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Pinterest: 'There is Value – it’s Just a Question of How we go to Market'

Kirsty Styles

[caption id="attachment_42006" align="alignleft" width="300"]Nordstrom's excellent Pinning is being used as a model for paid-for ads Nordstrom's excellent Pinning is being used as a model for paid-for ads[/caption]

Speaking to Gene Alston, head of business development at Pinterest, it's clear why the company finally made the decision to attend Mobile World Congress in 2014.

75 per cent of its traffic comes from the platform's iPhone, iPad and Android apps and, of around 55m users, half are mobile-only, according to ComScore data.

As well as huge mobile usage, the firm is increasingly looking for partners across the mobile ecosystem, having closed a deal with Telefónica back in October to have its app preloaded on Android handsets. "We've made a huge investment in mobile," Alston says. "Whether it's creating experiences, working on user education or around efforts going to market, in the future, partners will be an important part of the Pinterest story."

Although the company is yet to make any serious revenue, it has been backed to the tune of $445m (£267.4m), giving the content finding and sharing platform a valuation of around $3.8bn. Pinterest is still trialling native Promoted Pins for free to brand partners in the US, announced back in September, targeting both search and category feeds. “We’re still trying to get a sense of what the behaviour looks like," Alston says. "Nothing like this has been out there before so we want to understand the ROI for partners before we go out with a full advertising offer.”

Brand new metrics

Something the company hadn’t quite anticipated was the potential for people to repin ads – perhaps most akin to Twitter users retweeting sponsored tweets – giving an almost new ad metric for it to grapple with. “This obviously gives advertisers additional distribution so we’re trying to decide what the best model is. It’s cool because it hopefully motivates partners to put out high quality content.” Many users simply click through to the relevant page without pinning, another chargeable action being measured during the trial, as well as simple Pin view metrics.

The company is using its existing Rich Pin model already being used to great effect by the likes of Nordstrom clothing brand to build out its paid-for ad product. Alston says that the best way for the company to start rolling out ads is for them to be ‘design-driven’ and ‘authentic to the experience’. “For Pinterest it really started out orientated around ‘put pinners first’, but then you say – ‘yeah, how does that really work with advertising?’ – so there’s been a lot of focus on doing this in a way that’s really differentiated, that adds to the experience.”

Incentivised ads?

He points to the trial of Pins with price information in them. “A value-add expression of that is if someone pins something, the price goes down. It’s great not from the supply perspective, but from a user perspective. If it’s something that I love and the price goes down, that’s a value-add for me.” A former Groupon exec, Alston is keen to emphasise that this is not a flash sale, but it is an interesting kind of incentivised advertising relationship.

Unlike Facebook, which is getting now quite heavily involved with brand creative, Pinterest is making sure the ownership rests with the advertiser, at least for now. “We see a lot of value in having people who are able to be fluent in creating content for Pinterest. I don’t think we have a really firm view on whether that’s something that Pinterest does or we work with agencies to do. There are some great companies already working on some really creative content.” Pinterest will at least ensure it creates best practice guides for its partners.”

Greatest revenue-per-user commerce platform

Pinterest is punching well above its weight in terms of the social chatter and commerce that it generates, driving the greatest revenue-per-user of all the great social platforms. According to Addshopper’s 2013 Social Commerce Data report, the platform drives a quarter of all social sales, narrowly beating Facebook, and a third of all social sharing.  A Pinterest share is worth 87? - which is more than Twitter -  but conversion is just .51 per cent, lower than email, Facebook, Google+ and Twitter.

The platform has also become a driver of news traffic, slightly surprising given its visual emphasis. “The approach we’re taking across all Pinterest types is to include more information in a pin – enough useful informoation so they can decide if they want to dive a little deeper.” The company’s Recipe Pins enable users to search by diet type or ingredients, bringing them recipes from across the web. “We’re trying to increase value for Pinterest users but this could be an area that makes sense for certain brands,” he said. Place Pins, launched mobile-first in November, are typically used for people exploring holiday destinations and enable users to assign places with Pin and build out a custom map.

Where are all the men?

But as a platform that has consistently attracted more women than men, how are they planning to get the less fair sex pinning? "We started out started with a female audience and that’s no mystery in the US. But our value proposition is about saving, organising and discovering content and I think that‘s universal. There are things we have to do to build more content for male and international audiences. We have seen great growth in health and auto and we are actively building those categories too. Travel is certainly a cross-gender category."

The platform is customised into 22 different languages at present, with country managers working in the UK, France and Japan to grow its international audience, currently around 20 per cent of users. “The growth rates are much more aggressive in international countries,” Alston revealed. In France, fashion bloggers are being targeted to build a community of people making original pins and repining items. "The top three pinners in Europe have followerships of over 3m a piece and their reach amplifies our community," he said.

“There is enough value in Pinterest – it’s just a question of how we go about going to market. There are lots of different ways to do it so we’re just being thoughtful. But I’m pretty confident we can come out with some format that makes sense for both brands and users.”

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