After more than four years of operation, Pinterest has finally decided it’s time to make some money.
The social media company is beginning to sell ads — what it’s calling “promoted pins” — to select marketers from companies like Gap, Kraft, Target, and ABC Family, Pinterest said today.
Originally announced in September, promoted pins will now begin to show up in Pinterest’s search and category feeds. The native ad unit is intended to be “tasteful, transparent, [and] relevant,” said product manager Julie Black on the Pinterest blog.
Pinterest is calling this initial ad rollout a “test.” It plans to open up the platform to more advertisers later this year.
“We plan to eventually make Promoted Pins available to lots of businesses, but for now we’re working closely with a small group of partners to learn as much as we can and incorporate their feedback into our future product plans,” Steve Patrizi, head of partner marketing for Pinterest told VentureBeat.
“I think there has been a lot of pent-up demand for advertising on Pinterest,” eMarketer analyst Debbie Williamson told VentureBeat. “The wide range of partners they are working with is evidence that Pinterest has appeal beyond retail advertisers.”
The social scrapbooking site hasn’t rushed to make revenue, focusing instead on building its user base. Pinterest has become a sizable force in social media, attracting around 34.9 million monthly unique visitors last year, according to data from research firm eMarketer. About 86% of those visitors are female, eMarketer told VentureBeat, and 75% of that usage occurs on mobile device, according to Pinterest. That female-heavy audience may keep some advertisers away, noted Williamson. (Translation: Don’t expect to see Budweiser ads on Pinterest any time soon.)
With a substantial audience in place, Pinterest is asking for major commitments from prospective advertisers: between $1 million and $2 million per campaign, according to AdAge. That puts Pinterest’s CPMs (cost per thousand views) at between $30 to $40 — an aggressive price point compared to standard web advertising, or even other social ads. Pinterest declined to comment on its pricing.
Social advertising is becoming an increasingly large part of the overall amount brands spend on advertising each year, climbing 46.2% last year to reach $4.56 billion total, according to eMarketer. Facebook commands a massive 72.4% chunk of that sum, while Twitter has roughly a 9.2% share.
Pinterest, which raised $564 million in venture capital without earning a dime, is aiming to join the revenue leaderboards alongside those two social giants. It has a solid chance, too: Pinterest is a prime vehicle for advertising. Unlike other social sharing services, people explicitly use their Pinterest boards to save items they would like to buy.
“People who use Pinterest are in discovery mode, and that’s a prime time for them to be influenced by advertising,” said Williamson.
“I expect that after this initial set of partners there will be a lot of interest in advertising on Pinterest.”