Additional Update (2/15)Pinterest adds disclosure about how they (might) make money, my error about Skimlinks and a conversation with the Pinterest CEO.

Update (2/9): Based on the considerable converge that this blog post received, I have published a new post that shares what I learned.

I swore I wasn’t going to write about Pinterest again for a while after finishing a six part series of blog posts, but major developments keeping coming and no major news organizations seems to be covering them.

If you post a pin to Pinterest, and it links to an ecommerce site that happens to have an affiliate program, Pinterest modifies the link to add their own affiliate tracking code. If someone clicks through the picture from Pinterest and makes a purchase, Pinterest gets paid. They don’t have any disclosure of this link modification on their site, and so far, while it has been written about, no major news outlet has picked up on the practice or its implications.

Pinterest doing this is big news in my opinion for two reasons:

  • Pinterest is monetizing their site while in the early beta stage, which is almost unheard of for a newish social network.
  • Pinterest has taken this action in a quiet, non-disclosing way.

How long this has been going on isn’t clear, but it has been at least a month as Lindsey Mark wrote a blog post that mentioned it on January 5th. In my case, I saw a tweet from from fellow Lawrence social media user Debbi Johanning that linked to an article Why I Don’t Mind Pinterest Hijacking My Links. That blog post was based on a post by Joel Garcia on an affiliate marketing blog which pointed out the practice, but also explained that if an affiliate link was in the original pin, Pinterest wouldn’t modify it.

How Pinterest modifies its users’ links.

An example of Pinterest adding an affiliate link to one of @free's pins.

Pinterest is able to do this across their site by using the service skimlinks. This service is rather innovative in that they automatically go through a site and add affiliate links wherever there is a link to a product that has an affiliate program associated with it. While many forums, smaller web sites and even Metafilter have taken advantage of the service, I have to think that the volume of links skimlinks is modifying for Pinterest, has to make Pinterest their biggest client and perhaps the majority of their business. skimlinks makes money by taking 25% of any affiliate revenue generated.

Pinterest is taking the unique path of generating revenue early.

Historically large social networks have focused on user growth with little regard to making money. Twitter and Facebook went years before doing any advertising, and more recently, popular services like Instagram and to a lesser extend Path are almost dismissive of how they are going to make money. The idea of growing big and figuring out the business later is dangerous for small businesses, but in the world of venture capital, it is absolutely the norm for rapidly growing web sites and services aimed at consumers.

That Pinterest is breaking from this mold, and getting revenue while it is still technically in beta is news on its own. I wrote previously on how Pinterest could be the most valuable social network for retails sales, and in Pinterest’s case, they have found a relatively easy solution to start capturing the value of the network before they even leave their beta phase.

How they are doing it with no disclosure to users feels weird.

As most bloggers are aware, when you use an affiliate link in your post, you need to provide some type of disclosure either by it clearly being an ad, mentioning it is an affiliate link or at a minimum providing some type of prominent disclosure that your site features affiliate links. This is done, because you have a financial interest is promoting the product.

In Pinterest’s case, since they are not creating the content and are inserting the links automatically, they might feel that they are not promoting affiliate linked pins any more than other pins, and thus they don’t need to disclose as the placement is not affected based on the financial gain.

skimlinks own site has a FAQ section about disclosure, and it would seem their own recommendation would be that Pinterest make a disclosure.

We encourage our publishers to disclose to their users and comply with the FTC regulations which state… “When there exists a connection between the endorser and the seller of the advertised product which might materially affect the weight or credibility of the endorsement, such connection must be fully disclosed”.

When using our URL Shortener to include product recommendations on Twitter, we have provided some disclosure guidelines here.

You could also add disclosure to your site by joining our Referral Program and using one of our disclosure badges.

One specific, problematic issue is that when individual online stores pin their own content, it is unlikely they would insert an affiliate code. But if the store has an affiliate program, it is highly likely that those links now will have an affiliate code in them that gives Pinterest a percentage of any sales. Not disclosing this modification is putting individual stores at a disadvantage when they and their customers are putting in the work of adding pins.

I, like many people, don’t have a problem with Pinterest making money off of user content. The links are modified seamlessly so it doesn’t affect the experience. Pinterest likely should disclose this practice to users even if they aren’t required to do so by law, if only to maintain trust with their users.

Do you care that Pinterest is modifying your pins? Do you think they should disclose it to users? I would love to hear your thoughts.

