Instacart Privacy Policy: A Deep Dive From a Consumer Advocate‘s Perspective

As an avid Instacart user and consumer privacy advocate, I‘ve spent countless hours poring over the company‘s privacy policy, terms of service, and public statements to understand exactly what happens with the trove of personal data that Instacart collects on millions of customers. In this in-depth guide, I‘ll share my findings and insights to help you make sense of Instacart‘s data practices and how they could impact your privacy.

But first, let‘s step back and consider just how much the grocery delivery market that Instacart dominates has grown in recent years. Online grocery sales in the U.S. more than doubled from $28.7 billion in 2019 to $59.5 billion in 2020 as the pandemic drove many consumers to try these services for the first time. Even as pandemic restrictions have eased, many shoppers have continued to embrace the convenience of on-demand grocery delivery.

Instacart in particular has seen explosive growth, with the company reporting a 230% increase in order volume and a 350% increase in revenue in 2020. Today, the company partners with over 600 retailers across more than 5,500 cities in North America, delivering from 55,000+ stores to over 9.6 million active customers.

But Instacart‘s rapid rise has also drawn increasing scrutiny of its privacy practices, as consumer advocates warn that the detailed data the company collects on users‘ purchases and behaviors could be used in invasive or unexpected ways. So let‘s dive into the details of what Instacart knows about you and what the company does with that information.

The Personal Data Instacart Collects

From the moment you create an Instacart account, the company starts gathering data about you. Some of this is information you provide directly, like your name, email address, phone number, delivery address, and payment card details. Instacart needs these basic facts to set up your account and process your transactions.

But the arguably more revealing information is what Instacart collects about your activity on its platform, such as:

  • Every item you‘ve ever added to your cart or purchased, down to the specific brand, size, and price
  • The date, time, and value of each of your orders
  • Your interactions with Instacart‘s website and app, including what pages you browse and what buttons you click
  • Any promotions or discounts you redeem
  • Delivery instructions, gift messages, and other notes you add to your orders
  • Ratings and feedback you provide on the items you purchase and the shoppers who deliver them
  • Your chat conversations with Instacart‘s customer support agents
  • Location data showing the exact GPS coordinates of your delivery address and where you are when using the Instacart app

If you choose to link your loyalty accounts from grocery chains with your Instacart account, the company also gains visibility into your in-store purchases at those retailers, even if you don‘t use Instacart to buy those items.

Instacart states that it uses this data for an array of purposes, from the expected (fulfilling your orders, processing payments, providing customer service) to the more eyebrow-raising (advertising, product improvement, and "other business purposes").

How Instacart Leverages Your Data for Advertising and Personalization

One of the main ways Instacart monetizes the data it collects is by using it to power personalized advertising and product recommendations, both within the Instacart app and on other websites you visit.

Let‘s say you regularly purchase a particular brand of granola on Instacart. The company may use that information to surface ads and special offers for that brand or similar products as you browse the Instacart app. According to the company‘s privacy policy, it may also share your data with the granola brand or the retailer you purchased it from so they can target you with ads on other platforms based on your Instacart activity.

"Customers expect a personalized shopping experience, and we use data in a responsible way to power features that make grocery delivery effortless," an Instacart spokesperson told me via email. "For example, if you regularly buy milk, we may surface that item earlier in your search results. Or if you tend to do your shopping on weekday mornings, we may send our Deals email then."

But some privacy advocates argue that Instacart‘s data collection and personalization practices can veer into intrusive territory, especially given how much the company is able to infer about your household, diet, and lifestyle from your grocery purchases over time.

"There‘s a big difference between a store recommending products to you based on what you‘re buying in the moment and a delivery app building a detailed profile of your consumption habits to target you across the internet," said Marshall Erwin, senior director of trust and security at Mozilla. "That level of tracking and profiling shouldn‘t be the default, and users should have an easy way to opt out."

Instacart‘s Data Sharing Practices Explained

At this point you may be wondering: Does Instacart share or sell my data to anyone else? The answer is yes, in certain contexts explained (albeit in rather dense legalese) in the company‘s privacy policy.

Some of the third parties Instacart may share your information with include:

  • The retailers you place orders with through Instacart, who may use your data for their own marketing or analytics purposes depending on their privacy policies
  • Service providers that help Instacart operate its business, like payment processors, fraud prevention services, marketing firms, and consumer research companies
  • Instacart‘s advertisers and advertising partners, who may use your data to personalize the ads you see on other websites and apps based on your Instacart activity
  • Government authorities, law enforcement, and other third parties when Instacart is compelled to disclose data to comply with legal requirements or protect its own interests

While Instacart states that it does not "sell" customer data to third parties, some privacy experts argue that its advertising and personalization practices amount to essentially the same thing.

