Want to know how to spend your next $1?
Don’t waste another dime on bloated channel reporting and vanity metrics.
Don’t waste another dime on bloated channel reporting and vanity metrics.
The platform is rolling out a new API, product tagging and video capabilities for merchants.
Product tagging on Pinterest. (Courtesy photo)
Pinterest has been making a series of moves signaling an expansion of ecommerce capabilities.
It was apparent as the visually-oriented social platform brought on a new CEO last week. Bill Ready brings experience as the former head of Google commerce and payments. In announcing his transition to executive chairman, cofounder Ben Silbermann hinted at how ecommerce would be the focus of Pinterest’s “next chapter.”
It was apparent through M&A. Earlier in June, Pinterest acquired The Yes, an AI-powered shopping app that provides a personalized feed of fashion items based on a user’s size and preferences. With the deal, Pinterest appointed The Yes CEO Julie Bornstein as its head of ecommerce strategy.
Now, it is apparent through product updates.
On Thursday, Pinterest announced a series of new features specifically designed for merchants, including a shopping-focused API and product tagging. The release offers a look at the tools through which the image-based platform will aim to grow as a shopping destination.
The company indicated it is seeing a convergence of commerce-related activities on the platform. The number of merchant catalogs on the platform increased 87% in Q1 2022 compared to the year prior, per the company.
At the same time, users are increasingly in a buying mood. The company said 89% of weekly Pinners use Pinterest as inspiration in their path to purchase, while the number of Pinners engaging with shopping surfaces on Pinterest grew over 215% in 2021.
The personnel announcements and data sets the tone for the company's designs on becoming a home for shopping. New features point at how it will work.
Pinterest’s strong suit is in the early stages of a journey. Users look to the platform for ideas. With commerce features, Pinterest wants to create a path where they can purchase what they see.
"Our vision for shopping is to make it possible to buy anything Pinners are inspired by on the platform," Pinterest SVP of engineering Jeremy King, said in a statement.
With the new features, King said, the goal is to allow brands and retailers to “reach high-intent Pinners during the earliest stage of their shopping journey with the most updated catalog data.”
The features announced Thursday include the following:
This will allow merchants to make lifestyle Pins shoppable. Building on already-available standalone product Pins, This allows merchants to add products from their catalog to scene images. “In initial tests, Pinners showed 70% higher shopping intent on product Pins tagged in scene/brand images than standalone product Pins,” Pinterest said.
This will provide merchants with new tools to manage a catalog and product metadata. This will allow merchants to give Pinterest users more accurate information about pricing and availability of items that appear on the platform.
Seeing success of “video-like ad formats,” Pinterest is rolling out new capabilities that allow merchants to add video of products within a catalog. This will offer the chance to show a product from multiple angles.
An updated shop tab will allow merchants to customize a product group’s cover image and description, and offers an enhanced mobile interface.
These aren’t the first shopping features Pinterest has rolled out recently. Back in March, it introduced a personalized shopping page for users, as well as a beta of in-app checkout. It has rolled out augmented reality try-on tools earlier this year.
With the recent acquisition of The Yes and Ready’s introduction as CEO all coming just within the last month, it’s probably a good bet that upgrades will continue.
But the features rolled out Thursday offer a look at pieces of the journey it is moving into place. Pinterest wants to help users get a good look at items displayed in Pins and engage directly with brands and retailers, while allowing brands to ensure those items are priced and available.
Pinterest isn’t alone among platforms making a push into social commerce. To name a few recent releases: Snapchat expanded AR features designed for ecommerce, Instagram added product tagging and Twitter recently announced a shopping-focused partnership with Shopify.
It means brands and retailers will have more places to not just run ads, but set up a store-like presence. It reinforces that a new wave of ecommerce is emphasizing reaching shoppers wherever they are, rather than directing them to a couple of platforms. This has the potential to be powerful. After all, Pinterest has more than 400 million monthly active users. That's a big community to tap.
With these buildouts, each platform's ecommerce capabilities will have its own distinct flavor. Along with an emphasis on the discovery phase of the shopping journey, Pinterest characterizes what it’s building as a “home for taste-driven shopping.” It will be intriguing to see where the personalization features from The Yes fit into that.
Still, it’s worth remembering that it’s widely acknowledged that no platform has cracked the code on social commerce yet.
Pinterest's ecommerce push has our attention. It will be interesting to see whether brands and retailers start to report success on the platform as these new features roll out.
