Grocery e-commerce has been a tough nut for grocers to crack as they look to retain price-sensitive omnichannel customers while also making sure online orders don’t dilute their margins.
The grocery industry has grappled with this conundrum in recent years, and now the newly announced bid by DoorDash to acquire Instacart has added yet another wrinkle to the conversation over how to make grocery e-commerce profitable for retailers and affordable for customers.
Industry experts, antitrust lawyers and advocacy groups for workers and consumers have mixed thoughts on whether the DoorDash-Instacart marriage would ultimately raise or lower prices for online grocery shoppers.
Among the groups pushing back against the proposed deal is the United Food and Commercial Workers International Union, which also came out swinging against the ultimately unsuccessful effort by Kroger and Albertsons to combine.
“With billions of consumer data points and more power in the market, the squeeze will be on for families looking to put food on the table, especially for homebound shoppers who have virtually no other option,” UFCW International President Milton Jones said in a Nov. 2 statement, calling the deal “a nightmare for shoppers and workers alike.”
The merger could also run into opposition from antitrust regulators, antitrust attorneys said.
“Because it threatens to further reduce choice on both sides of the U.S. food home-delivery services market, the deal portends downward pressure on margins for food sellers and upward pressure on costs for buyers,” Barry Barnett, a partner who handles antitrust cases at law firm Susman Godfrey, wrote in an email.
Instacart believes that combining forces with DoorDash would benefit the grocery industry and shoppers alike by bringing down costs, Ryan Hamburger, the company’s chief commercial officer, said in an interview.
“We feel very deeply that this combined ecosystem will allow us to further scale the investments in the technology and lower that cost to serve on the delivery side through greater efficiencies [and] greater scale. … That’s going to be a win for all of us, and that can only really happen if and when we combine forces with DoorDash,” Hamburger said.
Hamburger noted that DoorDash and Instacart would be able to reinvest cost savings they gain into lowering fees for retailers and consumers.
DoorDash CEO Tony Xu echoed that message during his company’s earnings call on Nov. 4, saying that the deal “will enable faster delivery. It will enable more affordable prices, which in turn will generate more sales for every grocer and retailer [partner].”
Industry experts agreed that the scale DoorDash and Instacart would get from merging could benefit the grocery industry.
The proposed combination “reflects an online grocery market that is becoming far more competitive and cost intensive,” Neil Saunders, managing director of GlobalData, wrote in an email. “Against those two dynamics, scale is now a prerequisite for success.”
Recent pricing moves by DoorDash and Instacart
Instacart has already been grappling publicly with e-commerce profitability and affordability. For more than a year, Instacart has advocated for price parity — matching online prices with those in stores — in a move the company said helps grocers retain valuable omnichannel shoppers.
Chris Rogers, who became Instacart’s CEO last year, said during the Groceryshop conference this year that the company’s data shows that retailers that adopt price parity see their online sales grow 10 percentage points faster than those that mark up their products.
Similarly, DoorDash also discusses price parity with retailers, Mike Goldblatt, the company’s vice president of grocery and retail partnerships, said in an interview at Groceryshop, noting that affordability is a key concern for online shoppers right now.
The proposed combination of Instacart and DoorDash, though, comes at a time when legislators and regulators are paying closer attention to concerns over dynamic pricing and whether consumers are dealing with unfair pricing practices when grocery shopping.
At the end of 2025, Instacart found itself in hot water over a controversial price test following an investigation by Consumer Reports and Groundwork Collaborative that found grocery prices could differ by as much as 23% between customers on the e-commerce platform. Shortly after that report was issued, the company ended the price testing program, saying “tests we ran with a small number of retail partners that resulted in different prices for the same item at the same store missed the mark for some customers.”
DoorDash and Instacart are among the companies included in the Federal Trade Commission’s recent inquiry into algorithmic pricing and pay practices. The probe follows recent legislative efforts to restrict how companies can use consumer data to set prices.
The changing tide of e-commerce
The proposed deal comes at a time when e-commerce sales have been a growth driver in food retail, while in-store growth has slowed, Bobby Gibbs, a partner at Oliver Wyman, said in emailed comments.
“[F]inding ways to drive cost out through scale is very appealing. However, we’ve seen that just scaling to the point of network density isn’t enough to close the profitability gap of online and in-store commerce,” Gibbs said.
E-commerce memberships could help close that gap, Gibbs said, noting that the most mature e-commerce offerings link to memberships. When announcing their deal, Instacart and DoorDash said that subscribers of their DashPass and Instacart+ programs would pay one membership fee instead of two.
While opponents of the deal have raised concerns that a combined DoorDash-Instacart would limit choices for consumers, supporters have said the scale gained from the deal would better help them compete against Amazon and Walmart.
Saunders said that the deal is unlikely to result in higher costs for consumers.
“A rise in fees, other than for general inflation, is not particularly likely given the stiff competition from the growth of Walmart and Amazon in grocery … DoorDash is competing with two of the biggest and most accomplished ecommerce players in the world — Amazon and Walmart — so it cannot afford to deteriorate service or do anything to alienate shoppers,” he said.
Lower delivery fees could encourage more frequent orders, which would then improve delivery economics, Carlos Castelán, a consultant at technology and consulting platform Catalant, said in emailed comments.
“The question is how much of those savings gets passed along, particularly as consolidation could reduce competition,” Castelán said. “Ultimately, I think the deal could benefit both grocers and consumers, but pricing and execution will determine whether that happens.”
Hamburger said that Instacart and DoorDash are competing against Walmart and Amazon for shoppers’ online dollars — not against other retailers.
“If you leave Wegmans.com, it’s not because you’re overwhelmingly coming to Instacart or DoorDash. [It’s] because you’re overwhelmingly going to Amazon or Walmart, and it gets back to consumers starting to choose on price and affordability,” Hamburger said.
Data released by Brick Meets Click in June found that Walmart and Amazon continue to grow their e-grocery market share, with the former approaching a 40% share of total e-grocery sales in the U.S.
“What we're trying to do is create that ecosystem for our retailers to really leave no doubt to the end consumer as to why they are shopping with that retailer,” Hamburger said.
Sam Silverstein contributed reporting.
