You only change the game by committing to it
Image thanks to Brooklyn Morgan and Unsplash
A few months ago I was meeting with an executive at one of the world’s largest marketing software companies. We were talking about how our firm, Ahalogy, and his might work together on mutual clients. A few seconds into sharing our capabilities, he stopped me, scratched his head, squinted his eyes and asked, “Why are you guys only working on Pinterest?”
At this company, and each of its large competitors, Pinterest represents something like the 32nd social media platform to plug into their clouds. Today, as Pinterest announces its first Marketing Developer Partners, you will find these large social software firms, as well as a few that place Pinterest into a suite of “visual marketing tools” beside Instagram and Tumblr. We stand out in this list. At Ahalogy, Pinterest is the first and only focus of our efforts.
“Why are you focused on Pinterest?” and “What are your plans for expansion beyond Pinterest?” are the two most-asked questions that my co-founder, Michael, and I get from investors, partners, recruits and reporters. For some, it’s a risk assessment check; for others, it’s a desire to understand. This post shall serve as a something to point people toward when they ask this question in the future. I also hope to convince you, dear reader, that Pinterest is a marketing game-changer that we’ve been impatiently waiting for.
Pinterest is Search, Not Social
When you closely examine Pinterest from the consumer’s perspective — or actually start using it yourself — you quickly notice that it is more of a search tool than a social media platform. People choose to open the Pinterest app when they are ready to browse for ideas and plan for projects. Around 25% of the time pinners type into the search box on Pinterest. Even when scrolling through our home feeds, we are unconsciously scanning images and descriptions for relevant needs.
If you run an e-commerce website of any size, you know that search drives many times more sales than social media does. As a result, marketers put many more dollars into search. One analyst report shows the average advertising revenue per user for Google is $29.95, compared to $6.12 for Facebook and $2.66 for Twitter. Search wins because it drives both traffic and intent. Guess what? We’ve found Pinterest brings lots of traffic and intent, too.
Just like search engine optimization, successful Pinterest optimization depends on attention to the little things that mean a lot. Marketers that win take the time to crop images, carefully craft pin copy, and ensure their mobile landing pages are optimized — after all, 75% or more of the traffic from Pinterest is mobile. These are important, unique needs in Pinterest marketing, so we are focusing our company on solving them.
People Use Pinterest for Purchases
One could argue that Pinterest has potential to drive higher revenue per user than even this lofty Google number. Why? Because Pinterest is used in large part to plan and make purchase decisions. Sure, Google drives a massive amount of sales, but it is a very broad based search engine that must boil the ocean to meet the world’s need for any kind of information. This makes Google a great general-purpose search engine, but Pinterest trumps it in helping people discover and organize activities that lead to spending.
Pinterest has further purchase-driving potential because it is used by people as they change habits and enter new categories. Some marketers call this the “point of market entry.” Marketers love to invest dollars against these special but rare times in our lives when we are willing to try a new brand, or are looking to fill a new need. For example, there’s the free razor you get in the mail when you turn 18 years old (and need to start a shaving habit), and the free pack of laundry detergent when you buy a new washing machine (and are willing to try a new brand recommended by the manufacturer). This costs a lot more than a banner ad, but because such efforts come at the right place and time the ROI makes it worthwhile.
Pinterest is a point of market entry marketer’s dream. For a growing number of people, the first thing we do when we begin a new diet, plan a wedding, pick up a hobby, or prepare for a vacation is to start one or more boards on Pinterest. These very warm leads are just waiting for you to share useful content with them.
However marketers must open their thinking a bit and refrain from lumping Pinterest in with direct response budgets. People interact with brand content on Pinterest weeks or months before making a purchase decision. We will need better ways to measure ROI in Pinterest marketing, and it’s another need Ahalogy intends to fulfill.
Pinterest Enables Marketing with Meaning
For the most part, digital disruption has changed industries for the better. We increasingly get what we want, when we want it, in the forms that we want it in. This is revamping the world of advertising, too. We ignore most ads and tap “skip” more than ever. Over 150 million internet users employ a banner ad blocker. Millions of us choose to pay Netflix, Amazon, HBO and SiriusXM in lieu of free programming with commercial messages. Who wants to sit through unwanted interruptions when our time is more valuable and scarce than ever before?
In a world where it is increasingly difficult to win customers by interrupting them with advertising, the only way to move forward is to admit that it isn’t working and try a different approach. I believe that we must counter this trend by actually creating “marketing with meaning” — in other words, marketing that people choose to engage with, and advertising that itself improves people’s lives.
I wrote a book on this topic back in 2009. While I share a lot of helpful frameworks and examples in the book, I predicted in the final chapter that this vision would not become a reality until platforms arose to allow brand managers to create marketing with meaning in a repeatable, scalable way.
Pinterest is just such a platform. It offers brands a means to share relevant, useful content at scale, when and where people are planning purchases.
Even better: The Pinterest business model has complete alignment with what is best for both marketers and its users. This is a big difference versus other social platforms. For Facebook to grow, it must create new ways of interrupting your experience. The company continually weighs the user frustration and “ad load” that you see when you are checking out what your friends are up to. Too many ads, and use goes down. Too few, and investors get angry. We’re just the pawns in this numbers game.
