TL;DR
Instacart and DoorDash want grocers to price online at shelf parity to fix delivery affordability, which asks a 2.1% margin business to eat the commissions while the platforms' fees stay put. Grocers deliver through their own apps, often without an item markup or delivery fee, so the affordability problem is the marketplaces, not delivery. It's marketplace misdirection, and it's Stage 4 of the Marketplace Dependence Curve announcing itself.
Rents in my city rose more than 25% last year, the steepest climb in the country. A one-bedroom in San Francisco now goes for $4,000 a month. The reason is not a mystery: AI hiring pulled high earners back into the city, and the people collecting the rent call it supply and demand.
This month at Groceryshop in Las Vegas, two companies headquartered here told a room of grocery executives that online grocery has become unaffordable and that grocery pricing is the reason.
Same industry, same move, different bill.
The diagnosis was right. The prescription was not.
Instacart CEO Chris Rogers told the Groceryshop audience that affordability is the number one reason shoppers churn off online grocery and the biggest barrier to adoption.1 Every operator in that room already knew it.
Then he named the remedy. Instacart is lobbying the grocers it works with to price online at shelf parity, or only slightly above. Rogers acknowledged those conversations have been difficult, and Instacart says 90% of U.S. shoppers now have access to a parity grocer on its platform.2
DoorDash is pressing the same point. Its VP of grocery and retail partnerships confirmed the company continues to push parity with its grocer partners.3