How Pinterest Must Adapt to Conquer Global Markets
In the past six months, Pinterest has gone from relative obscurity to exalted status alongside Facebook and Twitter as a social-networking site that U.S. retail marketers need to pay attention to. While the social-bookmarking site has largely been propelled by a female, Midwestern-skewing audience, now that it's looking to make itself known abroad, it's likely going to have to find a different user niche in each new market.
Pinterest signaled its intention to focus on global growth when it revealed its choice of the Japanese e-commerce giant Rakuten to lead its $100 million funding round last month, saying the investment was the beginning of a strategic partnership "to help [Pinterest] expand in Japan and into Rakuten's 17 other global markets," according to a statement. The roughly 40-person company added a new hire in April who has a focus on "international growth," according to her LinkedIn profile. And it's also embarked on a project to crowdsource translation of the site into other languages, starting with Spanish, French, German, Portuguese and Japanese.
The push to enter new markets is likely being driven by the emergence of clones such as Pinspire, a near replica of Pinterest that was developed in a Berlin-based incubator, and a plethora of Chinese knockoffs such as Moguije, Fa Xian and Meilishuo. But Pinterest's U.S. growth, while still strong, is cooling, which could be another reason it's looking to ignite usage in key markets abroad. (Pinterest declined to comment on its international strategy.) Unique visitors to Pinterest in the U.S. grew from 18.7 million in March to 20.2 million in April, an 8% increase, but down from the period of hyper-growth between January and February when unique visitors climbed 72%, according to ComScore. Meanwhile, growth of unique visitors outside the U.S. is still in double-digits (21% between March and April), but Pinterest's non-English speaking audience remains small.
Nearly 80% of its audience of almost 30 million is in the U.S., the U.K., and Canada, according to ComScore. The No. 4 and 5 markets are France and Brazil, which respectively had just 540,000 unique visitors and 301,000 in March. Marketers such as telecom company Orange France and the Brazilian divisions of Volvo and Tresemme are already starting to trickle onto the platform.
While Rakuten hasn't revealed any specifics of how it intends to help Pinterest, integrating the "Pin It" buttons across subsidiaries in countries such as France, Germany and Brazil could be a way to introduce consumers to the service, according to Neel Grover, CEO of U.S.-based Buy.com, which Rakuten acquired two years ago. (Buy.com already has "Pin It" buttons deployed.) He also thinks it can help Pinterest fend off copycats.
"Although there's certainly an opportunity for regional Pinterest-type clones to emerge, what they will be lacking is the overall global strategy that Pinterest is now investing in," said Mr. Grover. He also pointed to a future business model for Pinterest, noting there are "strong synergies for discovery commerce" between the two companies. "By partnering with Rakuten, Pinterest will have access to one of the largest online marketplaces in the world and will therefore be able to grow their international user base through this network of savvy online and mobile consumers."
If Pinterest is eyeing Japan now, it's not the first social-media company with global aspirations to do so. Twitter made Japan the second foreign market where it launched its ad products last October and prior to that its international strategy team had focused heavily on increasing consumer adoption in the smartphone-crazed country, largely through integrations with mobile partners. While Pinterest has an iPhone app, the immersive canvas it's known for is still best experienced on a desktop, which could make it tricky for the platform to take off in Japan even when the user interface has been translated.
"Pinterest is mainly a PC platform, and the success for any social-networking site to break [out] in Japan will be whether or not it's highly accessible from a smartphone," said Peter Moody, managing director of Profero Tokyo. He noted that there are already some early adopters on the platform, including the cosmetics company Shiseido, which has a page for the mascara brand Majorlica Majorca with 71 followers.
But according to Chris Thomas, BBDO's chairman-CEO for Asia, the Middle East and Africa, Japan seems like a logical next step for Pinterest since it's a visually-oriented and social-media-crazed country.
"The Tohoku disaster last year sparked a surge in use of social platforms, and this catalyst seems to have altered the way information is consumed in Japan for the long term, leading to a significant rise in users of social media," he said.
Part of Pinterest's challenge in breaking out in new markets might eventually be finding the sweet spot of users who will have an obsessive love for the platform. For example, while a pervasive use of the platform in the U.S. is to post home improvement and design inspirations, there's not nearly as much of a cultural interest in DIY in Japan, where renting a home is more common and housing units tend to be much smaller, according to Mr. Moody. Thus, Japanese accounts would likely be missing that content ingredient that has made Pinterest an enormous traffic referrer for DIY-oriented U.S. publications such as Better Homes and Gardens.
It's too early to say whether a particular demographic will rabidly embrace the platform in non-English-speaking markets where Pinterest has already gotten a toehold. In France, it seems to be appealing mostly to an audience of urban-dwelling early adopters, but more balanced in terms of the gender of users than in the U.S.
Meanwhile, in Brazil, some think Pinterest could be a phenomenon that fades into oblivion once the early adopters lose interest. According to Sergio Valente, president of DDB Brasil, Brazilians are much more likely to throng to platforms like Facebook, Twitter and Instagram where they can keep tabs on what their friends are actually doing as opposed to looking at images that can only broadcast what they like.
"We believe that the Pinterest space isn't so aligned with the spirit of Brazilians," Mr. Valente said.