegedly tied to the company’s Eversight pricing tool, which Instacart describes as an “AI-powered pricing and promotions platform.”
The report outlined findings from an experiment conducted in September, in which 437 shoppers across several cities added the same items to their Instacart carts from the same stores. On average, shoppers saw a 13% price difference for the same items, with some gaps as high as 23%.
In a press release on Monday, Instacart said retailers will no longer be filtered through the Eversight tool.
“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,” the press release reads. “That’s not okay – especially for a company built on trust, transparency, and affordability.”
Instacart has claimed the price differences stemmed from experiments run in partnership with a small number of retailers, and that prices were randomized rather than based on customers’ demographics or personal information.
“Even though these tests were not dynamic pricing or surveillance pricing – and were never based on supply or demand, personal data, demographics, or individual shopping behavior – we’ve listened carefully to the feedback from our customers, and we understand these tests fell short of their expectations,” the company said.
The move comes just days after some media outlets reported that the Federal Trade Commission has launched a probe into Instacart’s pricing practices.
It also follows the company’s agreement to issue $60 million in refunds to settle separate allegations from the FTC that it engaged in deceptive business practices.
“Instacart misled consumers by advertising free delivery services—and then charging consumers to have groceries delivered—and failing to disclose to consumers that signed up for a free trial that they would be automatically enrolled into its subscription program,” said Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, in a press release.
An Instacart spokesperson told Gizmodo that the company denied any allegations of wrongdoing, adding that it provides “straightforward marketing, transparent pricing and fees, clear terms, easy cancellation, and generous refund policies,” which the company says comply with the law and follow industry norms.
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