Cannes Lions—the Science and Technical Oscars of the French Riviera—can be an embarrassing trip for American tech executives trying to woo advertisers. Not so with Pinterest CEO Ben Silbermann, who managed to reverse "the roles of supplicant and master" because he always knew he wanted to run a profitable business.
A few weeks earlier [Silbermann's] social media service, especially popular with women and hobbyists, began experimenting with selling ads to show to its 70 million users. With more demand than it could satisfy, Pinterest had limited its test to a mere dozen sponsors, wringing commitments of more than $1 million from each.
Stoute was desperate to get his newest client, discount shoe store chain DSW, into the program (fashion is the third-most-popular type of content on Pinterest). "I didn't want this thing to go by without us getting in front of it," he says. Fortunately he had an in: Stoute's drinking buddy that night was Ben Horowitz, whose venture capital firm, Andreessen Horowitz, had just participated in the $200 million funding round that had propelled Pinterest's on-paper valuation to $5 billion. Horowitz called Silbermann over, and Stoute ordered rosé for everyone, raised his glass toward his new acquaintance and offered up a paean of praise and blessings: Rise above, be great, stay great.
All hail Silbermann, maker of money! But it doesn't stop with advertising. Pinterest's "Buy" button was but a taste of the potential e-commerce riches that come with capturing aspirational intent, says Forbes:
For now advertising is Pinterest's only revenue line. But it requires only the tiniest leap to conjure a scenario in which the company acts as middleman for the hundreds of thousands of retailers already showcasing their wares on its platform. "The next step will be how do we make it really easy for you to go out and buy that ring or take that trip," says Silbermann. This is Amazon's turf, but Facebook and Twitter have been making incursions, with both companies conducting tests of "Buy" buttons for frictionless shopping. Pinterest, though, has natural advantages in e-commerce, with independent research showing its users are more likely to share product links and make big purchases than users of other social platforms.
If Pinterest is going to lay claim to the future, it will have to knock off a pretty formidable incumbent, Google, which is also in the business of harvesting signals of intent and selling them to marketers. That's the basis of its search advertising, the engine that drives roughly two-thirds of the company's $55 billion in annual revenue.
Silbermann, who spent two years as a product specialist in Google's advertising operation, knows what he's up against. For all his midwestern diffidence (he was raised in Des Moines), he's not shying away from the confrontation. In his Cannes keynote Silbermann dismissed Google as "the ultimate card catalog," an outdated technology useful only if you already know what you're looking for.
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