To money and fame, I changed my name
And played a different game. – 2Pac
Pinterest, a company founded by Ben Silbermann and launched in 2010, is a free social network that has been an early favorite among a small passionate group of handmade DIY enthusiasts and has seen extraordinary growth over the years, now with major consumer brands using it of the one of the must-have social channels.
While it has been an amazing ride to watch, we at Makers Ring know that building your business on any external social network is inherently risky, such as when the platform matures and monetizes (or withers and dies with your data). While that risk shouldn’t discount an effort to build a presence on those platforms and to opt for growth (especially if you act early), it is something to keep in mind and to avoid relying too much of one’s business’s core growth and revenue on a platform’s decisions. This is as true for bloggers as for any marketers.
A few days ago, Pinterest announced a blanket ban on all external referral links. This decision disrupts affiliate networks such as RewardStyle and creates business continuation issues for startups like Hello Society, a network of influencers on Pinterest. In place of third-party referrals, Pinterest is launching its own service and inked a deal with Apple, a giant notable for its marketing ability. This is unmistakably a monetization effort by Pinterest to become a different type of social network. And it isn’t surprising.
A Precedent in Platform Monetization
There has been one notable precedent very recently. Think about when Sheryl Sandberg pushed Facebook into its current profitability. Brands and pages that had had tremendous followings were disenfranchised overnight and their posts are no longer visible to their followers (who had liked the page and opt to receive these posts).
Recent changes to Facebook’s news feed algorithm have brought about a significant decline in “organic reach,” the number of people who see a post that hasn’t been boosted by paid advertising. Two years ago, organic reach for many posts was at about 16 percent, but over the last several months it’s been throttled to 2 percent or even less. That means a typical post may reach only about 95 people unless the group pays money to boost it. – IBT, Facebook for Non-for-Profits
This monetization effort at Facebook was hasty and didn’t go over well. Users started complaining that their newsfeed is no longer filled with people and brands that they care about, and is filled with ads that they are not interested in. Facebook responded, to the users, and now sells few ads but at higher margins. To further appease users, Facebook launched ads relevance score for advertisers so that the users are better targeted.
Nevertheless, organic reach on Facebook no longer exists. If you are a brand, a blogger, or ecommerce business and this makes you feel oddly dissatisfied, unlikely losing yet another game of Blackjack in a Vegas casino, you are right. The house, in this case – the social network – always wins, unless you have a technical edge.
What You Can Do About Pinterest
At Makers Ring, we believe that Pinterest’s current monetization and current removal of affiliate links is an inevitable milestone for their business. However, we believe that the content providers should have some compensation, especially if they consistently share valuable content. And forcing them to pay each and every time while holding their audience captive isn’t the answer. After white-boarding and deep dive at our office over a long weekend, we’ve arrived at a workaround. A solution that allows you, the pinner, to keep your affiliate links, comply to all said rules, and still keep your commission. Do you want to find out how? Find out by working with us or attend our future workshops.
In the meantime, if Pinterest is your top monetization channel, this announcement at Pinterest will dramatically impact the way that you do business there. So make sure to consider Promoted Pins, Pinterest’s own referral linking service, and register for them here. Currently, this service is in closed beta, so sign up for your waitlist spot now. Like Facebook ads, the promoted pins will likely increase in price in future, so if you have to buy ads, do it early.