Everyone’s favorite online pinboard is getting monetized.
Following in the path of Zuckerberg’s “Sponsored Posts” and Costolo’s “Promoted Tweets”, the image-sharing social network Pinterest is introducing paid ads onto their website.
Launched in 2010, Pinterest has allowed its users (surpassing 70 million late last year) to upload, share, save, and sort their favorite images – or “pins” – to their profile.
And for the first time since their inception, Pinterest is looking to generate its first revenue.
The initial pilot program launched on May 12th, as Pinterest debuted their first “Promoted Pins.” These paid ads were piloted by major corporations, including Gap, Kraft, General Mills and Lululemon, who agreed to 3-6 month commitments with the network to run these new promoted images.
“Our target is 25- to 54-year-old women,” says Deanie Elsner, the CSMO at Kraft Foods Group, “and Pinterest is a perfect fit.”
Depends on who you are.
Comparing the CPM – or cost per 1,000 impressions – Facebook still makes the most financial sense for SMB’s and boutique agencies. By comparison, Pinterest’s new offering – at least initially – is better suited for top brands:
Facebook CPM – $0.59
Twitter CPM – $3.50
Pinterest CPM – $30-40
Introducing advertisements, however, is only one half of the puzzle. It won’t make sense to advertise on Pinterest – and commit to Promoted Pins – unless you can measure and track results. For advertisers, having a highly-transparent dashboard or reporting tool is just as important as the advertisement itself.
This is why on May 20th, Pinterest unveiled its new “Business Insights” API. (Note – API stands for application-programming interface and is a set of rules that allows third parties to interact with platforms and services.)
Combined with the new ad offering, Pinterest is now measurable to brands and advertisers. This new initiative will let businesses analyze activity and ad performance across third-party tools and platforms, including Hootsuite, Salesforce, Pigora and Spredfast.
Business Insights reports on what products are most popular, what images are working best (in regards to shares and likes), and what Pins are driving the most sales.
This is an exciting next step for Pinterest, and the feedback is overwhelmingly positive. In a report for the Wall Street Journal, analyst Michael Pachter predicts as much as $500 million will be generated in 2016 as a result of the new Promoted Pins.
It’ll be interesting, however, to see how the network handles frequency caps. There is a delicate line between garnering interest and over-saturating the network with advertisements. To date, the company has yet to disclose how frequent the ads will post.
“We haven’t completely landed on it,” the Pinterest team admits, noting that user feedback and data on usage patterns will be looked at.
Either way, the addition of Promoted Pins proves that you can find some financial pin-trust in Pinterest’s growth plans.