Pinterest (NYSE:PINS) launched its latest innovation on Jan. 28, and that could end up being great news for Pinterest stock.
The new feature will “allow users to virtually try on products” such as lipstick by simply using the camera on your phone. And although they’re not the first company to attempt this, it seems PINS is stepping up their game for consumers.
If the move is successful, which I believe it will be, Pinterest stock could see $30 long before the end of 2020.
Pinterest Puts Its Spin on Augmented Reality
It’s coming up on three years since Pinterest launched Lens, what The Verge termed “a Shazam for objects” at the time. The visual search tool allows a user to take a picture of an object they see in the real world; Lens then takes that image and finds objects it has that are related to what’s in the picture.
Taking Lens one step further, Pinterest introduced “Shop the Look,” which found similar items and provided links to companies and websites selling those items. It was the beginning of Pinterest’s move to capture a big slice of advertising dollars from companies eager to engage more closely with their customers.
I’ve been a fan of Pinterest’s business model ever since it went public last April. I liked it when it was trading above $30 in late August through September, and I really liked it when it was flirting with $20 in mid-November.
Furthermore, Pinterest added more improvements to Lens in September that included making it easier to perform searches from photos. The company also introduced shoppable Pins with prices, product information and the ability to buy directly. Overall, Lens’ use of machine learning is now so powerful that it can now recognize more than 2.5 billion objects related to home and fashion.
That, in itself, is a fantastic progression in just three years. Now, the company wants users to be able to try on products virtually — speeding up the shopping process through the use of augmented reality (AR).
A Game Changer
I hate to call anything a game changer given how fast technology changes these days. However, it does seem like a natural evolution for a company whose social media platform revolves around a person’s interests; Not their network or group of followers.
As I described above, Pinterest has created a shopping tool through Lens that is much more intuitive and tuned in to your interests. As a result, it only seems natural that it would use AR to allow you to “try on” products you’re interested in before spending the money.
Starting with lipstick, Pinterest has launched Try On, powered by Lens, which allows users to try on lipstick from several retailers — including Sephora — before buying online. Once it’s worked out the kinks, you can be sure it will roll out AR for other categories.
It’s no wonder Cowen & Company found Pinterest to be the most popular social media platform for finding and shopping for products. Pinterest developed Try On because users told it that’s what they needed to make better online purchases with their mobile phones.
And in my opinion, it’s these kinds of moves that put it heads above the competition.
What Does It Mean for Pinterest Stock?
As long as Pinterest continues to focus on the user experience, I don’t think it’s going to have a problem wooing advertisers to its doorstep. Revenues will continue to grow, and its scale will deliver consistent profits.
Earlier this month, Pinterest’s stock jumped more than 10% in a single day on the news it had surpassed Snap (NYSE:SNAP) to become the third-largest social media platform in the U.S., behind Twitter (NYSE:TWTR) and Facebook (NASDAQ:FB).
With 82.4 million monthly users, Pinterest is grabbing users from all walks of life — something Snapchat hasn’t been able to accomplish.
I use Pinterest, and I’m 55. And while I haven’t bought something through Pinterest, I have purchased products offline as a result of searches and pins I’ve found.
Now, the only thing holding me back from selling all my worldly possessions and investing in Pinterest stock is my wife. She’s an avid Instagram user, so if she joins the Pinterest camp, I know I’m onto something.
In the meantime, investors ought to try on Pinterest for size. I think you’ll find it fits like a glove.
At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities.