Firewalls Don't Stop Dragons Podcast Surveillance Pricing
Mar 16, 2026
Eric Gardner, former grocery pricing consultant turned business reporter, and Justin Brookman, Consumer Reports marketplace policy director, dig into surveillance pricing on apps like Instacart. They describe how researchers tested price variation, the tech and patents behind targeted experiments, legal and regulatory pushback, and what shoppers can do to spot and respond to hidden price differences.
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Patents Reveal Sophisticated Price Testing Tools
- Instacart claims tests were random but Consumer Reports found patents (Eversight) describing price testing using past purchases and demographics.
- The Eversight documentation shows segmentation criteria including past purchasing and demographic data that could explain personalization.
Customer Surplus Drives Personalized Price Tests
- Customer surplus describes money companies leave on the table when they undercharge buyers who would pay more, and algorithms aim to capture that.
- Personalized pricing uses elasticity tests to raise each buyer's price to near their willingness to pay, reducing serendipitous discounts.
Pandemic Opened Door For More Dynamic Pricing
- The pandemic accelerated retailer willingness to raise prices and consumer migration to apps, creating fertile ground for algorithmic pricing.
- Eric observed industry change during COVID where retailers realized they could raise prices with fewer immediate consequences.