Investors Take an Interest in Pinterest
A Growing User Base
Pinterest (PINS), a social media platform that gives people ways to share and search for images related to crafts and other hobbies, is making a splash on Wall Street. The company has recently seen its user base and revenue surge, which has boosted its stock price.
Pinterest’s user base increased by 39% year-over-year during Q2. The pandemic has kept people of many different demographics at home trying to entertain themselves with DIY projects. Pinterest reports that many of its new users are under the age of 25, or are men. It has also seen an uptick in international users. These are important gains for the platform, which in the past has mainly been popular among middle-aged women in the US.
Pinterest’s Ad Revenue Jumps
Pinterest also reported that its overall revenue was up by 50% year-over-year in July. Its ad business has been boosted as many companies boycott other social media platforms like Facebook (FB) and Twitter (TWTR).
Additionally, Pinterest specializes in direct response ads—advertisements which prompt viewers to do something specific, like make a purchase. These ads are often popular during times of economic downturn because they provide companies with measurable, fast results.
Ramping Up Ecommerce Operations
Perhaps the most important part of Pinterest’s success story is the growth of its ecommerce division. The company has been working to build its ecommerce operations for some time, adding features like a “shop” tab and “shoppable pins.”
Pinterest also launched a partnership with Shopify (SHOP) to help merchants upload their catalogues to Pinterest. Because of these new offerings, Pinterest says its business catalogue uploads went up by 350% between the first quarter and the second quarter of the year.
Pinterest is looking toward an uncertain back-to-school season. The site is very popular for teachers, and some of that traffic might drop off because of remote learning. However, parents teaching their children at home may also turn to Pinterest, which could make up for lost ground. Despite the many unknowns, one thing is certain: Pinterest is more than just a niche community for DIYers. It is developing into an ecommerce and advertising powerhouse.
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