Brief:

• Pinterest, the image search application with more than 200 million users, partnered with Target to let people snap product photos and browse similar items for sale at the retailer, TechCrunch reported. The licensing agreement is the first time that Pinterest has integrated its Lens image search feature in the mobile apps of a retailer. The tool will be embedded in Target's app and will later be available on the retailer's desktop website.
• Target is currently the only U.S. retailer using Pinterest Lens as part of the multiyear deal, according to The Wall Street Journal. Pinterest said businesses in other industries could benefit from Lens and that it has valuable information to share with advertisers about trends.
• The companies did not disclose financial details of the partnership, but WSJ reported that Target is paying for a Promoted Pin, which means Pinterest users will see more of Target’s images when they search or browse their home feed.

Insight:

Pinterest in February introduced its Lens technology to let people point their smartphone cameras at objects and find similar items from its image search engine. A Shop the Look feature let people track down and buy products seen inside fashion and home decor Pins. The privately held company has made significant investments in its image search technology to compete with Google, which also has a service called Lens to help identify objects with their smartphone cameras.

Pinterest needs to continue developing its image identification technology and to monetize the service through agreements like the one with Target that close the loop between seeing a product and buying something similar online or in a store. Tim Kendall, the president of Pinterest, told the WSJ that he expects to take a similar approach of using technology and data to attract other major brands and advertisers. The seven-year-old company is aiming for $500 million in revenue this year, compared with about $300 million last year, a person familiar with the matter told WSJ.

For Target, the Lens technology will help to point people to its products without the need for a keyword, which is the basis for traditional web searches. As TechCrunch notes, instead of typing in a term like “modern crib,” a smartphone user needs to only take a picture of a product to get a set of related results, a move that reduces friction and could likely make for a more seamless mobile shopping experience. Image search combined with voice search may make up 50% of all searches by 2020, Target said, signaling a potential big tech opportunity for the retailer that appears to be at the forefront of the industry by integrating this feature into its mobile app.