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Analyst to Pinterest: Go ahead with the ads, but be careful

Promoted content that is tasteful is a good idea for Pinterest, one analyst said

By Zach Miners
September 20, 2013 08:06 AM ET

IDG News Service - Pinterest already makes nice with outside businesses to better connect them with its site, but the social network is now thinking about consummating that relationship with promotional content.


   Pinterest Logo
The Pinterest logo.

And that's okay, as long as the content is integrated tastefully and does not stick out like a sore thumb as banner ads might, one analyst said.

That's the stated idea behind a new experimental program Pinterest described Thursday that would promote certain content on its site from a select group of businesses.

The amount of funding Pinterest has generated from outside investors is difficult to pin down. But the program was characterized as an effort to help make sure that the site "will be here to stay," CEO Ben Silbermann said in a blog post.

And if the site carries out its plan the way it says it will, users will stay too, said Rebecca Lieb, an industry analyst with the Altimeter Group.

Pinterest is a site that lets users post different types of visual content including pictures of retail items, recipes, ideas for event planning, or inspiring photographs. It's not so much a site for creating content, like Tumblr or YouTube, as it is for organizing it.

The site already offers a tool to help users easily incorporate content from outside businesses into their feeds -- the "Pin It" button. Pinterest lets businesses place the button on their website or mobile app, and when a Pinterest user clicks on it, they can post content such as photographs directly from that site to their Pinterest feed.

The site also offers analytics tools to help businesses see what type of content is getting the most play on Pinterest.

The experimental program Pinterest described on Thursday, which it is calling "promoted pins," is an extension of those efforts. Pinterest says these pins will only appear if they are relevant to the user, and will be marked in some way to let users know that they were paid for. As part of the experiment, the first promoted pins will be free to participating businesses, the company said. Pinterest did not identify the experiment's participants.

For example, Pinterest said if a user does a search on the site for "halloween," the person might see a pin for a Darth Vader outfit from a costume shop.

Promoting that type of content is a good idea, Altimeter's Lieb said, as long as it doesn't cheapen the user experience or distract people. Plus, it's due time for Pinterest to start doing more with advertising to demonstrate value to its investors, she said.

"Pinterest is not a charity, it's a business," Lieb said, and venture capitalists want their pay day. "They have to monetize their site, one way or another."

Reprinted with permission from IDG.net. Story copyright 2014 International Data Group. All rights reserved.
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