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This article was published in the December 2015 issue of STORES Magazine.

Social network Pinterest enables in-platform purchasing

The phenomenon of online shopping dates to the 1980s. British inventor Michael Aldrich introduced the concept using what was called a Videotex machine — a simple television-like device capable of linking users to a mainframe computer in another location via a telephone connection.

Three decades later, social media has introduced a new element to the mix. E-commerce has entered a new phase — one of integration between manufacturers, social media platforms, retailers and consumers.

Case in point: an alliance between social network Pinterest, software company Demandware and a pilot group of retailers.

Pinterest allows users to assemble virtual “boards” consisting of items represented by visual “pins” — images or videos that users find online. Members can follow each other and “repin” or share pins on their boards. Due to its visual nature, founder and CEO Ben Silbermann refers to Pinterest as “a catalog of ideas.”

Buyable pins enable retailers to offer products for sale directly from their Pinterest pages.

Direct sales

Shortly after its launch in 2010, Pinterest began allowing businesses to create pages to promote their products and services. Under this model, Pinterest operated as an extension to a company’s web presence.

In 2013 Pinterest approached Demandware, a developer of cloud-based software systems, to streamline the site’s e-commerce potential. According to Rob Garf, vice president of strategy and insights at Demandware, the goal was to “integrate Pinterest’s social platform with their retailer clients’ commercial platform,” providing a more efficient, seamless experience for the shopper.

In June, after a period of painstaking research, Demandware introduced “buyable pins” — a feature enabling retailers to offer products for sale directly from their Pinterest pages.

The initial retail clients Demandware worked with include Burlington, Vt.-based Gardener’s Supply, Cole Haan, Ethan Allen, Kate Spade and Jo-Ann Fabrics and Crafts. Buyable pins were initially accessible only on Apple’s iOS operating system; an Android version was introduced last month.

According to Garf, the pilot group was chosen with an eye to the visual nature of the products they offer. “People who have interests in areas that are artistic or oriented toward the arts and crafts were already heavily represented on Pinterest, and thus provided a strong potential customer base.”

But the beauty of the system is its universal potential. “Since all of our clients share the same cloud-based software,” he says, “once we cracked the code for one client, we were able to utilize virtually the same formula for others.”

Cole Haan on Pinterest

‘Democratized’ retail

While the added convenience to consumers is an obvious feature, Garf points out what the change means for the retail industry. “This move represents the democratization of retail,” he says. “In the past — whether in a physical store or on a specific retailer’s website — the merchant retained tight control on the entire process.”

A typical retailer’s marketing efforts previously consisted of drawing prospects to its particular brand. Democratized retail requires merchants to insert themselves into the new marketplace and concentrate more attention on product — assuring things like reliable order fulfillment and prompt resolution of customer concerns.

However, the retailer maintains the direct store-to-customer relationship. The transaction is processed by the Demandware platform, using existing business processes and systems including taxes, payment and shipping. Updates to products and inventory are automatically sent via Demandware’s integration framework.

The pilot group has merchants offering a diversity of durable and soft goods that includes apparel items, which are often subject to a high rate of return.

Each of these categories present unique shipping and logistical challenges which test the versatility of Demandware’s new platform, but Pinterest’s buyable pins have offered value to the pilot retailers — benefits a wide swath of retailers will ultimately enjoy as the technology becomes more widely available.

“With hundreds of thousands of monthly views of Cole Haan products on Pinterest, we intend to make these products buyable by having our entire product catalog available.”
Josh Krepon, Cole Haan

‘Great potential’

“There are well over 70 million monthly active users on Pinterest, and many of them pin products with the intent to buy,” Josh Krepon, vice president of global digital commerce at Cole Haan, said in a press release announcing the retailer’s partnership with Demandware. “It’s a tremendous opportunity for Cole Haan to enable Pinners to purchase their favorite products with just a simple tap, and Demandware has greatly simplified the effort for us to take advantage of it.”

 “With hundreds of thousands of monthly views of Cole Haan products on Pinterest, we intend to make these products buyable by having our entire product catalog available,” he said.

While charting the future can be difficult, Garf cites projections made by EKN Research:  By the end of 2017, 1 percent of all retail sales will originate from engagement platforms such as social media (not just Pinterest). While this represents just a fraction of the potential, the steep trajectory is reminiscent of the e-commerce growth patterns of the previous decade.

Garf sees another possibility: the ability of consumers to purchase products from multiple sources in one consolidated transaction, combined with a coordinated system which will calculate and execute the most efficient delivery method, a logistical challenge when dealing with items coming from several points of origin.

Main header image provided by Bloomua Slash.



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