Instacart slashes prices as delivery competition heats up

Instacart has made changes to its pricing in Canada and the U.S, making the service a more competitive and cost-feasible option than companies such as Amazon.

In a Nov. 28 e-mail from the third-party service to its customers, Instacart said it had dropped its delivery fee in the U.S. from $5.99 to $3.99 per order of $35 or more, though customers still pay a 5% service fee and $3.99 default delivery fee. Orders arrive within two hours of placement. In Canada, shoppers were already paying $3.99 for the a la carte service so that remains unchanged. The company has, however, lowered the service fee to 5% from 7.5%, according to a company spokesperson.

Additionally, the annual subscription fee to the company's Instacart Express service dropped by $50 to $99, which is what Canadian members have been paying. Though the annual fee remains unchanged north of the border, the company dropped the 7.5% service fee.

"We've made grocery delivery more affordable. … Let our personal shoppers take care of your grocery shopping while you save an hour or two," the grocery e-commerce service said in the e-mail.

Currently, members of Amazon's Prime subscription program can enjoy two-hour delivery of groceries from Whole Foods for free, and ultra-fast delivery within one hour for $7.99 on orders of $35 or more. An Amazon Prime membership costs $119 annually--up $20 as of May--or $12.99 per month, but the value over Instacart arguably is unlimited free two-day delivery through Amazon, content streaming and more, which the San Francisco-based delivery service does not offer.

A version of this article appeared at ProgressiveGrocer.com.