AI-priced groceries: Instacart's secret experiments inflate your food bill
By isabelle // 2025-12-10
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  • Instacart secretly charges different customers different prices for identical groceries.
  • Prices for the same items can vary by up to 23% in hidden AI-driven tests.
  • The practice occurs at major retailers, raising serious transparency concerns.
  • This could cost a family of four roughly $1,200 extra per year.
  • Experts warn it could evolve into personalized "surveillance pricing."
If you've used Instacart to order groceries recently, you likely assumed the price you saw was the same as what any other shopper would pay. However, a groundbreaking new investigation reveals that assumption is dangerously wrong. In a covert practice enabled by artificial intelligence, Instacart is conducting widespread pricing experiments that charge different customers wildly different prices for the exact same products from the same stores, potentially costing families hundreds of dollars more each year. The investigation, conducted by Consumer Reports and the Groundwork Collaborative, found that about 75% of products checked on Instacart were offered at varying prices. These discrepancies weren't trivial. For identical items, prices differed by as much as 23%, or up to $2.56 per product. When applied to a full cart of groceries, the total cost for the same basket from a single store could swing by roughly $10 in a single shopping trip.

The scope of secret testing

These tests are not happening in a vacuum. They were observed at some of the nation's largest grocery retailers, including Albertsons, Costco, Kroger, Safeway, Target, and Sprouts Farmers Market. Instacart confirmed the experiments to investigators, stating they involve a "subset of only 10 retail partners." However, the probe found evidence of this algorithmic pricing at Target, a retailer that told investigators it has "no business relationship with Instacart." This contradiction raises serious questions about transparency and control. Instacart markets this technology as a boon for retailers. In corporate materials, it calls the tool "smart rounding," a machine-learning system designed to "improve price perception and drive incremental sales." The company claims it can boost grocery store sales by 1 to 3 percent and increase profit margins by 2 to 5 percent. This drive for profit comes at a direct cost to consumers, especially as food prices remain near historic highs.

From dynamic pricing to surveillance

While charging different prices is not new for airlines or hotels, applying these tactics to essential goods like food strikes many as fundamentally unfair. The investigation found that 72% of Instacart users oppose the practice. Experts warn this is just the beginning. The fusion of AI pricing with vast troves of personal consumer data could evolve into "surveillance pricing," where your shopping history, demographics, and behavior are used to set a personalized—and maximized—price. "All of us, without our knowledge, are being conscripted in this enormous and growing social experiment," said Len Sherman, an adjunct professor at Columbia Business School. He notes that every consumer step is analyzed so that "everything we’ve ever done is going to factor into the price we see." Instacart denies using personal data for these price tests, stating customers are randomly grouped. However, the company holds patents that explicitly reference using demographic and behavioral data to tailor prices and group customers into "subpopulations." This gap between public assurances and patented capabilities is alarming. The financial impact on families is substantial. Based on typical grocery spending, the observed price variations could translate to an annual cost swing of about $1,200 for a family of four. In an era of strained household budgets, this hidden algorithmic tug on the wallet is a significant burden. Regulators are taking note, but action is slow. The Federal Trade Commission has been studying these practices, and states like New York have passed laws requiring disclosures on algorithmically set prices. However, the technology continues to outpace the law. This revelation is more than a consumer alert; it's a lesson in how rapidly emerging technologies can be deployed to quietly extract wealth from everyday people. When the cost of a carton of eggs becomes a variable in a corporate AI experiment, it signals a disturbing shift away from fair and transparent markets. The grocery bill has always been a measure of a family's budget, but now it risks becoming a scorecard of how effectively a hidden algorithm has profiled and priced them. Sources for this article include: TheNationalPulse.com ConsumerReports.org CNBC.com
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