Pinterest is
basically an online pinboard that has gained immense popularity since its
inception 2010. It allows users to copy content from the web and pin it to a
personal board which can then be shared among users. It’s essentially an online
version of a scrapbook or photoalbum which enables the user organize and
collect images he cares about. That basic concept is enhanced by the ability to
pin all kinds of content and links and share the personal boards with the Pinterest
community.
Pinterest
follows the “Brokerage Business Model” that ultimately generates revenue by
connecting potential customers with sellers. For Pinterest that’s businesses in
the fashion, food or design market. The Pinterest users that make it
interesting for businesses to partner with Pinterest are mainly female, middle
class in prime earning age and with disposable income.
Social media
sites like Twitter and Facebook are key partners but also competitors. Pinterest
is ranked 4th of the most popular social networking sites[1]. In contrast
to the other social media sites Pinterest focuses solely on visual content,
which gives it an edge over the other sites, as the trend is more towards
sharing of visual impressions than text. That concept is also more attractive
for retailers interested in partnering with Pinterest because the unique use of
visual content enables businesses to present their products more effectively.
Currently
Pinterest doesn’t have a revenue stream. Nevertheless Pinterest is valued at
$2.5 billion[2],
which according to VCs is justified with the growth in users, and it’s unique
value proposition. The growing online traffic in combination with the described
features are compelling arguments for businesses to use Pinterest’s platform,
enabling Pinterest to generate revenue very soon.
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