So the Wall Street Journal reveals that social scrapbooking copyright-dodging site Pinterest is now, despite no revenue to speak of, worth $1.5bn following a new $100m round of investment, led by Japanese e-commerce giant Rakuten (owner buy.com, play.com).
On the big cash injection Hiroshi Mikitani, CEO of Rakuten said: “While some may see e-commerce as a straightforward vending machine-like experience, we believe it is a living process where both retailers and consumers can communicate, discover, and curate to make the experience more entertaining. We see tremendous synergies between Pinterest’s vision and Rakuten’s model for e-commerce. Rakuten looks forward to introducing Pinterest to the Japanese market as well as other markets around the world”.
In an interview with the Financial Times, the Rakuten CEO said he believed Pinterest would become a serious driver of e-commerce traffic by providing a “discovery shopping” experience more like browsing in a department store than search on a marketplace such as Amazon. ”They use beautiful graphics very effectively to create interest circles. Because of that, the traffic coming from Pinterest probably will have a very high conversion rate [to purchasing].” Hmm, we’re not so sure – will turning Pinterest into a giant crowdsourced shopping catalogue really work?
The Chinese seem to think so, and have ditched their Groupon clone wars, and we now have the Attack of Pin Clones, replicating at an alarming rate across Asia. And pics are in right now - Instagram was snapped up by Facebook for $1bn, Tumblr valued at $800m, and now Pinterest at $1.5bn. But just as traditional retail is buckling under the scan-and-scram showrooming trend, we can’t help think the same fate lies in await for Pinterest.