Dive Brief:
- Pinterest is fundamentally changing its advertising model, moving away from fixed-price ads and launching a new process for marketers to bid on ad inventory via auction, according to Ad Age.
- The auction model has undergone testing with brands such as Home Depot, JCPenney and General Mills. The new model launched yesterday.
- The company is also adding frequency capping, enabling marketers to cap the number of their ads that a consumer will see.
Dive Insight:
Social media platform Pinterest always seemed like a natural fit for retail marketers, but never really took off. Lately, Pinterest has been reinventing its advertising and commerce capabilities to make its platform more appealing to marketers.
Pinterest has been actively rolling out new features recently, including visual search capabilities, a shopping cart that allows consumers to buy from multiple merchants with one cart, and three new ad targeting tools (visitor retargeting, customer list targeting, and look-alike targeting). Pinterest has also added Oracle’s Data Cloud to track platform visits to offline sales, a key metric for retailers in today's omnichannel world.
Pinterest's concentrated push into e-commerce is a move that retailers, manufacturers and marketers have long awaited. The moves bring the social platform closer to the functionality offered by major players Amazon and Google.
Pinterest's latest move to shift toward an auction bidding ad model comes as social media advertising becomes more performance-based. While brands on social media were previously more focused on broader brand awareness and engagement, marketers have shifted to a strategy of driving conversions in the form of clicks, lead generation and even sales.
"The main shift here is that Pinterest is making their inventory have parity with other inventory sources," Ben Clarke, president at digital agency The Shipyard, told Ad Age. "Marketers are used to being able to buy on a per impression basis and be flexible with CPM as well as set things like frequency caps. These changes make Pinterest easier to include in current media plans as an extension of the existing strategy rather than having to create a 'Pinterest only' buying model."