But since Pinterest is all about content discovery — and brands have a right to win with content marketing — the better Pinterest makes its product for users, the better it will be for marketers, too. According to Pinterest, two-thirds of all Pins already come from businesses. Marketers are learning that the more useful their Pins are, the more bang they will get for their media bucks. This is a win-win-win for everyone, and we believe Pinterest will be the first platform to prove that B2C content marketing works at scale. That’s worth some focus, eh?
Paid Drives Amazing Earned Results
Perhaps the least-publicized but most unique benefit of Pinterest—it is the first marketing platform where paid media can lead to a massive amount of earned activity. In other social media, like Facebook or Twitter, sharing is a secondary user choice; we read the update or ad and must choose to click a share button. But with Pinterest, a social share automatically happens whenever something is pinned to someone’s board. According to Pinterest, Promoted Pins saw an average 30% bonus in earned (free!) impressions. According to this math, if you spend $1 million on Promoted Pins, you actually see $1.3 million in media value. Oh, by the way: Companies that work hard to optimize can see even better results.
Even better, this earned bonus does not stop when your Pinterest campaign ends. The Pins you promote at scale continue to sit on thousands of people’s boards. Clicks and Re-pins keep coming weeks, months, and even years later. Your effective CPM keeps dropping and ROI keeps rising with Promoted Pins.
We’re focused on Pinterest because our data-based insights, technology, and a high quantity of quality content can significantly improve marketing performance on the platform. We’ve built a company that is ready for a time when a brand is managing thousands of Pins and bidding on tens of thousands of keyword combinations. That’s when things get even more interesting.
Businesses Need Help on the Journey
The first lesson I learned as an intern in marketing at Procter & Gamble is that “Doing anything new is hard.” I came into the company in 1998 with an early passion for “interactive” (what we called “digital” back then), and I could not wait to help brands like Tide and Mr. Clean move their marketing into the 21st century. However, I soon discovered that its difficult to make changes in big companies. It takes time to get approvals, wrangle agencies, battle with legal, and figure out ROI.
We managed to test, learn, weed and feed marketing innovations. I was fortunate to be at the ground floor of both email and search marketing. It took years for companies to master email and search, but today they drive billions of dollars in marketing spending and many more billions in sales.
We believe that Pinterest is the next true game-changer in digital marketing, and like email and search, they require companies to lean in and learn new forms of creative, testing, measurement and management. Just adding a “Pin It” button to your website — or to your current social media software app — is not going to change the game.
Ahalogy is not in the business of pushing software at our clients and simply maximizing monthly recurring revenue. Instead, we start off with strategic guidance, provide frequent personal coaching to our clients, and offer assistance on everything from custom content creation to Rich Pin website integration. Sure, we’ve got killer software and a log-in for you, but we exist to help marketers crack the code no matter what it takes. We call our approach “SaaS Backwards”.
In addition to helping brand marketers with our expertise, our focus and insights give us ideas to bring to Pinterest itself. We’ve got 50 people and counting who do nothing but work on Pinterest marketing all day. As a result, we’re able to represent what companies are looking for, as well as disseminate best practices and guidance from the partner team at Pinterest across all of our clients at once. This is a lot harder to do when Pinterest is just one of 32 platforms that your software supports.
Focus Drives Innovation
Strategically-speaking, a company can enter a market either by doing lots of things pretty well or one thing better than anyone else in the world. The former is difficult, especially in a very crowded marketing software space. So we think we can lead a successful, scalable business by doing Pinterest marketing better than anyone. As described above, Pinterest is definitely worth doing well.
A funny thing happens when you “burn the ships” and force yourself to focus on one area: You see ideas for innovation that others are unable to envision or understand. Shortly after founding our company we saw that a combination of quantity and quality of content was the number one driver of success. We spoke with brands and heard that they lacked the content to win at scale, and their legal teams were reluctant to pin to outside sources. We realized that if we wanted to have a successful Pinterest marketing company, we had better figure out a way to solve this content sourcing issue for them.
This challenge led us to create our industry-first Content Network. We work with top publishers in Pinterest-focused categories to provide brands with a licensed source of content — organized by category, keyword, and historic performance. Today, this has ballooned to over 600,000 images and articles at the fingertips of brand pinners. And because so much traffic comes from Pinterest to our publishing partners, we are able to glean data-based insights that go far beyond other players in the market.
Innovation through focus is a model that worked for Buddy Media, which spent years becoming the leading Facebook marketing player. ExactTarget rose to IPO on the back of email marketing. Interestingly, SalesForce.com acquired both of these focused companies — not because they promised a do-it-all marketing platform, but rather because they were the best in the businesses at their fields of expertise, and had parts to make the SalesForce.com whole even better.
Ironically, our focus on Pinterest is leading us to discover opportunities to make an impact far beyond this platform. In our drive to win on Pinterest and create a performance-based solution from end-to-end, we’re now touching the marketing process at the point of creative production and optimizing content experiences after the click. We’re following a product development mantra of “making it easy to get better results.” It is a model ready to disrupt bigger technology players.
Ours for the Taking
In some ways, Pinterest is only now scratching the surface of the potential that Michael and I saw when we launched Ahalogy from his basement in October 2012. Back then we stood in front of investors and took turns explaining what this “Pin-interest” thing was all about—and how it might change the world. We longed for the day when we could get API access, a partner program, and a paid media product. Now they are here, and we cannot wait for what’s next.
We are so thankful for the investors, partners, clients, and employees (plus their significant others!) that have joined the journey with us so far. You all believed we were onto something, too, and now we are on a mission to make a dent in the marketing universe together.