Social media is ready for its own kind of retail therapy

Social media platforms are bracing for a potentially rough quarter, but they do have one hope: those “tap here to buy now” ads.

Driving the news: Pinterest said it hit its first quarterly profit of the year because its ads are more relevant than ever. That was a much more optimistic tone than its competitors.

  • E-commerce is a huge part of Pinterest’s ad pitch since its users are already primed to try to recreate the outfits or home decor they are looking at for inspiration.

Big picture: Meanwhile, Meta and Snap cast a pall over their unexpected recovery from recent advertiser pullbacks, citing the potential business impact of the Israel-Hamas war. 

Why it matters: It might not be as buzzy as AI, but social platforms have spent years investing in the opportunity for growth around e-commerce, with zero signs of slowing down.

  • Pinterest has enlisted Amazon to provide ads that link directly to product pages, opening the platform up to sellers already part of Amazon’s growing ad network.

  • Snap and TikTok have joined Meta and Pinterest on Shopify Audiences, a tool that helps small, local retailers run e-commerce-linked ads on major social networks.

  • Meta recently introduced a paid program that verifies Canadian businesses and gives them access to tools that improve visibility on Facebook and Instagram.

Yes, but: Shopping-focused ads only work if the people seeing them are actually able to buy stuff. And if we are headed towards a recession, that isn’t a certainty.—JK