Study: 193 Instacart users across four US cities saw different prices for the same items from the same store at the same time; Instacart says it's running tests
The findings are the latest example of how the notion of a single price is breaking down in the digital age, a trend economists say could be pushing up some prices.
New York TimesBen Casselman
Context & Ripple Effects
Instacart’s pricing model has shifted before: its move toward grocer fees made the platform’s economics more dependent on the retailer side than on delivery fees and markups alone. The reported tests put individualized item pricing at the center of that marketplace relationship.
Users shopping the same store can face different displayed item prices at the same moment, making comparison shopping and confidence in a listed price harder.
Instacart’s tests become a visible product and trust risk, rather than a back-end optimization that customers are unlikely to notice.
Second-order effects
Grocers using Instacart must contend with customer confusion over whether a price reflects the retailer or the platform, while rivals have an incentive to emphasize price consistency.
The reported variation creates a basis for consumer and regulatory scrutiny; related coverage shows that scrutiny extending to the company’s AI pricing tool.
Third-order effects
If digital marketplaces increasingly tailor item prices, price disclosure and auditability could become competitive and regulatory requirements rather than optional consumer-protection features.
The episode points to a broader constraint on personalized item-price experiments: revenue optimization may be limited by customer trust when identical goods no longer carry a readily verifiable common price.
The trend: This is one data point in the shift from a single posted price toward algorithmically managed price realization, with transparency becoming the check on adoption.
Companies like Instacart are using AI and your personal data to “optimize” prices for groceries—and keeping it a secret. They're charging hard-working Americans higher prices for essentials so they can pad their profits. It's just plain wrong.
One of my crankiest Cranky Old Man positions is that people should go to the grocery store and shop for themselves instead of complaining about delivery costs, tipping drivers, and dynamic pricing/price experiments. https://www.nytimes.com/...
@Instacart ... describes here the concept of merchants using their OWN pricing algorithms. Even in this case, the use of pricing algorithms can facilitate coordination in what economists call “algorithmic coordination.” The problem I mentioned above is arguably more pernicious, […
New study shows some @Instacart customers were charged 20 percent more for the SAME product at the SAME store (a Safeway in DC) at the SAME time. Same findings at Targets in Ohio and Minnesota. This study, organized by @Groundwork, focuses on price DISCRIMINATION, which is a [ima…
This article frames price-based A/B testing as a form of predatory economic malfeasance. Should price-based A/B testing be banned for grocery products? And if so, to what other products should that ban apply? [image]
@Groundwork ... Instacart even recently acquired an AI company called Eversight to get better technology to run these experiments on you-and even admits in their marketing materials that one of the biggest benefits of this technology is that you won't notice it. 7/9
@Groundwork ... Instacart charged shoppers different prices for about 75% of the items in the basket-sometimes they charged as much as 23% more for the exact same item. Using Instacart's own estimates, we find that the Instacart tax could cost households as much as $1200 a year. …
@Groundwork ... Companies no longer price according to how much it cost THEM to make something. Instead, they price based on what YOU are willing to pay. An army of pricing advisers-a cross between the Geek Squad & Seal Team Six-is helping them to execute these high-tech pricing …
@Groundwork ... We are in the midst of the largest grocery affordability crisis in a generation. Instacart's pricing tricks are making it worse. So why is this happening? I talked to @bencasselman in the @nytimes about how when it comes to pricing, the ground has shifted under ou…
The greed of tech companies can be astonishing. They will always try to find a way to squeeze more money out of people, even in a time of financial insecurity. Dynamic pricing generally is an evil thing, but dynamic pricing groceries shows how relentlessly greedy they are. [image…
Right now, Instacart is quietly running experiments on millions of us while we shop for groceries online. They are trying to figure out exactly how much they can get away with charging you for breakfast cereal, lunch meat, pasta, and everything in between. How do I know? 1/9 [ima…
New research found that Instacart is charging shoppers different prices — despite ordering the same items from the same store at the same time. — The price differences could amount to an extra $1,200 a year for the average household of four. — Corporate greed is out of contro…
Instacart prices vary by 20% or more depending on the customer, despite buying the same item from the same store at the same time. — Instacart admits that customers are subject to “pricing tests.” — Surveillance pricing is so much more pervasive than we know. — www.nytimes.…