Business Insider has a story about discontent among some Instacart employees after the company “cut base pay for filling orders … Last week, Instacart started paying its gig workers as little as $4 in base pay per order … Previously, the company paid at least $7. Base pay is an amount that Instacart shoppers and drivers are guaranteed to make if they accept an order, though they can earn more from customer tips.
“Now, many shoppers are coming to a conclusion: Working for Instacart probably isn’t worth it anymore.”
Some are saying that it makes more economic sense for them to deliver restaurant orders, which don’t require shopping, dealing with replacement items for out-of-stocks, and waiting in checkout lines.
Daniel Danker, Instacart’s chief product officer, told Insider that the company pays “guaranteed batch earnings that are 2x higher than other app-based companies.”
KC’s View:
Ironic that this story should pop on the same week that I highlighted an Instacart shopper at Stew Leonard’s going above and beyond to make sure that the products he bought for his customers met the standards for products that he’d buy for himself.
I’m not sure about all the economics, except that I’m sure that Instacart wants to be more profitable than it is. But I would argue that it ought to be investing heavily, along with its retailers, is making sure as much as possible that people like Terrence Boyd, the fellow I encountered at Stew Leonard’s, is compensated as much as possible for delivering great service. The whole house of cards depends on that.
In addition, retailers have skin in the game, because these Instacart shoppers are representing them as much as they are representing Instacart. Disillusioned and poorly motivated shoppers won’t be doing them any favors with the ultimate customer, and in fact can sabotage the retailer’s value proposition.
(One other note. If I were Stew Leonard’s, I might have a chat with Terrence Boyd and see if he’d come to work for the store. Because his attitude is not just in synch with the store’s value proposition – there actually is a sign in the back of the produce department that says, “Don’t put it out for the customer if you wouldn’t bring it home to your mother” – but it also is contagious. And if people like Terrence are dissatisfied with Instacart’s compensation programs, they may be open to other and better options.)
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