 

Tagged with:
 

73 Responses to Pinterest is quietly generating revenue by modifying user submitted pins.

  1. avatar Lindsey Mark says:

    In my experience, they do in fact change the url of affiliate links, as written about here: http://gtomanagement.com/what-affiliates-and-merchants-should-know-about-pinterest-links/. They do however let you change it back to your affiliate URL. It’s an extra step and the skimlink persist if you get re-pinned before updating the new link.

    While as a user I don’t mind Pinterest making affiliate money, I do wish they mentioned it in the FAQ’s. I’d also kill for an API, but given the current model/strategy it’s likely they’ll continue the path of the walled garden rather than deal with 3rd party applications. Given the current momentum they have I don’t really blame them.

    Thanks for the pingback!

  2. avatar Josh Davis says:

    Hi Lindsey.

    Thanks for commenting. Your blog post seemed to have started all of the coverage.

    I did one test with an Amazon affiliate link on Pinterest (it was to a free book, so no revenue would be generated) and it got several repins. Even after all of that, the original affiliate link was still there. I haven’t tried with any other affiliate programs, so this may be unique just to them?

    If it is as you stated in all other case, I think that is particularly poor. Essentially then, a merchant can’t pin anything without Pinterest modifying the link.

    I agree that an API is unlikely. Given how a bot followed over 1 million users in a day, http://llsocial.com/2012/01/guy-who-follow-1-millon-on-pinterst-24-hours/ I don’t think they are ready for that.

  3. [...] already have stumbled on one way to bring in some revenue, albeit a somewhat sneaky one.Josh Davis, in a blog post Tuesday on a site called LLSocial, says that Pinterest has been modifying some “pins,” or links to the items that users [...]

  4. avatar JuurianChi says:

    Well, Duh.
    If you Share a pin from a Commerce site like Amazon you cannot blame them for trying to monetize a bit.

    • avatar Josh Davis says:

      As I state in the post, I don’t think there is anything wrong with monetizing. Most of the discussion I have had on Twitter indicates most people actually prefer this type of business model versus ads.

      I think the interest in the story comes from the lack of disclosure to users as well as the fact that it is interesting to see how a popular site like this is monetizing this early in the process.

      • avatar Wayne D. says:

        The only interest in this story is from your link-baiting title. Following yesterdays @Path kerfuffle, this is the latest round of bloggers stringing together conspiracy theories, searching for any crumb of perceived skeeziness.

        It’s this kind of speculation that is so attractive to the internet’s mob mentality and so damaging to budding tech startups and mobile platforms. Startups like Pinterest, Instagram and Path, with their new fragile platforms and growing teams cannot prosper if every move they make has their feet held to the fire like Facebook obviously should.

        If you don’t think there is anything wrong with monetizing links on a platform you yourself built, then why headline this article with ‘quietly generating revenue’? What business isn’t quietly generating revenue?

        Go build something.

        • avatar Josh Davis says:

          Hi Wayne.

          I think my title was pretty accurate. If I was using a link-baiting title, I could have certainly used “secretly” vs “quietly”. Based on the reaction to the post and coverage by at least 50% of the bigger tech/social blogs, I think the story is of interest.

          You make a valid point about start-ups needing to be able to grow and make mistakes. I don’t imagine that this story is going to hurt Pinterest at all. If they feel they need to make a disclosure they can. I do feel that whether the disclosure is a valid issue or not, the process of how one of the fastest growing social networks is monetizing is worthy of coverage.

          As for building something, I have content start-up that I spend 40 plus hours a week on in addition to my client and agency work. http://FriendsOfFree.com

          Thanks for providing a unique perspective with some valid issues to consider.

        • avatar Diane E says:

          Wayne, I agree with you completely. I think the Pinterest team have been quite innovative, generating revenue in beta. As long as no one else’s revenue is hurt, and no confidential info is leaked, who cares what goes on behind the curtain? “A girl’s gotta eat, right?”

        • avatar Thomas Bacon says:

          Wayne I think your criticism is unwarranted, the article was only mildly critical of Pinterest, and was more just a very valid analysis of a monetization strategy.

          I’d also point out it’s not “speculation” at all; it’s a fact that they are monetizing their links. All companies, whether startups or established; deserve careful scrutiny by users who turn over their data to them. I found this post to be very fair.

