Source: Instacart; Eversight

Will Instacart’s new acquisition change pricing and promo strategies for retailers and CPGs?

Instacart yesterday said that it has acquired Eversight, an artificial intelligence (AI) supported pricing and promotions platform for consumer packaged goods brands and retailers.

Eversight, which was founded in 2013, has created a platform that enables CPG brands and retailers to test customized pricing and promotions on an individualized basis with consumers at scale. 

The use of AI enables the automation of a process that had been previously done manually and at a great time cost. Eversight’s technology for CPG brands takes real-time custom insights and turns them into targeted promotions that drive purchases. Retailers using the tech are able to run “micro price point experiments” across their ranks of customers.

Instacart believes that the addition of the technology will provide an opportunity for its partners to transform their pricing and promotional strategies.

“CPG brands and retailers will have access to new individualized and customized pricing tools and dynamic insights via Instacart that connect the dots between online and offline behavior to improve sales and growth, along with customers’ experiences, no matter how they choose to shop,” according to a company release. “This creates a flywheel effect in which goods are priced at the sweet spot that drives more sales and growth for CPGs and retailers — all while unlocking even better promotions and pricing for customers.”

Fidji Simo, CEO of Instacart, said that the technology will be a welcomed addition for consumers at a time of high inflation.

“Giving everyone access to the food they love is core to Instacart’s mission, and when it comes to grocery shopping, we know that every dollar matters,” said Ms. Simo. “With higher inflation and the average cost of groceries up, we’re taking even more steps to make food and daily essentials more affordable.”

Instacart plans to incorporate Eversight’s CPG product into its Instacart Ads suite to provide brands with measurable ad opportunities and insights. The retail tech will become part of the enterprise-grade solutions offered on the Instacart Platform through the company’s Carrot Insights data dashboard.  

“It’s critical that we’re delivering the right promotions to the right consumers. Eversight’s real-world, real-time insights help us find the price point or promotion that resonates with our consumers and leads to a purchase,” said Lynn Hemans, VP consumer intelligence & analytics for The Hershey Company.

BrainTrust

"Given the pricing pressures caused by inflation, this is a perfect time to introduce AI-driven pricing technology to retailers and CPG brands."

David Naumann

Marketing Strategy Lead - Retail, Travel & Distribution, Verizon


Discussion Questions

DISCUSSION QUESTIONS: What impact will Eversight’s technology have on the pricing and promotional practices of retailers and CPG brands on the Instacart platform? What will it mean for consumers?

Poll

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Gene Detroyer
Noble Member
1 year ago

Eversight is a fascinating if expensive and complex technology. One hopes Instacart’s idea is to provide the technology to its smaller partners on the platform at an affordable cost. I imagine the big guys are already using Eversight or an alternative.

Paula Rosenblum
Noble Member
1 year ago

I suppose the real question is, will Instacart end up in the grocery business and cut out the Publixes, Costcos, etc. of the world? Why should I pay a premium for Publix product when these guys could compete on their own? Truth be told, that’s what Kroger is trying to do. There are no stores here in Florida, but they do delivery in “refrigerated trucks” – which is actually a bigger deal than it sounds like.

Richard Hernandez
Active Member
Reply to  Paula Rosenblum
1 year ago

This. With this large of an investment, you almost have no choice but to dive into the deep end of the pool. I am curious to see how this plays out in the future.

Tara Kirkpatrick
1 year ago

Personalization is a win-win for the consumer and the business, and this acquisition takes it to a new depth. Long term, people are going to get tired of, and perhaps more concerned with, their data being so many different places in exchange for deals, so the opportunity to consolidate shopping activity under Instacart to qualify for deals will become even more attractive over time.

In the short term, CPG brands and retailers are now going to be able to sell more effectively and therefore appreciate being on Instacart, instead of wanting to get away from the aggregator to build their own platform. Consumer engagement with Instacart is also likely to increase, which is what we always see for mobile engagement when an app develops “personalized experience.” Instacart just made the experience on its app more valuable than if the consumer were to download individual retailer and brand apps for a bunch of different loyalty programs.

David Spear
Active Member
1 year ago

If Instacart can deliver tangible insights that help CPGs sell more product at efficient price points, then CPGs and Retailers ought to be very happy about this move. Additionally, I think it’s a great move by Instacart. Complementing existing services with differentiated AI-based insights will make Instacart’s value prop even stronger.

David Naumann
Active Member
1 year ago

Given the pricing pressures caused by inflation, this is a perfect time to introduce AI-driven pricing technology to retailers and CPG brands. If there is not a big upcharge for this technology, it will give retailers a convenient tool to test the price elasticity of consumers.

Melissa Minkow
Active Member
1 year ago

This is a fantastic move. I’ve been waiting for personalized pricing in grocery. Hopefully this drives others to adopt it as well.

James Tenser
Active Member
1 year ago

Instacart has declared its commitment to Retail Media, and there is a tight linkage to personalized offers, so it needed to build or buy a capability like Eversight.

It’s not crystal clear to me what this development might mean for retailers’ pricing autonomy, however. Personalized offers are already a core component of shopper loyalty programs, even among mid-tier and regional grocers.

Eversight’s tech is gee-whiz cool, but the success of this latest move will come down to the incremental ad revenues for participating retailers who allow their customer relationships to be intermediated by Instacart.

Anil Patel
Member
1 year ago

Using AI in establishing a promotion strategy can reveal lucrative results for retailers. However, using this technology to determine and modulate the pricing isn’t the right course of action, I believe it’s unfair to customers.

Retailers must perform trend analysis to identify the gaps, and learn about what customers are “looking for and lacking.” With the right set of information, retailers can select the most suitable retail channels, optimize the inventory levels, as well as cross-sell and up-sell.