Product innovation, marketing and ecommerce helped boost sales 49% in the holiday quarter.
e.l.f. beauty Poreless Putty Primer. (Courtesy photo)
The clouds are getting darker in today's retail environment, but e.l.f. Beauty is shining. Digital commerce and marketing growth is a primary reason.
The makeup and skincare brand posted the following results for the quarter ended Dec. 31, 2022:
The brand is also outperforming category trends. The cosmetics category grew 8% over 2021, while e.l.f. grew 36%.
“We grew our market share by 150 basis points and increased our rank to the #4 brand as compared to #5 a year ago,” CEO Tarang Amin told analysts. “We continue to be the fastest-growing top five brand by a wide margin.”
The strong results proved validating for a brand that prides itself on offering affordable cosmetics, and digital-forward marketing. They were also another sign of the resurgence of beauty as people return to in-person experiences post-pandemic and seek affordable luxuries that can provide joy despite tougher economic conditions.
Here’s a breakdown of the digital drivers of growth for e.l.f., and how it is showing strong results in a tough economic environment:
@meghantrainor A special @elfyeah radiance report: It's an E.L.F.ING GLOW STORM! Please exercise ✨extreme iridescence!✨ (and thank you @weatherchannel for inspiring the glowcast!)🤍 #elfpartner
The brand prides itself on marketing that is both bold and pioneering on emerging channels.
One example came in the form of a holiday kickoff with the singer Meghan Trainor delivering a Weather Channel-informed report on social channels to celebrate the restock of the brand’s Halo Glow Liquid Filter, which was a viral sensation.
“The trifecta of e.l.f., The Weather Channel and Meghan Trainor helped us reach new audiences and entertain our community,” Amin said. “The campaign generated over five billion press impressions, exceeding last year's holiday campaign by a wide margin.”
The combination of innovation on product and virality in marketing helps attract a new audience for the brand.
“They see the viral buzz,” Amin said. “They see other people talking about this prestige quality, these great prices and particularly these days with platforms like TikTok, we get consumers doing their own demonstrations and comparisons.”
When it comes to metrics, Amin said the brand explores, “What percent behind each product are we pulling in new users?”
It's often up more than 50%, and attracts the core consumer in Gen Z as well as millennials and Gen X.
“I think the quality of these products at the prices we have and our ability to engage them really are attracting even more consumers to our franchise,” Amin said.
e.l.f. also deepened its marketing investment. The overall share of marketing is now 16%, as compared to 7% three years ago. It will increase to 17-19% this fiscal year.
“We recently completed our annual Nielsen marketing mix analysis and again saw exceptional ROI results, giving us further confidence that our marketing and digital initiatives are driving brand demand and delivering profitable growth,” Amin said.
Strong ROIs were observed across digital advertising and influencer marketing, while PR was “off the charts,” Amin said. Experimentation also plays a key role in developing these channels.
“The other thing about us is, we're not afraid to test and learn our new platforms. So we were one of the first beauty brands on TikTok. In the early days, it was hard to get attribution on TikTok. We now can see almost immediately when something goes viral on TikTok, the impact it has on our business and our ability to be able to attract that,” Amin said.
When it comes to ecommerce, Q3 digital consumption trends were up over 75% year-over-year, said CFO Mandy Fields. Digital channels drove 17% of total consumption in Q3, up from 14% a year ago. In the quarter that includes the holidays, digital channels were particularly strong through Black Friday and Cyber Monday.
A big point of emphasis for digital growth is the company’s Beauty Squad loyalty program, which provides early access, exclusives, free gifts and bonus points. The program grew enrollment 25% year-over-year to 3.5 million members. The loyalty program helps to boost the value of individual customers.
“Our loyalty members drive almost 70% of our sales on elfcosmetics.com have higher average order values, purchase more frequently, have stronger retention rates and are a rich source of first-party data,” CFO Mandy Fields said.
Plenty of brands and retailers reporting earnings over this week are speaking of a slowdown in demand as a result of inflation and cooling demand in the economy. They also talk of consumers trading down to more affordable and smaller products that challenge margins. Amin batted away that kind of talk.
“No, we've not seen any slowdown in demand,” Amin said.
The response spoke to the unique place that beauty sits in this moment.
“What I'd tell you is, historically, mass color cosmetics, mass skin care has fared really well in…recessionary environments,” he said, referring to the Lipstick Index that posits beauty sales rise during economic downturns as people seek the small joys when they have less to spend on bigger items.
But there’s also a timing factor coming out of the pandemic.
“This is a category that really did suffer during the pandemic when people were restricted from their normal behavior,” Amin said. “So I've long felt there's a lot of pent-up consumer demand for the categories in which we compete, and we very much are seeing that.”