  5. avatar Jacinta says:

    Wonder if the guys over at Gentlemint have looked into this business model :)

    Obviously a whole different demographic but could create some revenue without hurting the user experience.

  6. I don’t see a problem with what they are doing, including the fact that it hasn’t been officially and clearly disclosed. As noted, this is still in a beta testing phase, and so they are still working through a great many things. I am certain that if the ToS does not indicate that they can alter the content posted, then it will very soon.

    I’ve been reading up on this, and it seems that there are people who are level headed, such as yourself, and feel that they should disclose this practice, in a FAQ, or some other method, but I’ve read come commenters that really seem to think this is a terrible sin or something.

    I find that problematic. We, as digital consumers, have a mentality that everything should be perfect 100% of the time and also be free. That is just not reality. Wikipedia, for example, is quite expensive to maintain, but doesn’t setup ad revenue and such. They rely on getting donations. The problem is, millions of users give absolutely nothing, assuming everyone else is giving, or that the cost of the service couldn’t possibly be as much as the people running it claim it is.

    We need better education about the real costs of the digital age. Servers aren’t free, people writing this code don’t do it for free.

    When it comes right down to it, if someone can come up with a way to give me a great service and not charge me directly, more power to them. That is normal practice in capitalism. If the service fails, then it doesn’t matter. If it takes off then getting to the point that they are off setting their costs early is only bound to make it even better.

    Disclosing how they are making money isn’t going to change the service and I’d rather see them focus on the things that affect the service first.

    • avatar Josh Davis says:

      Well put Nick.

      Aside from disclosing it in the FAQ or at least the terms of service, which isn’t a big time commitment, I am pretty excited about this means of monetization.

    • Pretty much sums up my thoughts exactly. Nothing is free…someone is paying for it, why not the end user? I love Pinterest for it’s practical applications for me to save things I love in a visual medium and I really love Pinterest because they are currently my biggest traffic generator. That they want to make some money while providing that for me? I say go for it.

      • avatar Tara Hunt says:

        It’s clearly stated in Pinterests TOU:

        By making available any Member Content through the Site, Application or Services, you hereby grant to Cold Brew Labs a worldwide, irrevocable, perpetual, non-exclusive, transferable, royalty-free license, with the right to sublicense, to use, copy, adapt, modify, distribute, license, sell, transfer, publicly display, publicly perform, transmit, stream, broadcast, access, view, and otherwise exploit such Member Content only on, through or by means of the Site, Application or Services.

        It can be found here: http://pinterest.com/about/terms/

        It is a pretty standard TOU across the web. And Skimlinks is used by many thousands of sites and bloggers:

        http://blog.skimlinks.com/2012/02/08/it%E2%80%99s-not-a-secret/

        I’ve even heard the founders talk about their business model openly.

        ++ to Nick The Geek for this:

        “I find that problematic. We, as digital consumers, have a mentality that everything should be perfect 100% of the time and also be free. That is just not reality.”

        It’s ridiculous. None of our favorite online tools (that still cost hundreds of thousands to millions of dollars to make believe it or not, let alone host all of those photos) would exist if they couldn’t implement a business model.

        You’d rather have ads or promoted brands? I think that would be more invasive.

        I should also mention that only a small percentage of pins are able to be converted to affiliate. Only pins directly linking to retailers will have the code embedded. Skimlinks does NOT provide the service of going into images and finding the product and changing the entire URL. Most pins are from blogs, Tumblr, etc. Those fluffy kitty or cute manicure pins? They aren’t monetizable.

        Pinterest owes us nothing.

  7. I think this is awesome, finally a high growth startup focusing on making some cash!

  8. avatar Joe Hall says:

    I think this is genius and other companies should be doing the same. In fact I argued years ago that Twitter should have done this to monetize their traffic beyond the site and into third party apps.

    Also something that others haven’t mentioned yet is if you add an affiliate link yourself, it stays in-tack. You can see this in action at a board I created here: http://pinterest.com/joehall/spy-stuff/ So, I say instead of harping on this as evil, join them and make some $$ along the way!

  9. avatar Nancy says:

    I personally would prefer this model to one whereby I am bombarded with ads. One thing I am beginning to find annoying on Pinterest are those pins which are clearly pinned by the seller in hopes of gaining more revenue. I use Pinterest as a visual corkboard for ideas to use in teaching. When I click on a pin which sends me to a seller’s page I resent the time wasted to get there.

