Instacart’s AI-driven pricing tools often charge shoppers different prices for the same products from the same store, according to a new study released Tuesday.
The research, by Groundwork Collaborative, Consumer Reports, and More Perfect Union, involved 437 shoppers in four cities adding identical items to their carts from major retailers like Target, Costco, and Kroger via the Instacart app. The findings reveal that nearly 75% of the tested items showed price discrepancies.
The investigation revealed that certain grocery items varied in price by up to 23% between different Instacart customers. In an email sent out unintentionally, the company referred to its pricing strategies as “smart rounding.”
The study estimates that the price differences could cost a typical shopper $1,200 annually.
Instacart responded that sellers control prices on its platforms and that only a “small subset” of its retail partners run limited online pricing tests.
The company acquired the AI-powered pricing platform Eversight in 2022, which provides it with the pricing tool. And Instacart is going big on AI: It recently partnered with OpenAI to allow users to order and pay for products via ChatGPT.
The report adds to the growing scrutiny by regulators and lawmakers on the use of AI pricing algorithms across various industries.
New York State enacted a law in November that requires businesses to disclose the use of personal data for algorithmic pricing. The FTC is studying the issue.