It looks like Pinterest is growing up!
It seems like just yesterday when we all started hearing about this new thing that was, basically, a place for people to look at cool stuff and share it with their friends. And it caught on fast, and quickly became the hottest social network out there.
Now, like all social networks, Pinterest has to go from beyond just being a cool idea. Facebook has already gone public, and Twitter is next. Social media sites are being taken seriously by investors now, and that means showing that they can make real money.
So get ready for advertising on Pinterest.
"Pinterest is where you keep your wishlists, vacation plans, dream home ideas, and other things you want to do soon and in the future," Pinterest CEO and co-founder Ben Silbermann wrote in a blog post on Thursday.
"That’s why for us, it’s so important that Pinterest is a service that will be here to stay. To help make sure it does, we’re going to start experimenting with promoting certain pins from a select group of businesses."
With advertising comes a certain amount of a responsibility, though, meaning: do not get in the way of the users! So Silbermann made a few promises:
The ads will be "tasteful," "transparent," and "relevant."
The first and third one of those is pretty obvious; nobody wants to run ads that will be distracting, and certainly nobody wants to run any that the user has no interest in. That's just a waste of money.
The second, however, intrigues me. Here is how Silbermann explains it, "We’ll always let you know if someone paid for what you see, or where you see it."
It would be easy for Pinterest to start showing its users content that had been paid for without ever telling them; they could just make those suggestions and pretend like they were organic. I like the idea of a company being straightforward with its users though. It shows a certain amount of respect and forethought.
You can expect these ads to first appear in search results and category feeds. The example, that Pinterest gives is a pin for a Darth Vader outfit from a costume shop might be promoted in a search for “halloween.”
:Nobody’s paying for anything yet—we want to see how things go and, more than anything, hear what you think," said Silbermann.
Pinterest for business
Of course Pinterest turned to advertising for monetization. It's an obvious move, for many reasons.
First, look at Facebook. In its latest earnings report, it revenue from advertising was $1.60 billion, or 88% of total revenue.
Second, advertising fits really well into the Pinterest model. The site it all about giving people pictures of things; they already almost act as advertisements, but now someone will be paying for them.
And third, Pinterest has been doing everything it can to strengthen its relationship with brands and advertisers over the last year. So this move has been a long time coming.
The company started with the creation of business accounts in November of last year.
Pinterest also introduced new tools for them to use on those accounts. including a verification badge, which is meant to people identify high-quality sources of content and more easily find the business they want in search results, and new buttons and widgets, such as the Pin It button, Follow button, and Profile widget, which are meant to increase engagement from pinners and traffic back the business website.
In March, Pinterest launched an analytics tool to help businesses see how much traffic Pinterest has referred to their websites.
The tool provides information to business clients regarding activity on their Pinterest accounts, including how frequently users are clicking on their photos.
San Francisco-based Pinterest was launched in March 2010. The company has raised a total of $338 million since then.
In February, Pinterest raised $200 million in a round of funding that was led by Valiant Capital Management, with participation from existing investors Andreessen Horowitz, Bessemer Venture Partners, and FirstMark Capital. The new round valued the company at $2.5 billion.
(Image source: http://www.projecteve.com)