  10. avatar Shaun Dakin says:

    I have no issue with the company trying to make money, I have a huge issue with their lack of transparency.

    While they have a large and growing base of fans (mostly women) who Love love love what they are doing, my advice is to get out way ahead on this and let their users know what they are doing.

    Now.

    Shaun Dakin
    Founder – Privacy Camp
    Founder – #PrivChat the Twitter Privacy Chat

  11. avatar Rick Calvert says:

    First off thanks for the link to our post Josh. Secondly I admire Pinterest and what they have accomplished as much as anyone, but disclosing affiliate links is a 101 thing.

    The fact that they are earning revenue and thought about this early on is a huge credit to them.

    Everyone makes mistakes and failing to disclose this is the first big mistake I am aware of Pinterest making. They should change their disclosure policy and continue building out their addictive empire.

    • avatar ewenique says:

      As far as Pinterest mistakes go, here is one that doesn’t sit well with me.

      http://ellemennop.wordpress.com/2012/02/07/annoyed/

      In short, Pinterest asked my friend, Elle, to hand over her username (which she’d been using since 2010) to Elle, the magazine – which coincidentally is @ellemagazine on twitter.

      I like Pinterest very much but feel this behaviour is despicable…and another big mistake of theirs. It’s just wrong on so many levels.

  12. avatar Josh Davis says:

    Some good discussion at Hacker News on this topic including from user tpiddy, who points out that an almost identical link modifying system was implemented by Posterous two years ago. They too didn’t disclose, but apologized once it was made public: http://news.ycombinator.com/item?id=3564977

  13. avatar Ben Syverson says:

    Pinterest users should be happy that the site can support itself without showing ads. Stores have gained an effective discovery platform. This is not duplicitous, and it hurts no one. So who cares if they disclose or not? No, seriously, who cares, other than tech bloggers?

    It says something about the tech world that the collection of money is now seen as more suspicious than the collection of personal data.

  14. avatar Aaron Klein says:

    Good for Pinterest. This “transparency” argument is baloney.

    Why in the world do we criticize an incredible FREE service for trying to cover their costs and make a profit?

    They shouldn’t gum up the product with silly notices and disclaimers. They’ve got it exactly right as it is.

  15. This is explained in their member terms “you hereby grant to Cold Brew Labs a worldwide, irrevocable, perpetual, non-exclusive, transferable, royalty-free license, with the right to sublicense, to use, copy, adapt, modify, distribute, license, sell, transfer, publicly display, publicly perform, transmit, stream, broadcast, access, view, and otherwise exploit such Member Content”

    • avatar Josh Davis says:

      Good find Sarah. I would say their TOS allow pretty much allow anything with that broad of language.

      Whether they should make a specific disclosure to users is still an issue, but certainly they can do anything they want with what we pin.

  16. reading further I think this may even be an FTC grey area, as the endorser is not Pinterest, so Pinterest aren’t recommending the product in any way.

  17. avatar adriana says:

    it’s perfectly fine with me.

    i can’t believe that there are people who are actually writing about this being a *problem*.

  18. avatar AC says:

    Correct me if I’m wrong, but isn’t it illegal in the US to post affiliate links without disclosure?

  19. avatar Mondomulia says:

    I agree with Lindsey as I don’t mind Pinterest making money potentially off my pins, but I would like this to be clearly written in their t&c’s!

  20. Good idea this. I think I might test out a few affiliate links on there, to see if they get modified. If they don’t it might see more affiliates try to use it, which might be a bad thing.

    Skimlinks could do well out of this pertnership, as long as it does not put too many people off using the service. But I guess most images will come from places with no affiliate scheme.

  21. avatar Janell says:

    What if I post a link to a commerce site with my own affiliate tracking code? Would they change that to theirs? Assuming that I followed the guidelines and disclosed that myself, I might have a problem with them changing that link…

  22. avatar Scott says:

    “As most bloggers are aware, when you use an affiliate link in your post, you need to provide some type of disclosure either by it clearly being an ad, mentioning it is an affiliate link or at a minimum providing some type of prominent disclosure that your site features affiliate links.”

    Says who? I don’t understand who makes these rules. They can do whatever the hell they want.

    • avatar Josh Davis says:

      Hi Scott, thanks for the post. The Federal Trade Commission actually has rules related to this, and some in the affiliate industry who didn’t disclose certainly have had action taken against them.

