On Tuesday, Sept. 17, Pinterest announced their visual search technology can now identify more than 2.5 billion objects across home and fashion Pins. The announcement came with a series of updates to their Visual Search tool, Lens:
Pinterest has been innovating in the Visual Search landscape since launching Lens in February 2017. In its first year, Lens Visual Searches increased 140%, hitting 600 million in February 2018. While Pinterest was relatively early to the game, they are far from the only player.
Google has been working on its Lens tool, integrating it natively into Google Photos and within the camera app of certain Android devices. Knowing the power of Google as a search engine, and the advantage of integrating natively in the camera vs. a separate app, Google has the power to quickly become a leader in the space.
Microsoft introduced its own tool within Bing in June 2018. The visual search tool can identify much more than products, including landmarks, animals and plants. It operates similar to Pinterest Lens by surfacing product suggestions based on fashion and home, making it a viable competitor.
Snapchat and Amazon partnered in September 2018 to give users the ability to visually search a product and immediately buy it on Amazon. While the technology is still in its early stages, the positioning of Snapchat does have some advantages. The Snapchat camera is its primary feature, and the app opens directly into the camera. Snapchatters have been using AR in the platform for years, making visual search a seamless experience. From a competitive perspective, Pinterest does have slightly more users than Snapchat – 78.7M US users in 2019 compared to Snapchat’s 77.5M. But Pinterest skews older with only 33.7M US users 12-34 compared to Snapchat’s 59.1M. Knowing visual search has the strongest potential with millennials and Gen Z, this segment could give Snapchat the advantage.
Facebook has been developing its image recognition software for years, using the technology to tag trillions of photos for content, making text-based image search more effective. While the daily user sees this technology in facial-recognition photo tagging, the potential to launch into Visual Search ultimately is huge. If Facebook does launch this technology, the social giant could easily start to monopolize the space, with 191.2M users on Facebook, 118.5M users on Instagram and 68.1M users on WhatsApp in North America alone.
Visual Search is still new to monetize, but ARtillery Intelligence predicts that Visual Search/Augmented Reality Ad Revenue will hit $1.2M in 2020, with the potential to hit $835.7M in 2022. The platforms that do Visual Search right and monetize successfully will have significant revenue potential.
Do consumers actually want to use Visual Search when it comes to making a purchase? Many do. In fact, it may be the next big thing.
When asked what new technologies US and UK Internet shoppers would be most comfortable with as part of their digital shopping experience, 62.2% of younger and 61.7% of older millennials said the ability to search by image (visual search).1 This out-performed shoppable content, AR and live chat/messaging assistants. It makes sense, when it comes to shopping, seeing the product in its natural environment ranks above other services. According to Performics’ Digital Satisfaction Index(DSI), a consumer attitude and perception study produced by the Intent lab, a partnership between Performics and Northwestern University, 36% of respondents have performed or used visual search and 59% think visual information is more important than textual across multiple categories.
Pinterest released a study saying 80% of Pinners start with visual search when shopping compared to 58% of non-Pinners. In their study, over 85% of respondents said visual information was more important than text when it came to clothing or furniture, and 55% said Visual Search is instrumental in developing their style and taste. When it comes to owning inspiration in the purchase journey, Pinterest is a strong performer. The ability to recognize more products in the home and fashion space, combined with the connection to surface actual buyable products gives Pinterest the ability to connect, and even shorten, the Purchase Journey for the consumer.
The spotlight may be on e-commerce, but brick and mortar stores stand to benefit from Pinterest’s new initiatives. While Pinterest’s highest penetration is in home goods and apparel, the company is making a push in grocery and CPG. Arthur Sevilla, head of CPG at Pinterest, delivered a keynote address at the Groceryshop conference Sept. 17 outlining the role the platform has to play in this rapidly changing category. Because while e-commerce is on the rise, just 2%-3% of all grocery sales are digital. Consumers are searching for product information, recipes and inspiration online, but are still largely heading to store to buy. “Pinterest is a visual discovery engine,” said Sevilla. “We believe the actual value of Pinterest is not on the platform, it’s off.”
Some 55% of Pinterest users use pins while in stores, seeking inspiration, to discover new products and build digital shopping lists and 70M US monthly users engage with food and beverage products.
Pinterest is building a shopper solution designed to push shoppers to specific retailers, said Sevilla. Tactical solutions are being tested, including some from third-party providers that can push a couple from a pin and match that pin to a zip code to show price and availability at a nearby retailer, ultimately putting that pinned item in a digital cart for later purchase.
Visual Search is still in its infancy when it comes to other Social Commerce technologies, but integrating Visual Search into social shows huge growth potential. According to a Bizrate Insights report, 34% of US Internet users surveyed reported they have made purchases through social media, increasing to 44% with the 18-34 year old segment. An additional 27% have not used the technology, but are interested. Compare this to other emerging technologies like AR and VR, which just 6% of respondents report ever using while shopping.
Social is also growing faster than any other channel in visit share to US retail sites by last-touch attribution. Between 2016 and 2018, social network traffic to retail grew 110% while paid search grew 16% and display, 1%. Integrating Visual Search into Social Commerce can help the technology become more adopted and ultimately drive more revenue. As commerce becomes more mobile, projected to hit 53.7% of ecommerce sales by 2021, and social is inherently mobile, we can only expect the social commerce trend to continue to grow and thrive.
The Bottom Line: With home projected to hit $64.80B in retail ecommerce sales and apparel and accessories to hit $120.88B in 2019, Pinterest continuing to expand its Visual Search tool in those categories will have significant revenue potential for retailers.