Here’s the Completely Decoded Business Model Of Pinterest And How Its Successful

As one of the largest social media platforms in the world, the Business Model of Pinterest is something you ought to know!

Pinterest is one of the most successful social media platforms in the world, letting its users explore their interests in a fun and interactive manner and enjoy content curated especially for them.

The 3rd largest social networking site in the U.S, it has over 367 million active users all over the world as of 2020 and a customer base of 460 million people worldwide. It earned a revenue of $1,693 million in the year 2020 with over 2,200 employees working under it.

In order to decode the social media giant’s success, we have elaborated in full detail the business model of Pinterest – which includes its revenue model, value proposition, key partners and customers.

But before we start with learning more about the business model of Pinterest, let us start by glancing at more information on the company.

About Pinterest

Pinterest is a social media site for sharing and categorizing images from the Internet. The site is described as a visual bookmarking site in its content. Pinterest is short for Pin and Interest. They have many categories like food, fitness, architecture, etc.

It was founded in the year 2009 by Ben Silbermann, Paul Sciarra, and Evan Sharp – who are all ex-Google and ex-Facebook techies. It has its headquarters located in San Frascisco, California U.S.

Many people find inspiration for their lives and almost anything you can think of, such as new daily activities to try, dinner recipes, fashion styles to emulate, house remodelling ideas or preparing for a marathon, etc. 

Pinterest was very inventive in the way they made a hobby and interest exploration app into a platform that also acts as a mediator between seller and consumer. The platform is fast becoming a powerful base for marketers around the world to utilize and the company has been busy in order to keep on adapting the business model of Pinterest to make sure that their users are engaged. Pinterest also has effectively created a monetization model for its users and content contributors to keep growing the community and foster it. 

Recent News about Pinterest

Pinterest Has Just Rolled Out The Next Stage Of Its ‘It’s Possible’ Campaign, Highlighting Its Ability To Transform Ideas Into Reality

In September of 2023, Pinterest launched the latest phase of its “It’s Possible” global campaign, focusing on how people use the platform to discover new opportunities, places, and ideas. The campaign features different scenarios, like a couple merging “Retro” and “Forestcore” to create a “Disco Treehouse” decor and a young woman planning a tropical vacation. 

Barbie and Ken Take Over Pinterest

In collaboration with Warner Bros. Pictures, Pinterest launched an extension of their “It’s Possible” brand campaign. It puts the spotlight on the character of Ken and encourages users to embrace their distinctive aesthetic choices.

Let us now start learning in detail the business model of Pinterest.

Business Model of Pinterest

The business model is used to determine a company’s plan for generating revenue. It determines the products or services the business plans to sell, its identified target market, and any anticipated expenses.

Pinterest’s model is to help people find good recipes, images, and items and find more random pictures on the internet in one place. Suppose someone is interested in making money on Pinterest on a long-term strategy. They can start writing Blogs, work as a virtual assistant, and also be an affiliate marketer on Pinterest and many more

Let us now start detailing the business model of Pinterest by learning about its revenue model.

Revenue Model of Pinterest

Pinterest earns its revenue by charging on the ads they show. The person running the advertisement on Pinterest has to pay to Pinterest depending on the different types of advertisements it chooses. Some of the pricing methods of Pinterest are:

1. Cost per thousand impressions (CPM)
2. Cost per Click (CPC)
3. Cost per action (CPA)
4. For videos: Cost per View (CPV) or CPM

Let us now see the value proposition of Pinterest.

Value Proposition of Pinterest

The value proposition of any business defines the usage of the product or service offered by them, and it is the main driver behind the success of any business. In order to learn more about the business model of Pinterest, let us learn by exploring the value propositions of the platform to its users and businesses operating on it.

Value Proposition for Pinners (Users)

It provides users with the facility to discover different things through visuals to gain a better idea of the things they find. It provides its users with the most relevant content on the basis of different factors like their likings, tastes, ideas, etc. by using specialized algorithms.

A user can choose what it would like to see by choosing the specific category that they are interested in looking for at that moment or finding ideas for a particular project.

Value Proposition for Businesses

Pinterest tries to reach its ads to users which are in the right mindset and believes in it. Thus this increases the effectiveness of ads on Pinterest.

Most of the Pinterest users are in search of inspiration and ideas for planning new things and showing ads during this planning process is the best time to help its users by providing their services from related businesses. This makes it a better place for businesses.

Let us now see the key partners of Pinterest.

Key Partners of Pinterest

Pinterest is a platform that mediates between people who wish to learn more about hobbies or interests, content creators and businesses who wish to provide products that align with each user’s interests. Let us learn the crux of the business model of Pinterest by learning how these key partners interact with each other.

Content creators-

These are those people who have their small businesses and create content to showcase their products. They try to get organic traffic for their business.

Businesses/Advertisers-

These businesses and brands create content as well but they are more into advertising their products to the users than indulging in organic traffic. Some brands are into Pinterest so much that they create video and image content specifically targeted at Pinterest users.

Search Engines and Social Media Platforms-

Google and Facebook are partners as well as rivals. Ex. Google shows the images from Pinterest on its image search result pages. Whereas Pinterest allows its users to share its pins on Facebook.

Let us now learn more about the key customers of Pinterest.

