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Welcome Back to TWISM’s Autopsy Series!
In this series, we examine the biggest actual marketing deaths worldwide. While others made expensive mistakes, you, along with 70,000+ professional TWISM readers, are learning from their failures for free.
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🔬 The Main Autopsy: Instacart’s “Free Delivery” + AI Price Tests That Triggered a Trust Organ Failure
Patient Details
Brand: Maplebear Inc. (Instacart)
Campaign: “Free delivery” promotions + Instacart+ free-trial enrollment flows.
Budget: $60 million in consumer refunds.
Cause of Death: “Free” claims that allegedly weren’t free, plus opaque pricing experiments that looked like stealth gouging.
Time of Death: December 18, 2025 (FTC settlement announced).
What They Intended
Instacart appears to have aimed to reduce purchase friction with “free delivery” messaging while growing its subscription base through trials. The FTC argued that those offers and flows misled consumers about fees and trial-to-paid conversion mechanics.
Separately, Instacart and retail partners appear to have used item-level pricing tests to learn what shoppers would pay. Instacart framed these as tests, not “dynamic” or “surveillance” pricing.
What Actually Happened
Regulators alleged Instacart advertised “free delivery” while charging other mandatory fees, making the “free” claim misleading.
The FTC alleged that free trials were not clearly disclosed as auto-converting into paid subscriptions and that refund representations were misleading.
A joint investigation reported that Instacart showed different prices to different shoppers for the same items at the same store at the same time, with differences reaching up to 23% in some cases.
The pricing report went viral, drew lawmaker scrutiny, and triggered an FTC inquiry into the price-testing tool.
Instacart then announced it was ending all item price tests “effective immediately.”
The Numbers
$60,000,000 in consumer refunds under the FTC settlement.
FTC alleged “service fees” could add up to 15% to an order (as described in coverage of the complaint).
The investigation reported that nearly three-quarters of grocery items tested showed multiple prices.
Reported item-level price differences averaged 13% with some reaching 23%.
Instacart shares dropped after the pricing report and subsequent developments.
Instacart publicly committed that shoppers at the same store, same time will now see the same prices.
Timeline of Destruction
Dec 9, 2025: Investigation alleges price tests produced up to 23% differences and widespread multi-price listings.
Dec 18, 2025: FTC announces $60M settlement over alleged deceptive tactics tied to “free delivery,” refunds, and subscription enrollment.
Dec 22, 2025: Instacart announces it will end item price tests immediately.
Dec 22–24, 2025: Broader pickup frames it as a trust and transparency crisis.
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🧬 Failure DNA Analysis
The Root Cause: “If it’s technically disclosed, it’s ethically fine”
This is a classic case of legalistic thinking colliding with trust physics: consumers don’t evaluate you like a compliance team. They evaluate you like a human with a grocery budget and a short fuse.
Cognitive Bias #1: Optimism bias
Teams can underestimate the likelihood that “free” messaging will be interpreted literally and shared angrily when it isn’t.
Cognitive Bias #2: Status quo bias (and its best friend, loss aversion)
Once “free delivery” language and conversion flows are working “well enough,” organizations resist changing them, especially if changes threaten growth metrics.
Warning Signs They Ignored:
“Free” claims paired with mandatory fees are a perennial regulator magnet.
Trial-to-paid “negative option” designs routinely trigger enforcement.
Secret pricing experiments resemble “surveillance pricing” to the public, even if you swear they aren’t.
When watchdogs can reproduce inconsistencies with hundreds of shoppers, it’s not a “small test” anymore; it’s a headline.
Why Smart People Made This Dumb Decision:
Dashboards reward conversion and ARPU, while trust degradation shows up later as regulatory attention, churn, and reputational scar tissue, often after the quarter closes.
The FTC framing explicitly tied the alleged tactics to consumers paying more and being harmed.
🎭 Myth Busted: “If we call it ‘a test,’ customers will accept it”
The Myth: Experiments are fine as long as they’re not personalized and you can defend them as standard retail practice.
The Reality: Customers experience unexplained price differences as unfairness, not experimentation, especially for groceries. The investigation emphasized same-item, same-store, same-time differences up to 23%, which is reputational napalm.
Data Points:
Up to 23% higher prices for identical items in reported tests.
Nearly 75% of items tested showed multiple prices.
Instacart ended the program and promised same-store/same-time price consistency.
Why This Myth Persists:
Because internal language (“A/B test”) sounds clinical and harmless. External language (“Why did my neighbor pay less?”) sounds like betrayal.
What to Do Instead:
Run pricing tests only with explicit consumer disclosure, guardrails, and opt-outs, or keep tests at the retailer/location level where consumers already expect variation. Instacart itself emphasized that retailers can still vary prices by location even as item tests ended.
🛡️ Failure Prevention Toolkit: The “No Illusory Freebies” Checklist
Before launching any “free” offer, subscription trial, or pricing experiment:
✓ Claim Integrity
If there’s a mandatory fee, don’t call it “free.” Use “$0 delivery fee” only when the total delivery cost is actually $0.
Put the real total cost in the first screen where “free” appears, not at checkout.
✓ Trial-to-Paid Surgery
Auto-renew terms must be unmissable, not buried.
Cancellation and refund paths must be as easy as signup (no scavenger hunts).
✓ Experiment Disclosure
If users are part of a pricing test, tell them plainly.
Add a “Why am I seeing this price?” explainer in-product (and keep it short enough that humans read it).
✓ Trust Monitoring
Watch TikTok/Reddit sentiment around “pricing” and “fees” like it’s a heart monitor, because it is.
Pre-brief customer support with scripts and receipts before tests roll out.
Red Flags to Watch For:
“Free” + mandatory fees anywhere in the funnel.
Auto-renew flows that rely on confusion, not value.
Price differences users can reproduce side-by-side in seconds.
“It’s not dynamic pricing” statements that still don’t answer “why did I pay more?”
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That’s all for today. Thanks for reading. Now…
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