Why Did PayPal Want To Buy Pinterest?
It wanted to be the Anti-Amazon
I saw the news that PayPal balked at buying Pinterest after an extremely negative reaction from its shareholders (Pinterest is expensive!). But why did PayPal want to buy Pinterest in the first place?
I think of PayPal as a credit card company. Obviously, it’s got more fintech bells and whistles than say a Visa, but it maximizes revenues the same way — by getting as many transactions to occur on its network as possible (since it makes a small cut of each transaction).
Pinterest is a social media company, albeit a more commerce focused one. For other social media companies like Facebook, the strategy has always been horde the users and data and the advertisers will follow. Pinterest, on the other hand, is a combination of visual search (each pin is a pinned picture that someone at some point found interesting) and serendipitous recommender. It aims to push pictures of things you might be interested in to you based on both what you search and its algorithmic determination of what you might be interested in with the hopes that you might buy a thing or two (or click-through into a promoted pin or two).
So what’s the *ahem* synergy between the two companies? Well at first glance, there doesn’t seem to be much of any. Pinterest more or less sells ads so…