"Instacart may not be directly selling user data, but they are leveraging it to boost their advertising business, and in many cases allowing other companies to access that data for their own ad targeting," said Justin Brookman, director of privacy and technology policy at Consumer Reports. "From a privacy perspective, that‘s not much different than selling it outright."

How Instacart Stacks Up Against Competitors

Of course, Instacart is far from the only grocery delivery service that collects troves of user data. So how do its privacy practices compare to major rivals like Amazon Fresh, FreshDirect, Shipt, and Walmart Grocery?

Based on my analysis of their publicly available privacy policies, all of these services gather similar types of personal and transactional data as Instacart. However, there are some notable differences in how they use and share that information.

For example, FreshDirect‘s privacy policy states that the company "does not sell, rent, loan, trade, or lease any personal information collected online or offline" to third parties. That‘s a stronger stance than Instacart, which discloses that it may share data with advertisers and partners.

Amazon Fresh, on the other hand, feeds data from users‘ grocery purchases into Amazon‘s broader customer profiling and ad targeting apparatus, which is known for its sophistication and reach. So even if you only use Amazon Fresh occasionally, your activity could inform the ads you see across Amazon‘s websites, apps, and streaming platforms.

Shipt, which is owned by Target, combines data on customers‘ grocery purchases with their in-store and online Target shopping activity to build robust profiles that can be used for marketing and personalization.

The bottom line is that while all of these grocery delivery services have room for improvement when it comes to privacy, Instacart is generally on par with or slightly better than its major competitors. Still, that doesn‘t mean it couldn‘t be doing more to protect user data.

The Regulatory Landscape and Instacart‘s Future

As concerns about digital privacy have mounted in recent years, policymakers at the federal and state levels have proposed a variety of laws and regulations aimed at reining in tech companies‘ data practices.

One of the most significant legislative efforts is the American Data Privacy and Protection Act, a bipartisan proposal introduced in the House in 2022. The bill would give consumers the right to access, correct, and delete data that companies have collected about them, as well as the ability to opt out of targeted advertising and data sharing with third parties.

If passed, the ADPPA or similar legislation could force significant changes to Instacart‘s privacy practices, as well as those of its competitors. The company would likely need to provide users with more transparency and control over their data, and could face limits on its ability to share information with advertisers and partners.

In the absence of comprehensive federal privacy legislation, a growing number of states have passed their own laws aimed at protecting consumer data. The California Consumer Privacy Act (CCPA), which took effect in 2020, gives residents the right to know what personal information businesses have collected about them and to opt out of having that data sold. Instacart‘s privacy policy now includes a section detailing the CCPA rights available to its California customers.

As Instacart eyes a potential public listing in the coming years, the company will likely face growing pressure from consumers, advocacy groups, and regulators to strengthen its privacy protections and give users more control over their data. Whether the company rises to meet that challenge could have significant implications for its business model and growth prospects.

What You Can Do to Protect Your Privacy on Instacart

While Instacart and other grocery delivery services have a responsibility to be good stewards of user data, there are also steps you can take as a consumer to safeguard your own privacy:

  1. Familiarize yourself with Instacart‘s privacy policy and account settings. Take the time to read through the company‘s disclosures about its data practices, and review your privacy preferences to opt out of any data sharing or personalization features you‘re not comfortable with.

  2. Minimize the amount of data you share with Instacart. When setting up your account, provide only the minimum information required, and consider using a separate email address that‘s not tied to your other online profiles. Avoid linking your loyalty accounts from other retailers unless you‘re comfortable with Instacart accessing that data.

  3. Use a virtual payment card to keep your real credit card number private. Services like Privacy.com allow you to create virtual, single-use card numbers that you can use for online purchases without exposing your actual payment information.

  4. Opt out of data sharing and targeted advertising where possible. Instacart allows you to opt out of having your data shared with certain third-party advertisers and partners. You can also use tools like ad blockers and browser extensions to limit online tracking more broadly.

  5. Keep an eye out for suspicious activity on your account. If you notice any orders or charges you don‘t recognize, change your password immediately and contact Instacart‘s customer support to report the issue.

Ultimately, protecting your privacy online requires a combination of vigilance and proactive steps to control your data. By staying informed about how companies like Instacart handle your information and taking advantage of available privacy tools and settings, you can shop with greater peace of mind.

The Bottom Line

Instacart‘s explosive growth has made it a dominant force in the online grocery delivery market, but that success has come at the cost of significant data collection and profiling of millions of users. While the company‘s privacy practices are generally in line with industry norms, there‘s still room for improvement when it comes to transparency and user control.

As a savvy Instacart shopper and consumer advocate, my advice is to educate yourself about the company‘s data practices, take advantage of available privacy settings and tools, and keep the pressure on Instacart and policymakers to strengthen protections for user data. With a little bit of effort and awareness, you can enjoy the convenience of grocery delivery without totally sacrificing your privacy in the process.