So everyone asks,
how is Pinterest going to monetize, (make money)?”
I’ve been thinking a lot about it lately, and here is my suggestion for how they could do it. A text-less, (think symbol system), reverse auction powered advertising platform. They could call it Adpins. Okay, let me walk you through it step-by-step…
(I hope lots of people start providing thoughtful suggestions, and of course, ultimately they probably have the smartest minds in Silicon Valley helping them figure it out, so they don’t need my silly chart (see the chart below), but it’s fun to put it out there into the universe anyway. Maybe when they do monetize I can look back and see if I was close.)
Bottomline, Pinterest has discovery LOCKED UP! Now if they can monetize and at the same time add functionality that serves their users, they’re going to be insanely successful. How could they do it? Here are a few ideas:
Create a few non-negotiable concepts, such as…
- Position an ecommerce option as a service to users – as a convenience – as a way to discover what you want, then get it for the best possible price. Pinterest would be our hero!
- Minimize visual clutter & use symbol system (shopping cart icon(s) ) to inform users that a shopping experience is available, (if they want it).
- NO TEXT…just 3 shopping cart icons as visual symbols that explains that a shopping experience is possible. (see my example below)
- By building an Adwords type platform, let’s call it ‘AdPins’, they can attract advertisers.
- They can easily copy the age-old reverse auction format. It is a format that is commenly used in e-procurement scenarios, and the goal is to drive the price DOWN so the customer gets the lowest possible price. And to be clear, the customer should be the Pinterest users, not the advertisers. It’s a race to the bottom, where the customer (Pinterest user) wins. This is a different model than Google’s Adwords system, which uses a version of a Vickrey auction format. And doesn’t relay to the viewer (browser) any element of ‘low cost’ benefits. It’s just some advertiser advertising. But a reverse auction benefits the shopper.
- By allowing just 3 shopping cart icons, with a 1st, 2nd, and 3rd, place ‘winner’ a competitive market develops which would drive the actual advertising price higher (for each slot) as competition to advertise on a certain product increased.
- The customer would know that the 1st shopping cart icon leads them to the lowest possible price. The 2nd shopping cart icon leads them to the 2nd lowest price, and the 3rd to the 3rd lowest. Again, in this way, Pinterest is the consumers hero.
- By allowing Etsy & small business sellers to use the AdPins System for adding links to their own items, they get a new & added benefit.
Yes, there are many technical problems, and challenges that would have to be worked out, I could list a whole bunch. Like:
- How do you identify a newly pinned image as a ‘New Canon 40D’ that is suitable for advertising? I don’t know.
- How do you ‘cut-off’ the affiliate link (shopping cart image) after a certain amount of time, so the Advertiser has a finite number of clicks or impressions? I don’t know.
- What happens when items get repinned? Do the shopping carts and affiliate links also get repinned? I’d guess yes.
- How do you handle ‘reputation of sellers’ ? And policing bad actors? Is Pinterest actively in the business of mediating disputes? (like EBay), Yikes I hope not.
Regardless of whether any of this happens or not, it’s fun to think about how ‘the fastest growing website in history’ can become the ‘highest valued website in history’. I believe it’s VERY possible.
Here’s my chart – pin it if you like these ideas…