Two years ago Pinterest founder Ben Silbermann spoke at an L2 Innovation Forum we hosted in New York City. At the time the idea for a network founded on our tendency to collect fascinated me, but I have to admit I didn’t get everything right about the emerging social network. Let’s take a look at what I got right, and wrong, about Pinterest.
Pinterest May Be More Important Than We Think
Or, The Inevitable Rise of User Generated Content
Back in 2010 I wrote that Pinterest is an “artful haven” that “operates outside of niches” where “members can express themselves through all objects:”
“Regular netizens become brand advocates for self expression and objects tell stories. These collections go on display for all to see, and friends, friends of friends, and anyone at all can search for people’s “pins” by tag, person, curated lists and more. This all matters because, as Ben says, “people are discovering things through people.” People want to know what their fashionable friends are getting, and in this way brands can earn authentic levels of influence.”
So far sounds about right, but I wish I would have spent more time explaining what I think this means for the Internet as a whole. Although the benefits of Google are unmistakeable, manually curated sites like StumbleUpon and Pinterest are shifting our focus away from search toward discovery.
Notice Facebook has never optimized their search all that well? This isn’t blind omission, it’s in my opinion, by design. After all, Facebook doesn’t want you to arrive at your final destination in the time it takes to search something? They want you to filter through your feed and get lost in the wormhole that is Facebook.
This is significant because all of this is at the hand of the user. In other words, more and more of us are getting used to creating and sharing content. This is a pivot for the entire Internet and the businesses that truly understand this will benefit tremendously.
Pinterest’s Revenue Model
Two years ago I predicted Pinterest would earn their money through pinned products, but I didn’t realize that a network so focused on the social sharing of products would be so hesitant to monetize the platform. I also predicted (wrongly) that Pinterest would develop into a sort of commerce platform:
“And looking even further into the future, how will curated collections link to eCommerce? For now that Burberry tie BradfordC loves so much only exists as a link to the actual Nordstrom product page. In a world where Facebook is becoming its own eCommerce presence, I envision a Pinterest that sells products directly and without the middleman.”
As it turns out, Pinterest experimented with affiliate links but withdrew them when the media discovered they were taking a cut of site referrals resulting in a purchase. In this regard I was dead wrong, but my strategy wasn’t too far out in left field. As it turns out, a Pinterest competitor named The Fancy just released an ecommmerce platform that’s exactly what I envisioned for Pinterest.
Pinterest Competitor The Fancy’s Revenue Model
First, what is The Fancy?: In case you’re unfamiliar with The Fancy, it’s what I would call more of the tastemaker’s version of Pinterest. The platform is more minimal and the interface is less distracting (the literal Pinterest pin board makes total sense and caters specifically to newbies, but it’s never done it for me).
PPR invested $10 million into The Fancy last year, and while Pinterest has attracted an average of 3 pins per user, the average The Fancy user has 66.8 fancies (aka Pinterest’s version of pins). Still, The Fancy’s 250,000 member user base pales in comparison to Pinterest’s user base of 11,000,000.
Yesterday The Fancy announced that they would literally sell items from the platform. When items catch on the platform said they would contact retailers in hopes of partnering for a retail opportunity on the site. While affiliate links made sense to me with Pinterest, I still think this is an excellent plan to monetize a pinning platform.
Finally, Another Prediction
In my mind, sites like Pinterest are blazing trails for a new set of highly filtered and/or curated e-commerce sites. Standard reviews sites used to be enough to make affiliates a good living, but today money making platforms will require a people-oriented and/or technological edge. Sites featuring social curation (e.g The Fancy and Pinterest) or store filtering through the top rated Amazon products, for example, are the future.
The days of slapping the right keywords on a page and hoping people buy are over, but it’s giving way to something much more exciting. After all, social has hit and it’s changing everything.