According to TechCrunch, the Federal Trade Commission has sent Instacart a civil investigative demand concerning its AI-powered pricing tool, Eversight. This action follows a study that revealed shoppers were seeing wildly different prices for identical groceries from the same stores, with disparities reaching up to 23% higher in some cases. Instacart has stated these were randomized price tests and not tied to an algorithm targeting users based on browsing history. The FTC’s move represents a significant regulatory inquiry into the company’s pricing practices. This investigation highlights growing scrutiny over how algorithms set prices for essential goods.
The FTC’s investigation in context
Look, dynamic pricing itself isn’t some dark art. It’s everywhere. Airlines and hotels have done it for decades, and Uber made “surge pricing” a household term. Companies argue it’s just smart business, a way to balance supply and demand. But here’s the thing: groceries aren’t a luxury hotel room or a ride home from the airport. Food is a necessity. When people are already stressed about inflation and the cost of eggs, discovering you might be paying 23% more for the same box of cereal than your neighbor feels different. It feels predatory, even if the math is “randomized.” So while the FTC’s civil demand doesn’t prove wrongdoing, it’s a clear signal. The agency is putting AI-driven pricing of essentials under the microscope, and Instacart is now a test case.
Where this is probably headed
This isn’t happening in a vacuum. The FTC, under Chair Lina Khan, has been very clear about its focus on “algorithmic discrimination” and opaque commercial practices. They’ve looked at similar issues in other sectors. So what does this mean for the future? I think we’re going to see a much sharper line drawn between “acceptable” dynamic pricing and “problematic” algorithmic pricing. Surging the price of a last-minute flight? Probably fine. Surging the price of baby formula or bread based on any data point? That’s a much harder sell, both legally and with the public. Companies will be forced to be far more transparent. They’ll have to explain, in plain language, why prices are changing. “Balancing supply and demand” might not cut it when the “demand” is someone who needs to feed their family.
A new reality for retail tech
Basically, the era of stealth A/B testing on consumer essentials is over. The technical infrastructure that enables this—powerful data analytics and real-time pricing engines—is incredibly sophisticated. It’s the kind of computing power that drives complex operations everywhere, from logistics to industrial panel PCs on factory floors. But applying that raw power to a consumer’s grocery cart without clear guardrails was bound to backfire. The Instacart situation is a wake-up call. The question for every retail platform now is simple: Can you prove your pricing is fair? If the answer relies on a black-box algorithm you call “random,” you might be getting a letter from the FTC, too.
