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Pinterest, one of the most widely used photo sharing platforms for content creators, artists and casual users, has filed its S-1 form in order to conduct an initial public offering (IPO). In the post-IPO era,
Pinterest is would intend to expand into the e-commerce market, competing with likes like Instagram, Amazon and Walmart.
Based on the success of its initiative to create an e-commerce-enabled platform, Pinterest may be able to secure a new source of revenue that it has not yet addressed.
"We are at the beginning of our monetization efforts, and there is no guarantee that we will be able to adapt our business to future growth," the company said.
In 2017, the company was valued at $ 12.3 billion. Since then, Pinterest's revenues have increased by $ 482.8 million to reach $ 755.9 million, ensuring a user base of $ 265 million last year.
Will Pinterest be able to compete against Instagram and Amazon?
Earlier this week, Instagram had incorporated a new feature into its platform for US users, allowing users to purchase products directly from the app.
Through machine learning, Instagram detects products featured on photos uploaded by users on the platform, thus simplifying the process of finding and purchasing products by users.
"From the consumer's point of view, we want to create a complete shopping experience," said Vishal Shah, Instagram Product Manager.
According to Linz Shelton, director of social media Michael Kors, since the creation of Instagram, users use the platform to discover and buy products such as clothing and other items related to fashion.
"Enabling direct purchases is a natural extension of how the social media platform was used. Since Instagram came out, people are using it as a platform for buying, whether it be designed this way or not, "Shelton added.
Analysts have suggested that introducing the new feature of Instagram would provide an additional source of revenue for the social media giant, increasing the stability and sustainability of the company.
Pinterest aims for a similar result with a similar strategy and is in an ideal position to appeal to users as an ecommerce platform because of the popularity of the platform among users interested in fashion and design.
From food to furniture, as Pinterest's top 100 attractions show in 2019, the topics that have attracted users over the past year have been extremely diverse.
The Top 100 Interest Centers 2019 (Source: Pinterest.com)
Thus, Pinterest may be able to differentiate sufficiently its economic model from Instagram by integrating an e-commerce function for a wide range of products, particularly in the areas of food, interior design, fashion and well-being. other.
In the short term, it is said that Instagram focuses on clothing and collaborates with companies like Nike.
What does it do for Amazon?
Amazon has diversified its revenue through a variety of services, including Prime, Amazon Web Services, and daily grocery delivery.
Many tech and retail companies rely heavily on machine learning and artificial intelligence to compete with Amazon and gain market share in the e-commerce sector.
It's unclear whether the demand for online shopping on social media platforms could increase to such an extent that it begins to affect Amazon's online sales, Pinterest and Instagram. both seek to secure a niche market that will certainly evolve in the coming months. .
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