    • avatar Rick Calvert says:

      irregardless of the legality, it us unethical not to disclose affiliate links.

      It’s pretty black and white stuff. People should tell you when they are making money off of you.

      There is nothing wrong with Pinterest using Skimlinks, and certainly nothing wrong with them making money. They just need to make their users aware of it.

  23. I don’t get the idea that Pinterest is doing nothing wrong. Yeah, it’s great to have a site with no ads. But, changing your user’s content is the real issue. Your user has added content and put it up on your site. Everyone knows you have to make money somehow. But, changing their content should not be part of your monetization strategy. Sharing it, publicizing it, copyrighting it, even selling your user’s content at some point seem reasonable – as long as you tell them. Imagine if Pinterest pointed out quite clearly – we reserve the right to edit your content and make money off you. Do you think it would still be growing this fast? Neither do I.

    I also don’t buy the idea that Pinterest is safe from FTC regulation on this. By adding their own affiliate link, they are changing what someone else put up. They are no longer the neutral third party, but have become the party with an obligation to disclose financial gain.

  24. avatar Gregory Jackson says:

    I believe Pinterest should disclose.

  25. avatar Kittie Walker says:

    Good service, good business model, shame about the lack of transparency – but hey they just got themselves another whole lot of free publicity ;)

  26. avatar sinzone says:

    Facebook started to generate revenue on month #4. First ads contract was $2400; on May. Facebook closed the 2004 with more than $300,000 in revenue.

  27. Isn’t it illegal to offer affiliate links in this way without disclosing it somewhere on the site?

    I’m glad they’re doing it. It’s not negatively affecting anyone and allows them to monetize a great service, but there ought to be a disclosure.

  28. It’s great that Pinterest has implemented a monetization strategy early — but it goes without saying that the strategy should’ve been better communicated with users. If they were transparent with the affiliate links up front, they would’ve gotten mixed comments from the public. Now that this has been “uncovered,” this affiliate link tactic will be perceived much more negatively.

  29. avatar krisroadruck says:

    posts like this one really disgust me. “Oh no someone is making monies online.. lets make it seem like a bad thing.” What is up with this hater mentality seriously? They found a smooth way to monetize their site without drawing attention to it and thus distracting from the user experience… and that’s bad because… why?

  30. avatar Josh says:

    Wow! That’s genius of Pinterest. I do think the link change should be disclosed, though. I also think that it should be pretty easy for Pinterest to monetize if people don’t want the affiliate link to change.

  31. This is a great discussion, and we wanted to dive in as we are so proud of how popular Pinterest has become.

    It is worth bringing up that we work with many other sites in this way, and that this is a common monetization approach for many social discovery sites, and many content sites in general. We do encourage our publishers to disclose how they monetize, it is definitely best practise, and we provide guidance on ways to do this in our T&Cs. Pinterest has clearly stated in their T&Cs that they have the right to modify links and and content added to their site. They are driving immense amounts of new traffic to merchants sites, and providing a free and beautiful service to their users, uninterrupted by intrusive banner ads. This is great on all fronts.

    With respect to FTC rules on disclosure of affiliate links, the law is that any content creator that is *endorsing* or *recommending* something and obtaining financial benefit as a result of this endorsement, needs to disclose it. In this case, Pinterest are not pushing people to buy something because they get paid for it, they provide a platform that drives traffic to retailers and they are being rewarded for providing that service.

    For anyone that’s interested, we’ve written more fully about this topic here: http://blog.skimlinks.com/2012/02/08/it%E2%80%99s-not-a-secret/

    Alicia Navarro
    CEO – Skimlinks.com

    • avatar Josh Davis says:

      Thanks Alicia for commenting.

      I appreciate you posting your opinion on when disclosure is needed. I think it is consistent with with my post that it is unlikely that there is any legal requirement to disclose.

      The service you all are providing is amazing, and I admit that I was unaware of it and similar services before I started blogging about this issue.

    • avatar Rick Calvert says:

      Well done Alicia! The pinterest folks would do well to emulate exactly what you did here with your comment and your blog post.

  32. I’m a big fan of Pinterest and am using it for business purposes as well as recommending the site to my clients. I’m also in favor of Pinterest making money. That being said I don’t like the way they are going about collecting funds through affiliate links.

