Business Model Canvas: Pinterest

Business Model Canvas: Pinterest

Executive Summary:

 

Pinterest is set up as a multi-sided platform business model.  On one side, Pinterest provides consumers the opportunity to find interesting images online, store and categorize them. Users can see what posts and other information is listed in a particular category. This creates a community around different interest topics and is free for users to enjoy.

The other side of the platform is targeted to advertising and retail markets.  The value proposition for these customers is access to aggregate affinity data.  Since the content is user generated, there is significant value to advertisers in how consumers think about the products and categorize them.  Also, through this forum retailers are able to access a hard to reach market. 

Pinterest has a few different ways of how to generate revenue. After the number of users reaches a critical mass, the sale of affinity data will become the number one revenue stream. Today, the company is still building up the user base and figuring out how to analyze the data so that it would be valuable to retailers and advertisers. Other revenue streams include referral traffic & click through advertisement, and paid for advertisement. Pinterest has a user base of about 55 Million people and makes about $0.93 per visitor to the site. 

The cost structure for Pinterest is relatively inexpensive. The distribution channel is through the internet and the primary costs are surrounding the computing and development.  The key activities for Pinterest to continue to grow will include gaining expertise in big data analytics and developing key partnerships. More than half of the Pinterest users access the site through a mobile platform so developing strong relationships with mobile partners, software and hosting companies will be important to their success. Pinterest is a great company and is well positioned for success.

References:

1. Brave, Scott. "Pinterest, We've Got a Business Model for You." Gigaom. Baynote, 24 Mar. 2012. Web. 20 Aug. 2014. <http://gigaom.com/2012/03/24/pinterest-weve-got-a-business-model-for-you/>.
2. "Ben Silbermann Pinterest Stanford Startup School 2012 Part 1 of 2." YouTube. YouTube, 21 Oct. 2012. Web. 20 Aug. 2014. <https://www.youtube.com/watch?v=5a8GskjPE0E>.
3. "Ben Silbermann Pinterest Stanford Startup School 2012 Part 2 of 2." YouTube. YouTube, 21 Oct. 2012. Web. 20 Aug. 2014. <https://www.youtube.com/watch?v=8FMqqYTCocw>.
4. "Press." Pinterest. Pinterest, n.d. Web. 20 Aug. 2014. <http://about.pinterest.com/en/press>.
5. Styles, Kirsty. "Pinterest: ‘There Is Value – It's Just a Question of How We Go to Market’ | Mobile Marketing Magazine." Mobile Marketing Magazine. Mobile Marketing Magazine, 10 Mar. 2014. Web. 20 Aug. 2014. <http://mobilemarketingmagazine.com/pinterest-there-is-value-its-just-a-question-of-how-we-go-to-market/>.
6. Harris, Derrick. "Pinterest, Flipboard and Yelp Tell How to save Big Bucks in the Cloud." Gigaom. N.p., 2 Dec. 2012. Web. 20 Aug. 2014. <http://gigaom.com/2012/12/02/pinterest-flipboard-and-yelp-tell-how-to-save-big-bucks-in-the-cloud/>.
7. Myers, Courtney Boyd. "How Much Does It Cost to Build the World's Hottest Startups?" TNW Network All Stories RSS. N.p., 2 Dec. 2013. Web. 20 Aug. 2014. <http://thenextweb.com/dd/2013/12/02/much-cost-build-worlds-hottest-startups/>.
8. "Pinterest, Twitter And Tumblr (Yes, Tumblr!) Are Starting To Steal Revenues From Facebook." Forbes. Forbes Magazine, 27 Jan. 2014. Web. 20 Aug. 2014. <http://www.forbes.com/sites/roberthof/2014/01/27/pinterest-twitter-and-tumblr-yes-tumblr-are-starting-to-steal-revenues-from-facebook/>.
9. Lomas, Natasha. "Mobile Ad Market Spending To Hit $18BN In 2014, Rising To ~$42BN By 2017, Says Gartner | TechCrunch." TechCrunch. TechCrunch, 21 Jan. 2014. Web. 23 Aug. 2014. <http://techcrunch.com/2014/01/21/mobile-ad-market-forecast-to-2017/>.
10. "ETForecasts - Worldwide PC Forecast." ETForecasts - Worldwide PC Forecast. ETForecasts - Worldwide PC Forecast, n.d. Web. 23 Aug. 2014. <http://www.etforecasts.com/products/ES_pcww1203.htm>.
11. "Online Advertising." Wikipedia. Wikimedia Foundation, 23 Aug. 2014. Web. 23 Aug. 2014. <http://en.wikipedia.org/wiki/Online_advertising>.