Pinterest’s New Tech: Machine Learning, Product Recs for Smarter Social Commerce

Popular social network Pinterest announced on Wednesday it acquired Kosei, a startup company specializing in machine learning and product recommendations.

Pinterest launched native ads through Promoted Pins this year after months of testing, which provides ads that look like organic pins on users’ boards. According to Pinterest, Kosei will help in recommending advertised pins that look more natural on the boards, as well as the ability to predict what content a user would be likely to pin. Other social networks that are experimented with advertising last year included Instagram and Tumblr, with the latter rolling out buy buttons late last year. Unlike many other social networks that focus on chronicling the past and immediate present, however, what sets Pinterest apart is the aspirational element. There are boards on Pinterest where users compile items they discovered on the network and might want to purchase “someday,” even if it’s currently out of their price range.

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A look at promoted pins, which displays ads relevant to the current pins users are looking at.

It’ll be interesting to see how advertising on Pinterest will increase engagement with these frequently pinned brands, and harness the pins later for direct purchases. An algorithm that can accurately predict the next pin and turn it into a purchase will have a huge impact in the way marketers can use social media to influence consumers.

What’s more, Pinterest’s aspirational fashion aspect might provide a different way to provide content. How will pinning high end brands translate into direct eCommerce in the future? For example, if a user pins a Chanel bag on fashion board, marketers could potentially harness machine learning to identify and advertise a more affordable designer bag in a similar style. This kind of scenario could present a completely new style of product recommendation for social commerce.

According to a survey by Pew Research, 42% of women online in the US use Pinterest. That’s a lot of purchasing potential, especially on a network where personal taste and style is being carefully curated. The ability to directly target and personalize ads down to the individual level will bring Pinterest closer to potentially being the most impactful social network for commerce. It’s still unclear if social commerce will become a significant revenue-generating channel in 2015, but it certainly is shaping up to be important in the not-too-distant future.