Jody Godoy
Dec 22 (Reuters) – Online retail platform Instacart said on Monday it would end a price test that resulted in different shoppers seeing different grocery prices after criticism of its artificial intelligence-driven pricing tool.
The company faced an outcry after a study by Consumer Reports and two other nonprofits revealed that some shoppers saw prices that were 23% higher than others browsing the same groceries from the same store at the same time.
Reuters reported last week that the U.S. Federal Trade Commission had raised questions about Instacart’s Eversight pricing tool, which allows retailers to conduct random price tests to gauge shopper reactions to higher or lower prices. Instacart previously said on its website that shoppers were unaware of the experiments.
Instacart acknowledged its displeasure with the practice in a blog post on Monday and said it would end price testing for all items on the platform immediately.
“At a time when families are working incredibly hard to save every penny, these tests raise concerns and have some people questioning the prices they see on Instacart. That’s not good,” the company said.
Instacart’s news comes about two weeks after research showed the average cost of the same shopping list at the same store varied by 7%.
These random tests join the list of AI-driven pricing strategies that have prompted public outcry and calls for regulation, as well as demand-based dynamic pricing and personalized pricing based on shopper data.
(Reporting by Jody Godoy in New York; Editing by Kirsten Donovan)