According to Reuters, Instacart is currently facing scrutiny from the FTC. The agency has sent the grocery delivery platform a civil investigative demand regarding its AI-powered pricing tool, Eversight. In simpler terms, the FTC wants to understand why some people are paying substantially more for the same items, like organic granola, than others.
This issue emerged after a study revealed that shoppers are seeing significantly different prices for identical groceries from the same stores. In some cases, prices were up to 23% higher. Instacart states these price tests were randomized and not tied to an algorithm that targets customers based on their browsing history. However, for people already anxious about affording basic groceries, that distinction may not feel very meaningful.
Dynamic pricing itself is not new or necessarily wrong. As Harvard Business School notes, it is a common strategy for digital platforms to stay competitive. Airlines, hotels, and companies like Uber use it regularly. Proponents argue it helps balance supply and demand, maximizes profitability, and can create efficient markets.
But there is a perceived difference between surge pricing for a ride home and variable pricing for essential groceries, as food is not an optional purchase. While the FTC investigation does not prove any wrongdoing, it is unsurprising that the agency is asking questions. The FTC has previously examined data-driven pricing strategies used by other companies. In an economy where many consumers feel financially squeezed, AI-driven price testing on everyday kitchen essentials was bound to attract regulatory attention.