Key Customers or Target Audience of Pinterest

The business model of Pinterest has two key players:

1. Pinners 
2. Advertisers

According to the data, 72% of Pinterest users are women followed by 19% of men. Therefore the key customers of Pinterest are women users. Pinterest calls its users ‘Pinners’. Blogs are called ‘Pins’. Those pins are customized and organized according to the user interests within the pinboards.

Pinners get this service for free where they don’t need to pay money. The business model is completely built on top of its Pinners, where they are the core for the business. 

More precisely, Pinterest claims to work on providing the “right” content for its pinners, using the following principles at its core:

1. Transparency
2. Enforcement 
3. Accountability 

Let us now have a look at the buyer’s persona of Pinterest given below:

Marketing Strategy of Pinterest

Pinterest markets itself as a visual discovery platform and targets users looking for inspiration. With its stunning visuals and personalized touch, it tailors its content to the interests of its users, making their experience unique. It also partners with brands, influencers, and content creators to showcase their products and ideas organically, subtly blending advertisements into the user experience.

Pinterest’s marketing strategy also involves empowering users to freely market their products and ideas. By letting users showcase their discoveries, Pinterest essentially promotes itself for free, tapping into the collective creativity and interests of its users. Essentially, Pinterest heavily relies on its users’ natural promotion to grow and gain visibility without traditional marketing tactics.

Let us now have a look at digital marketing strategies used by Pinterest in recent years:

It’s Possible Campaign:

It’s Possible is one of the most successful campaign by Pinterest and its been running for quite some time. It is designed to show users how easier it is to discover new opportunities, ideas, and places with Pinterest.

In the recent phase of It’s Possible campaign, Pinterest released many video ads showcasing the diverse possibilities available on Pinterest. The ads shows us how people are using Pinterest to plan and execute projects such as decorating their homes, planning vacations, and throwing parties.

One of the ads under the banner of “It’s Possible” is 90’s Party which shows us how a woman uses Pinterest to try various fashion trends from 90’s. 

As of now, this ad is one of the most popular videos on Pinterest’s YouTube Channle with 1.2 Crore views.

Apart from ads, Pinterest also launched pop-up shops in london as part of this campaigns where visitors could get beauty bar, create mocktails, and get a tattoos. 

Not Just Ken:

Not Just Ken is another great extension of It’s Possible campaign. For this campaign Pinterest partnered with Warner Bros. Pictures at the time of the Barbie movies launch. The campaign puts the spotlight on the character of Ken and encourages users to embrace their unique aesthetic preferences.

As of now, this ad is fifth most popular video on Pinterest’s YouTube Channle with 46 lakh views.

For this campaign, Pinterest capitalized on the trending searches related to “Barbiecore” and “Barbie moodboard. According to Pinterest data, these searches saw an increase of 980% at the time of campaign.

Top 5 Competitors of Pinterest

Google:

At first, Google may not seem like a competitor of Pinterest but when it comes to visual search and discovery, Google actively competes with Pinterest. It is still the first choice of users when they are searching for inspiration or visual content. Pinterest went so far as to identify Google as a direct competitor while filing to make itself public. Check out our detailed case study on the Business Model of Google to learn how it has become one of the biggest tech giants and competes with its competitors.

Instagram:

With features like Stories, Reels, and Explore, Instagram competes directly with Pinterest. While Pinterest prioritizes search and curation, Instagram directs its efforts toward enhancing content discoverability. With the launch of its shopping feature back in 2020, Instagram has now become one of the biggest competitors of Pinterest.

YouTube:

YouTube is not a direct competitor of Pinterest but with its vast library of instructional and how-to videos, it fulfills the same purpose as Pinterest boards, especially for DIY projects and recipes. Its long-form format content allows users to dive deeper and get more detailed explanations, making it a valuable resource for users seeking in-depth information. To learn how YouTube stays at the top of its game, check out our comprehensive blog on the marketing strategy of YouTube.

ETSY:

Being a marketplace for unique, handmade, and vintage goods, Etsy is another competitor of Pinterest when it comes to shopping and finding unique products. While Pinterest focuses on inspiration and discovery, Etsy allows users to directly purchase items they find on the platform. This gives ETSY a major advantage over Pinterest when it comes to the e-commerce side of the products.

Houzz:

Houzz is a platform where users can discover and take inspiration for home improvement projects. It competes directly with Pinterest in the field of interior design and home decor. It is a great resource for homeowners when it comes to finding design ideas and connecting with professionals in the home improvement industry.

 

Conclusion

On the study of the business model of Pinterest, we have seen that Pinterest is still growing and still has the potential to grow a lot in the market. It earns its revenue from showing ads to its users and chargest on different bases like CPC, CPM, CPA, etc.

It provides its users with different content on their preference, taste, ideas, etc. It also provide its advertisers with quality leads by showing their ads to people who are really interested and are in the right mindset

Pinterest has different partners like content creators, business advertisers, and search engines, and social media apps. They create content and use each other’s platforms to share the content.

Its key customers are Pinners and advertisers who use the platform and create content to post on their profiles and generate engagement.

Wasn’t it interesting to know the business model of Pinterest? Learn how to grow your business using digital marketing, by attending the Free Digital Marketing Masterclass by the Founder and CEO of IIDE, Karan Shah, to understand what digital marketing is all about.

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