According to The Verge, Instacart announced on Monday that it is ending its AI-powered pricing tests, which had led to different customers seeing different prices for the same grocery items at the same store. The decision follows a study released just weeks ago by Groundwork Collaborative, Consumer Reports, and More Perfect Union that exposed the practice, drawing scrutiny from lawmakers like Senator Chuck Schumer. Reuters reported the Federal Trade Commission opened an investigation into these tests. Instacart says it will no longer let retailers use the Eversight AI tech it bought in 2022 for such tests, though store-by-store price variations may continue. This news comes on the heels of a separate $60 million settlement Instacart reached with the FTC last week over allegations of deceptive tactics.
The Price You See Depends On Who You Are?
Here’s the thing: dynamic pricing is everywhere, from Uber Surge to airline tickets. But applying it silently to your weekly grocery haul? That feels different. It feels predatory. Instacart insists the tests “were never based on supply or demand, personal data, demographics, or individual shopping behavior.” Okay, but then what were they based on? If it wasn’t those factors, the algorithm was basically picking numbers out of a hat—and that’s arguably worse. It means the price discrimination was random, not “smart,” which undermines the whole point of using AI in the first place. It just looks like a cash grab.
Regulatory Heat Turns Up Fast
You can see why they folded so quickly. When a US Senate Majority Leader calls your practice a “greedy shakedown” and the FTC comes knocking, the writing is on the wall. The Groundwork Collaborative report was the match, but Schumer and the FTC poured gasoline on it. And let’s not forget that $60 million settlement from just last week. The FTC already had Instacart in its sights for “deceptive tactics.” Adding AI-powered price tests to the mix was a spectacularly bad look. It basically handed regulators a roadmap to your next multi-million dollar fine.
A Retreat, Not a Surrender
Don’t mistake this for a full surrender, though. Look at the fine print in their blog post announcement. Retailers “may choose to vary the price of items on a store-by-store basis.” So geographic price differences are still totally fair game. And they’re only ending tests using the specific “Eversight” tech. The door is still cracked open for other forms of variable pricing in the future, once the heat dies down. They’re playing the long game. This is a strategic retreat to fight another day, under a different name or with a different method.
The Trust Tax
Ultimately, this is about trust. Groceries are a foundational expense, not a discretionary luxury. When people feel like they’re being secretly experimented on or gouged at the checkout for essentials, they revolt. Instacart’s statement says they “listened carefully to feedback” and that the tests “missed the mark.” That’s corporate-speak for “we got caught and the backlash was too expensive.” The real cost here isn’t just a paused AI project. It’s a “trust tax.” Every customer who reads this story will now wonder, just for a second, if the price they’re seeing is the real price. And in a competitive market, that’s a very expensive tax indeed.
