Why Pinterest’s Growth Has Stalled

We came across an interesting take on Pinterest today from Inc Magazine. They’re in the news lately after having raised $150m at an eye-popping $12B valuation but there are some concerns on the horizon, particularly around whether it’s an attractive platform for advertisers like ourselves to be spending our marketing budgets on.

Highlights from the article:

• “It is possible that Pinterest simply doesn’t have the massively broad appeal of its dominant competitors. Currently, outside of niches where it commands significant market share, like crafters and people planning weddings, the company is going up against competitors that offer superior products to both consumers and advertisers. Why spend your ad dollars on Pinterest when you could tap into Facebook’s richer data and bigger network?”
• “Pinterest is a “decacorn” that has 175 million monthly active users, many of them women with acquisitive tastes. The problem is that Pinterest is just not that popular by the standards of the digital platforms it’s benchmarked against. Consider that its close competitor Instagram boasts four times the number of monthly active users.”
• “In 2015, ecommerce platform Shopify told users, “Facebook dominates as a source of social traffic and sales. Nearly two thirds of all social media visits to Shopify stores come from Facebook. Plus, an average of 85% of all orders from social media come from Facebook.””

We personally think it will all come down to ROI, particularly for performance (read: sane) marketers who measure their conversions and cost per conversion. If all the big brands are out there throwing their ad dollars blindly at Facebook to build “mindshare”, then that will have the side-effect of leaving ad pricing on Pinterest low enough so as to make it a more attractive option, assuming the demographic you’re targeting matches what Pinterest offers.