Instacart will stop using artificial intelligence to experiment with product pricing after a report showed that customers on the platform were paying different prices for the same items.
The report, published this month by Consumer Reports and Groundwork Collaborative, found that Instacart sometimes offered as many as five different prices for the same item at the same store and on the same day.
In a blog post Monday, Instacart said it was ending the practice effective immediately.
“We understand that the tests we ran with a small number of retail partners that resulted in different prices for the same item at the same store missed the mark for some customers,” the company said. “At a time when families are working exceptionally hard to stretch every grocery dollar, those tests raised concerns.”
Shoppers purchasing the same items from the same store on the same day will now see identical prices, the blog post said.
Instacart’s retail partners will still set product prices and may charge different prices across stores.
The report, which followed more than 400 shoppers in four cities, found that the average difference between the highest and lowest prices for the same item was 13%. Some participants in the study saw prices that were 23% higher than those offered to other shoppers.
At a Safeway supermarket in Washington, D.C., a dozen Lucerne eggs sold for $3.99, $4.28, $4.59, $4.69 and $4.79 on Instacart, depending on the shopper, the study showed.
At a Safeway in Seattle, a box of 10 Clif Chocolate Chip Energy bars sold for $19.43, $19.99 and $21.99 on Instacart.
The study found that an individual shopper on Instacart could theoretically spend up to $1,200 more on groceries in one year if they had to deal with the price differences observed in the pricing experiments.
The price experimentation was part of a program that Instacart advertised to retailers as a way to maximize revenue.
Instacart probably began adjusting prices in 2022, when the platform acquired the artificial intelligence company Eversight, whose software powers the experiments.
Instacart claimed that the Eversight experimentation would be negligible to consumers but could increase store revenue by up to 3%.
“Advances in AI enable experiments to be automatically designed, deployed, and evaluated, making it possible to rapidly test and analyze millions of price permutations across your physical and digital store network,” Instacart marketing materials said online.
The company said the price chranges were not dynamic pricing, the practice used by airlines and ride-hailing services to charge more when demand surges.
The price changes also were not based on shoppers’ personal information such as income, the company said.
“American grocery shoppers aren’t guinea pigs, and they should be able to expect a fair price when they’re shopping,” Lindsey Owens, executive director of Groundwork Collaborative, said in an interview this month.
Shares of Instacart fell 2% on Monday, closing at $45.02.
