America's favorite grocery ordering and delivery app came under pressure earlier this month after a consumer advocacy investigation raised concerns about its pricing practices and transparency.
America's favorite grocery ordering and delivery app came under pressure earlier this month after it was found to have engaged in numerous unlawful tactics that harmed shoppers and raised the cost of grocery shopping for Americans.
Instacart said effective immediately, it is ending all item price tests on its platform, and will not charge different prices for the same items.
Instacart agreed to pay $60 million to settle a Federal Trade Commission lawsuit that alleged the company engaged in deceptive tactics.
Instacart will pay $60 million in refunds to settle allegations by the U.S. Federal Trade Commission that it deceived consumers with false advertising. The federal agency alleged Instacart misled consumers with unlawful tactics, causing them to pay higher fees while also denying refunds.
The US Federal Trade Commission (FTC) has issued a civil investigative demand to Instacart (NASDAQ:CART) for information on its Eversight tool, which allows retailers to test price changes through A/B experiments, the company said. The move comes after reports last fall, including by Consumer Reports, found that identical grocery baskets often cost an average of 7% more online, potentially adding about $1,200 annually to a typical family of four's grocery bills.
Maplebear stock was dropping following a report that the FTC has sent Instacart a civil investigative demand over its use of AI-set pricing.
According to Reuters, Instacart is currently getting the regulatory equivalent of a throat-clearing from the FTC, which has sent the grocery delivery platform a civil investigative demand regarding its AI-powered pricing tool, Eversight. Put another way, the agency wants to know why some people are paying significantly more for their organic granola than others.
Instacart shares plunge 11% on report that FTC is probing company over AI pricing tool
The grocery delivery service Instacart is using artificial intelligence to experiment with prices and charge some shoppers more than others for the same items, a new study found.
Instacart's AI-pricing experiments can charge customers up to 23% more for identical products, potentially costing families $1,200 extra annually through hidden markups.
The grocery-delivery company's stock was down in morning trading after a report said it displayed several different prices for users who added the same item from the same store at the same time.