    If, hypothetically speaking, my customer puts a product on Pinterest without using my affiliate program I am slated to get full price for any sale. But when Pinterest inserts their affiliate link I’m now having to pay a third party. That is, in essence, taking money from the till. The fact that they are not telling me, as a business owner, in advance is, in my opinion, unethical.

    Perhaps they should clearly state this in their terms of service and remind people when they are pinning from retail websites.

    Not sure what the solution should be but I don’t think non disclosure is the way to go about it.

  33. avatar Jen says:

    1. I respect that Pinterest must cost a lot to run and they need to make money somehow, and 2. I like that it deters people who would abuse Pinterest solely to earn affiliate income rather than contributing quality content. It’s a smart decision.

    As for the disclosure thing…it doesn’t bother me. It’s a hugely popular commercial website and I assumed from the beginning that it wasn’t created purely out of the kindness of someone’s heart. People should be wise enough to know that there’s no such thing as a free lunch. If they were sprinkling in their own pins among the user-generated content, I might feel differently.

  34. I love me some Pinterest. But I can’t say I love this bit about it.

    It’s definitely smart for them, but kind of icky for the curators who make their income off of affiliates links and may have been unknowingly driving their sales to Pinterest instead of their own.

    Would like to see a disclosure…also wondering if they’re changing the target of the link to affiliate sites, or only adding affiliate data to links already pointing at affiliated sites?

  35. avatar MJH says:

    Thanks for this post. I, like most other people here, am aware that ‘free’ services need to be monetized in some way. The complaints that people are making are not about a site making money. That is not the issue. The complaint is in the lack of transparency. More popular social networking sites have transparency built in, in that you see an ad, you know that the company is making money from your click, should you choose to do so. What’s disappointing about this is that Pinterest has entirely mislead their users. There is no way around that. Posting a link anywhere is done so with the understanding that the link will be presented as you originally intended. To modify that link without the user’s knowledge is, at best, ethically wrong, and at worse, illegal. It has been pointed out that there are no legal issues here, so no problem for Pinterest. But as a user (just deleted my account), I have to say that I’m really disappointed in the way that they have handled this. Look, I make my living as a digital marketer. I love the idea they had, I think it is an absolutely stellar way to monetize a site; seamless, with no page interference, like what happens on Facebook. But the fact that they have done this surreptitiously is really creepy, and I will not support it. A little transparency goes a long way. Maybe I’m being hypocritical, but I think this sucks.

  36. A company pinning it’s own products is basically a form of advertising. They’re using Pinterest’s service and server space at no cost. Maybe Pinterest should get a cut of profits then.

  37. avatar Wade Kwon says:

    I disclose all of my affiliate links. Why can’t Pinterest?

  38. avatar Nick Gilbert says:

    Disclose what exactly? They have nothing to disclose. What they’re doing does not affect the user in any way. It doesn’t even have a privacy implication.

    Affiliate schemes on the internet are widespread. Most people have clicked on hundreds of affiliate links without even knowing. Sometimes even normal links with no tracking information are used the same way (through the browser’s referrer headers).

    There is no news here and nothing new is happening. I’m surprised you think the media will be interested in this when this has been going on for 10+ years. It’s old news – nearly as old as the Internet.

    • avatar Josh Davis says:

      Nick, thanks for the comment.

      The story got picked up by CBS News Online, TechCrunch, Mashable, New York Times and dozens of others publications who did stories based on this post. So I would say the interest is certainly there.

      I worked in the affiliate industry from 2000-2002 so I agree with you that affiliate programs have a long history.

      The unique part of the story is that it was largely unknown that Pinterest was monetizing, and how how they were doing it. Since Pinterest is one of the fastest growing social networks ever, many people are naturally interested.

      Whether disclosure is an issue or not, about 40% of the comments I am seeing, especially from actual Pinterest users, say they would like disclosure of some type.

  39. avatar Carolina Clover says:

    As an ecommerce site, who is pinning and has an affilate program there is NO WAY pinterest can modify there links to gather affiliate sales because we have to physically approve them to do so — then again we are not Amazon where that sort if thing might go unnoticed.

