"New research by a consortium of groups including Groundwork Collaborative, Consumer Reports, and More Perfect Union have found evidence of a massive experiment being run on consumers by grocery delivery company Instacart. The researchers' experiments found evidence that Instacart - which calls itself "the largest online grocery marketplace in North America" - has been charging some customers up to 23 percent more than others for the same product at the same location."
"While the cost only varied by a few dollars in the best-case scenarios, the algorithm-tax can add up fast. "A household of four will spend roughly an extra $1,200 per year for groceries on Instacart if they are exposed to the average fluctuations in total basket prices observed in this study," the researchers wrote. The whole thing kicked off in 2022, when Instacart acquired an AI company called Eversight."
Instacart displayed substantial price variation for identical items at the same locations, with some customers charged up to 23 percent more than others. Data from 437 Instacart shoppers across multiple U.S. cities showed prices for the exact same item fluctuating by an average of seven percent at the same time and location. Specific store examples included Safeway and Target, where identical carts produced different totals across shoppers. A household of four could pay roughly an extra $1,200 per year under observed fluctuations. Instacart's 2022 acquisition of Eversight enabled dynamic algorithmic pricing that boosted per-sale profits by two to five percent.
Read at Futurism
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