Growth is the ticket to Pinterest’s funding, since it hasn’t had the opportunity to have slowing revenue growth or disappoint investors with monetization troubles yet, because it has yet to even try to make any money. In fact, the company started its first test of advertising, called “promoted pins” that appear in search results and category feeds, just a few weeks ago.
But that’s an unpaid trial, according to the extensive disclosure post personally penned by Pinterest CEO Ben Silbermann that tried to ease users into the idea of advertisers having any place at all on the site.
I’m not a Pinterest user nor have I registered an account but this is intriguing from an advertising perspective. Unlike Twitter and Facebook where they have to parse text in order to derive meaning from peoples’ tweets and posts, Pinterest users “pin” exactly what they like to their profiles.
This means Pinterest can potentially sell the most accurate data to advertisers about users’ likes and can command higher than usual rates for it. It’s the first big social media company that seems to have a plan for generating actual, sustainable revenue going forward. Twitter’s doing better, but Facebook is pretty average for now. The TNT crew had a discussion about this topic on yesterday’s episode and it’s worth checking.
Again, a special shout-out to Mostafa for pointing me towards this!