Pinterest, the photo sharing social network has implemented a new future that will track the category of content you are pinning. When you visit a site about golfing and you pin the photo from the golfing site, Pinterest will know you are currently interested in golfing and then suggest other golfing related Pinterest boards to you. The new service sets the basic framework for a future advertising business.
In the process of pinning a photo to Pinterest, the Pinterest site will look at the source of the photo and using data mining, identify what type of website it is. Based on the category of the website they will then look through all the boards on Pinterest and find other boards in the same category. The matches will show up as suggested boards on your Pinterest homepage.
The basic idea is that if you are visiting sites and pinning photos of golf clubs, then you are going to enjoy seeing more photos of golf clubs from other Pinterest users. If this works it will increase user engagement. The more relevant the recommended photos, the more time you will spend on the Pinterest website.
For all social networks, a key metric is user engagement. Creating new ways to keep people on the site is one of the top priorities for engineering teams in social networks. In the race to profits on social networks, engagement is fuel. Advertisements are sold on impression and clicks, you can’t sell impressions if no one visits your site. And ghost don’t click banners.
That makes this change important for Pinterest. Categorizing the sites users visit, as opposed to the content of what they post, gives Pinterest the type of data that advertisers love.
Currently Pinterest can guess what your interest is based on the category in which you post your pictures. For example if you post a lot of pictures in the home decor category, then they know you are interested in interior design. If you post in the weddings category, you are probably planning a wedding.
So an interesting question is, if they have categorized content, why do they need to know the actual website you are visiting? Wouldn’t it tell them the same thing? You visit a wedding website and grab photos from that and then post to a wedding category, what value do they gain from tracking the actual website?
Tracking sites is important because otherwise you would need to take an action to be categorized for ad targeting. If you don’t actually post into a category they know what you are currently engaged in thinking about. Like twitter, people follow boards just because they saw one interesting thing. That doesn’t mean they are planning a wedding this month.
Using the new tracking style you don’t need to take any action for them to categorize your interest. You only need to visit a site with the Pinterest button installed. Even if you never post a wedding photo to Pinterest, but you visit a lot of wedding related websites that have the Pinterest button installed they can now identify what you are currently interested in.
Even if you only browse boards on Pinterest and never really get involved, they can still target you for promoted boards and promoted advertising from your browsing pattern on the web in general.
Once the technology is implemented, Pinterest will become a lot more personal. For example, if a guy was secretly browsing womens shoe sites and visited Pinterest later, he would find promoted images and boards about womens shoes on his front page.
This is the way the web works now, facebook, twitter, etc all track you and have the ability to deliver custom advertisements to you based on the sites you browse. The fact that Pinterest is tracking you isn’t the big news, it is the fact that Pinterest and taking serious steps towards monetization efforts that makes it news.
Previously it wasn’t clear how Pinterest planned to make money. For example, e-commerce could be one option. Whatever it ends up being, now we can see that advertising and targeted advertising is going to be a serious part of it.
Consumers always wonder how exactly social networks make money. They make money off their users data. Some way, some how they are taking all of the data they have gathered about you, especially what you do when you are not on their site. Then they are taking that tremendous amount of data massaging it so its easier for companies to target you based on some combination of everything they know about you.
While targeted advertising based on browsing is important for Pinterest, the key is going to be figuring out a way to get more data on users. That means offering more services and becoming a lot closer to what Facebook does than what Flickr does. That could be one reason why Pinterest recently hired Facebook’s former Director of Monetization to join the company.
Pinterest has also made noise recently about opening up their API to allow outside developers build on top of the Pinterest platform. These signs all point to Pinterest planning to expand the definition and reach of what Pinterest really means, but don’t expect anything interesting in the next twelve months. This is going to be a 24 month change.