Is Pinterest the social e-commerce answer?

posted by Dave Allen, Leave a Comment

I wrote about Pinterest recently #, or more accurately, I wrote about being a man who uses Pinterest as I felt there was a rather sexist, elitist, East-West-coast-big-city snobbery aimed at it’s users. One male commentator supplied damning evidence of its “uselessness” because he surmised that the majority of its users were based in “fly-over country.” Who says American education is suffering..?

With news this morning that Pinterest raised $100 million from its backers #, perhaps that bright spark will think again, as this values Pinterest at $1.5 billion. Maybe having an audience that lives and shops in “fly-over country” isn’t such a bad thing?

And shopping is the key to understanding Pinterest’s valuation. The company may be able to provide the answer to increasing e-commerce on the social web. Facebook has been struggling in this arena #

The latest investment round was led by Japanese e-commerce giant Rakuten and Rakuten CEO Hiroshi Mikitani has this to say:

“While some may see e-commerce as a straightforward vending machine-like experience, we believe it is a living process where both retailers and consumers can communicate, discover, and curate to make the experience more entertaining.

“We see tremendous synergies between Pinterest’s vision and Rakuten’s model for e-commerce. Rakuten looks forward to introducing Pinterest to the Japanese market as well as other markets around the world.”

So, Rakuten sees the potential of Pinterest users, who clip and share items, being motivated to make purchases of those very items they are sharing.

And here’s Pinterest CEO Ben Silberman:

“Our goal is to help people discover things they love, by connecting people through their shared interests. Bringing Rakuten on board gives us an amazing opportunity to move a step closer to this goal.”

I sense that the Rakuten investment isn’t about looking for a return on their money by selling Pinterest to the usual suspects – Facebook, Amazon, Google – but I could be wrong.

And let’s be clear here – don’t confuse Pinterest with a social network like Facebook. That’s not accurate. It’s more akin to Tumblr than Facebook. When using Pinterest you are technically following people’s passions, not those people themselves. Profiles on Pinterest (here’s mine #) are pulled from Twitter for instance, and can be left as simple as that. There is no “timeline” but there are ample opportunities to share everything that’s compelling to you. Think of it as Twitter on steroids where you can post an image with an embedded link and you have the ability to write 500 characters about the story behind the image. Here’s another example #.

And brands will be able to let their followers purchase their goods.

Maybe now we will see brands rushing to ensure that their websites are mobile-friendly and have a seamless mobile e-commerce solution, because I’d hazard a guess that a lot of Pinterest traffic is coming from the iPad.

And above all, your brand site better be Pinterest-friendly.

Creative destruction in contemporary culture

posted by Dave Allen, Leave a Comment

The New York Times’ A.O. Scott and David Carr wrestle with this one..

Stefan Olander, VP Nike: Stop focusing on clicks or Likes

posted by Dave Allen, 4 Comments

Well, well, well. As a proud owner of a Nike+ FuelBand # I agree.

Speaking at the launch of Velocity: The Seven New Laws for a World Gone Digital, which he co-authored with AKQA chairman Ajaz Ahmed, Stefan Olander, vice-president of digital sport for Nike, said brands should stop focusing on clicks or “likes”.

He said: “A whole industry is stuck on trying to force old metrics on to new channels.

“Too many businesses are thinking ‘I need to sell inventory’, rather than ‘How can I add value to a smartphone, or a new device?‘”

On the topic of social media, Olander questioned the recent valuation of digital companies such as Facebook, commenting that a $100bn valuation of a company based upon an advertising model is “a little risky”.

He said: “Advertising is an old model that is being squeezed into the new framework of social media, when the fact is that people don’t want to be interrupted.”

According to Olander, Google AdWords is the only commercial model that is proven to work.

He said: “You look at the Instagram $1bn valuation – and Instagram doesn’t make money.

“But it will be interesting to see, when it is combined with Facebook’s platform, what value that creates.”

Nike has moved away from investing in advertising to the creation of digital services such as Nike+. According to Olander, “once you have established a direct relationship with a consumer, you don’t need to advertise to them”.