Core Viewpoint - Instacart has decided to discontinue the use of an AI-powered price testing program for retailers, following an investigation that revealed significant price discrepancies for groceries purchased through its platform [1][2][3]. Group 1: Pricing Policy Changes - Effective immediately, retailers are no longer allowed to use Eversight technology for price testing on Instacart, which previously led to different prices for the same item at the same store [2]. - The company emphasized that now, customers shopping for the same items at the same time from the same store will see identical prices, addressing customer concerns about pricing inconsistencies [3][7]. Group 2: Investigation and Regulatory Scrutiny - The decision to end price testing comes after a Consumer Reports and Groundwork Collaborative investigation found that algorithmic pricing could result in price differences of up to 23% for the same items [3]. - Instacart is under scrutiny from lawmakers and the Federal Trade Commission (FTC) regarding its pricing practices, with Rep. Angie Craig demanding answers and the FTC sending a civil investigative demand [5][6]. Group 3: Trust and Customer Relations - The company aims to regain customer trust by clarifying that it does not allow price testing based on supply and demand, personal data, demographics, or individual shopping behavior [7]. - Instacart stated that customers should not have to second-guess the prices they see, reinforcing its commitment to transparency [7]. Group 4: Market Reaction - Following the announcement, Instacart's shares fell approximately 2% during mid-day trading but have nearly recovered from a previous 6% decline related to the price testing study [8].
Instacart scraps AI pricing tests after backlash over grocery price swings