Bulletin board website Pinterest has been popular since its creation four years ago, but nobody imagined the site, which earns only a small bit of revenue, could end up being worth $5 billion dollars. How did Pinterest amass so much money?
Investments have increased the net worth of the website, and now, Pinterest is one of the richest startup sites in the entire world. The company has received a wide variety of investments from various firms around the world.
Why Should Marketers Care About Pinterest?
Why is Pinterest so important to us, as marketers? Though the website did not include company ads at first, it is now letting advertisers take out ads on the site. Though the ads are extremely costly (a million or more for a few months' worth of ad space) when you consider how much traffic the website gets, major advertisers are going to be getting a boost worth the cost of the ads. Why? Pinterest can afford to charge more for ads than other popular websites, including Facebook, because Pinterest is linked to actual product purchase. When consumers see a product they like and "pin" it, they may end up purchasing it, which makes Pinterest an in-demand site for companies to place their ads, no matter how costly. These new advertisements are called "Promoted Pins."
What Is Pinterest’s Guided Search?
Pinterest is planning to expand its content to include a search engine that filters pins for users. The company also plans to expand internationally to bring Pinterest to even more users around the world. The new search engine, called Guided Search, uses visuals to direct consumers to specific products based on a general search query. What else will Pinterest do with its newfound wealth? The company plans to invest in tech applications, too.
So why are investors so eager to pour millions of dollars into a company that makes such small amounts of revenue? Mostly because the site has a vast amount of growth potential; this could be very beneficial down the line. Since the site continues to grow as far as the number of users and the number of pinned items, the website's future looks very bright, which is very attractive to investors with purchasing power.
How Can I Make Pinterest Work For My Business?
Pinterest isn't just a bulletin board or scrapbooking site; it's a way for other consumers to discover your products, whether it's clothing, cooking tools, fitness equipment, electronics, and anything else under the sun. When users click on a pin they are interested in, it is linked to the site where they can purchase the item. This is the main reason advertisers want to get on the site, and this will increase traffic to their online stores, which makes everyone happy.
Essentially, the money will help make the site even more user-friendly, more accessible for everyone, and an even better place for advertisers and investors to pour their own money into, with a high potential for payoff in the end.