Fifth place in our Top 5 social media list is held by the globally known Pinterest platform. Although it has maintained its place from last year, the social network is evolving by integrating advanced artificial intelligence tools and improving the social shopping experience through partnerships with major companies. These developments aim to streamline online shopping and improve ad engagement.
About Pinterest
Pinterest is a visual discovery platform that allows users to explore, save ideas in different areas of life, from fashion and beauty to home renovation and cooking. Pinterest was founded by Ben Silbermann, Paul Sciarra and Evan Sharp in San Francisco in 2010. Its predecessor was the Tote app, which served as an alternative for paper catalogues. Today, the social network is used by 522 million monthly active users worldwide. The platform creates personalized content through a home feed based on user activity, while its robust search function allows to discover trends, brands and products. Users can easily share inspirations, make direct purchases through linked retailer sites. The company went public on the New York Stock Exchange in April 2019.
Social shopping
It was direct purchases that the online retailer Amazon took advantage of. The retailer is widening its e-commerce presence by partnering with Pinterest and TikTok. The main goal of the collaboration is to make it easier for users of both social networks to shop Amazon products directly in their apps. Through shoppable ads, users can seamlessly purchase goods without leaving the apps, with features such as up-to-date prices, product details or delivery information visible once accounts are linked to Amazon. Although the collaboration with Tik Tok is new, Pinterest and Amazon have been working together for some time. The social networking platform is used for the retailer’s cost-per-click advertising campaigns. Users are shown ads from companies participating in the Amazon’s Sponsored Product program based on the user’s interest. In addition, Pinterest has also incorporated third-party promotions from the Amazon Ads program, thereby also seeking to simplify shopping.
Back-to-school
American clothing brands Pacific Sunwear of California (PacSun) and Urban Outfitters have decided to use the power of Pinterest communities to expand their reach among young consumers. PacSun’s autumn campaign “Better in Baggy” will be available in all their stores, and thanks to interactive QR-coded storefronts, customers will be able to link to Pinterest boards. The launch of the new denim campaign took place at the end of July at the Soho store, where visitors enjoyed live music, fashion experiences and giveaways. Making it easier to grow up and connect authentically with a brand are the main goals of Urban Outfitters’ “Shift Happens” campaign, integrating Pinterest boards created by influencers through which the younger generation of consumers can shop. In addition to the July launch and live performances at The Chelsea Factory, the campaign will also include campus events and collaborations with popular brands. Both campaigns effectively combine social media with real-world experiences to strengthen their connection with young consumers.
New tools using AI
Pinterest is also keeping the platform’s users in mind and has introduced new tools to increase creativity, improve campaign performance and ensure brand safety for advertisers. The new Pinterest Ad Labs allows select brands to experiment with ad prototypes, including artificial intelligence-powered functions such as personalized background generation. The feature uses Pinterest’s generative AI to customize backgrounds for posts, increasing the visual appeal and engagement of ads. Newly introduced collages help advertisers to create, design and promote their content. Early users of the feature include brands such as Nike, NYX Professional Make up and John Lewis. The company also launched Pinterest Performance+, which leverages AI to streamline campaign creation and increase its performance. The tool has already shown cost efficiencies during alpha testing, while also reducing the time to set up a campaign. In addition, Pinterest is expanding its commitment to brand safety through partnerships with Integral Ad Science and DoubleVerify. These integrations ensure that ad impressions are accurately classified and deemed safe, with early tests showing that more than 99 % of measured impressions meet brand safety standards.
Financial data and stock movements
In the 2Q of this year, the company managed to increase revenues by 21 % year-on-year to $854 million and erase the loss, which stood at $24.81 million in 1Q of 2024. The 2Q profit reached more than $8.8 million. Thanks to their initiatives and products, they have also managed to grow their user base to 522 million monthly active users, up 12 % from 2Q last year and with an 8 % higher average revenue per user. Despite beating expectations, their 3Q earnings outlook didn’t impress analysts that much. The stock is not doing so well either. Despite a period between April and July 2024 when the stock was up and over $40, there was a significant correction at the end of July when the stock dropped to its current value of around $30. This is still an increase of more than 24% from the IPO price, but since the beginning of the year they have fallen by more than 15% and since their all-time high in February 2021 it is a slump of 64.5 %.*
Movement of Pinterest’s stocks in the last five years. (Source: Yahoo Finance)
Conclusion
Pinterest is enhancing its platform with new AI-driven tools and deepening partnerships with major retailers like Amazon, PacSun, and Urban Outfitters to boost social shopping and campaign effectiveness. The integration of personalized ad features and shoppable content aims to streamline user experiences and improve engagement. While these innovations reflect Pinterest’s commitment to staying at the forefront of social commerce, the company’s stock has faced volatility, experiencing a notable decline from its previous highs. Despite this, Pinterest continues to innovate and adapt, focusing on enhancing both user and advertiser experiences.
* Past performance is no guarantee of future results.
