Pinterest strives to make pins more shoppable, and its advertising business more profitable.

What happened

  • Pinterest users who click on a home- or style-related pin—that is, an image with a description and link to the original online source, the main currency of Pinterest—will now see a collection of similar shoppable items and recommendations. These Product Pins (a revamped version of Buyable Pins) are updated in real time to reflect the availability of the items on a brand or retailer’s ecommerce site, as well as their price. By adding metadata to their product pages, companies can enable Product Pins or entire product catalogs that live on Pinterest. As before, they can also pay for promotional pins, which is the company’s only source of revenue.
  • This move comes after Pinterest acquired the image recognition and visual search startup VisualGraph in 2014—a merger that also resulted in the February 2017 launch of a feature that matches Pinterest content to photos uploaded by users. This feature is similar to ASOS’ visual search tool, which matches shoppers’ photos of an item in real life and sources similar ones available for purchase on its own site.

Why it matters

  • Pinterest now has 250 million monthly users, but must continue its fight to stay relevant in the age of Instagram, which hit 1 billion monthy users in June 2018. Both apps are image-based, and both are ramping up efforts to become more shoppable, enabling users to discover more products, even if they are not actively using the app or site to shop. Pinterest allows users to easily save image boards on their profiles—a type of personalization that Instagram lacks (Instagram users can save images in a private feed, but the company has not prioritized building out this feature). A more deeply integrated productization effort between brands and Pinterest can help it differentiate from the competition, essentially allowing users to make wishlists and discover more products that keep them spending more time on the app.
  • Since Pinterest started testing its newest shopping-related features, clicks on products to retail sites increased 40%, which is great news for brands and retailers, but diverts traffic away from Pinterest itself. The company doesn’t currently monetize the Product Pins feature, nor does it take a cut of sales that begin on its platform. For its new feature to pay off, it will have to become a go-to shopping destination—the site consumers start a product search on, instead of Amazon, Google, Instagram or another platform—so that more brands advertise on Pinterest, building its only source of revenue. It seems like Pinterest is already working to do so: In tandem with the launch of Product Pins, the company also revamped its Ad Manager tool to streamline the ad-buying process for brands and agencies.