    • avatar Joel Garcia says:

      Carolina, this isn’t exactly accurate. You are correct that every merchant has control over which affiliates are approved into their affiliate program. However, if a merchant has accepted Skimlinks as an affiliate, then any pins made that send traffic directly to the merchant domain will be converted to affiliate links behind the scenes as the click transfers a visitor from Pinterest to the merchant site. This is how the Skimlinks service functions and it is widely used on thousands of websites to monetize traffic to great success. There is nothing wrong with this, but Pinterest should disclose that it is doing so, in my opinion, so merchants can make use of Pinterest as an excellent traffic generator, knowing the cost of doing so.

  40. avatar Priit Kallas says:

    Great post! I actually thought about the same method of monetization. Nothing wrong with it, but they should be a bit more open about it.

  41. avatar martin says:

    I wonder after reading most of the comments whether anybody actually has read the Pinterest TOS.
    Those state as far as I understand that the use of the service is only for personal and NON-commercial purpose!

    It seems at least quite odd that those who use the service against TOS start to complain about hidden tactics to snatch their affiliate money.

    There are serious copyright issues with the site. The vast majority of users gives a damn about permission from image owners to duplicate images and re-publishing them on public pin boards, transfer of image rights included.

    Therefore I am not surprised about their “hidden” monetizing strategy. It fits well together.

  42. It should also be noted that the link value for SEO purposes is often removed when affiliate links replace the straight HTML links. I am sure that stores won’t mind losing some link value if it means they are generating sales, but it does seem sneeky not to disclose the fact.

  43. avatar Kim says:

    Great discussion, Josh. It’s important to raise these issues, whether one agrees that Pinterest has an obgligation to dislose or not. Letting non-transparent user-generated content exploitation slide under the radar is part of what led to Demand Media stealing en masse from its contributors, and they harmed a lot of people. I’m not saying that Pinterest is harming anyone or is anything like Demand Media, but it’s worth discussing. Far better for the future of the Internet to let community opinion determine acceptable use than to turn a blind eye and leave it to legislation. If Pinterest crosses the line, their users will let them know via forums like this, and if they want to thrive, Pinterest will listen. I love Pinterest, and I appreciate you raising this very valid point.

  44. avatar Cas says:

    I think the issue here is disclosure. In the social world consumers are quite tolerant of affiliate programs so long as there is adequate disclosure of the practice. It doesn’t bother me at all that Pinterest has affiliate links but I shift in my seat a bit when I see a corporate culture evolving that does not have transparency as a high priority.

  45. avatar mariamz says:

    Thanks for the post Josh. Like you I don’t have a problem with them using skimlinks like this – I think it’s a good step forward that they are monetizing up front – however a disclosure in the footer would avoid all this stink of underhandedness.. it’s a simple tweak, they should just do it.

  46. avatar Sue Reddel says:

    As most of your readers have suggested disclosure seems to be the only issue at hand. It’s a brilliant idea but feels a little bit slimy or underhanded without full disclosure.

  47. avatar Sandi Denise says:

    Great article Josh, thanks! I don’t have a problem with the innovative way that Pinterest is monetizing their site, but I do think that they should have disclosed it. I don’t think that it would have changed anyone’s behaviour if it had been disclosed. I wonder if it was an experiment and if it would have been disclosed in time if they decided to adopt it long term….? I’m also curious about your point on the original aff link not being modified- have you done any more tests on this since writing the article? Anyway, thanks for putting up an interesting read, and sparking a lively debate :-)

    • avatar Josh Davis says:

      Hi Sandi,

      Thanks for the comment. I haven’t done any more tests. If you have an Amazon affiliate program, that would be what I used to test the first time.

      Josh

  48. avatar Veronica says:

    Wow this is the first time I’ve heard of this. I actually post my own affiliate links to Amazon sometimes, so I had to go check this out. However, my links still seem to be in tact?

  49. avatar Fred says:

    Skimlinks first got this idea from Google, who modifies links as you are clicking on any search result. They do this so that when you mouse over the link, you simply see the direct link, but when you click, it actually pings Google’s servers first so that they can track everything you click on. If the use of Skimlinks is immoral, then we should be raging against Google and most other Internet businesses as well.

    It’s a pretty anti-commerce position to argue that Pinterest has no right to monetize content that is being posted to its site. It is a position that I strongly disagree with. Most sites have clauses that allow them to modify content you post as they see fit, and that also forbid you from attempting to profit your own participation on the site. In other words, the only people that this hurts are people that were posting their own affiliate links or were otherwise trying to profit from the site, in violation of the site’s terms.