Study Reveals Instacart’s AI Raises Prices by Up to 20%

Recent findings reveal that Instacart, a leading online grocery delivery service, has been using artificial intelligence (AI) to adjust prices for the same items, sometimes resulting in increases of up to 20%. This was highlighted in a joint investigation by Consumer Reports and Groundwork Collaborative, which examined pricing practices on the platform.

Key Findings from the Investigation

The report specifically notes that Instacart displayed varying prices for common household staples across various prominent retailers, including Albertsons, Costco, Kroger, Safeway, and Target. Shoppers, according to the study, are unknowingly involved in widespread AI-driven pricing experiments.

Impact on Consumers

According to the report, these corporate practices are raising costs for American families. The lack of price transparency makes comparison shopping difficult, hindering consumers from effectively budgeting their grocery expenses. The organizations involved stated:

• “When prices are no longer transparent, shoppers can’t comparison-shop.”
• “When prices are no longer predictable, shoppers can’t properly budget.”

The study indicates that Instacart’s AI technology assesses customer price sensitivity, which determines how much retailers can charge before customers decide against a purchase. This differs from dynamic pricing, where adjustments are made instantly based on supply and demand.

Evidence from Internal Communication

Further evidence came from an email exchanged between Instacart and Costco, which was inadvertently sent to Consumer Reports. While Costco did not respond to comments, the email confirmed the AI’s pricing approach.

Context of Rising Grocery Prices

These findings emerge as many Americans face rising grocery costs influenced by tariffs, immigration policies, and extreme weather impacting food supply chains. Instacart’s dominance in the e-commerce grocery sector is notable, with over 250 million orders placed in the first three quarters of 2025.

Study Methodology

The investigation utilized 437 participants who purchased identical items using Instacart, comparing them with in-store prices. The results revealed that all individuals experienced variations in prices due to algorithmic experiments.

Price Variations Observed

Specific examples illustrate the extent of these price fluctuations:

• A dozen eggs in a Safeway location in Washington, DC, was priced between $3.99 and $4.79.
• A box of Safeway Corn Flakes showed a 23% price disparity, ranging from $2.99 to $3.69.

Overall, customers using Instacart could see an additional cost of approximately $1,200 annually, attributed to the AI-driven pricing structure employed by the platform.

Instacart’s Response

In a statement regarding the findings, Instacart noted that each retailer’s pricing policy is disclosed on their platform, allowing customers to review differences between online and in-store prices. The company explained that retail partners implement these pricing strategies to enhance understanding of consumer preferences, and that the tests conducted are limited and short-term.

As grocery prices continue to escalate, the implications of AI pricing strategies on consumer behavior remain a crucial topic of discussion.