Study: Pinterest’s $1M Advertising Reaches Valuable Demographics

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Pinterest’s new advertising platform comes with a hefty price tag of a commitment of $1 million to $2 million for the first round of paid pins. For these advertisers, that sum may be money well spent, according to a study conducted by Analogy that got a writeup by Fortune (via CNN Money).

While Analogy, a startup that sells Pinterest analytics and tools, has a stake in the success of expanding sponsored content on Pinterest, the reasoning for the projection is directly based on Pinterest’s core user demographic. Pinterest users include one highly valuable group: educated suburban women.

At 60 million users, Pinterest is smaller than social media competitors Facebook, Twitter, Tumblr, and Instagram, but demographically, the outlet is valuable.

About 33 percent of American women use Pinterest, according to data from the Pew Research Center. In mixed-gender households, women traditionally are the ones who make most of the purchasing decisions for various needs, including grocery and clothing. On this female-dominated social media scrapbooking hub, users are more likely to follow a brand than a celebrity. For advertisers, this means that their ads, which will take the form of sponsored pins, will reach an audience eager to receive them.

About 29 percent of these women are millennial moms who are between the ages of 15 and 29, and highly valuable to advertisers. The research found that these Pinterest users are also more likely to try recipes or crafting projects put out by an advertiser. How do these recipes or projects help sell products? The specific products produced by the advertiser are listed as essential to the project, thus encouraging sales of the item.

Common examples of this type of advertising offline are the recipes on advertising pages in women’s and food magazines. That chocolate chip cookie recipe put out by Toll House is going to list Toll House chocolate chips as an ingredient. An egg salad recipe put out by Hellman’s is going to include the company’s mayonnaise and other Unilever products as ingredients.

Within those pins, the company can also link back to its blog or website, allowing users to purchase what they pin. Considering that users who come to a shopping website through Pinterest are likely to place larger orders than users who arrive on a company’s online store via Facebook or Twitter, paying $1 million for a series of sponsored pins may be worth the sales boosts from Pinterest users as part of the return on investment.

Sponsored content on Pinterest will be making an appearance later this year. First announced in the fall, advertising on Pinterest will take the form of sponsored content similar to what has already been seen on other social media sites. Pinterest hopes to attract both luxury brands and food companies as its first advertisers. Advertising is how many social media outlets make the money to continue running or finance new projects. As Pinterest already has a demographic advantage with its heavily female audience, for advertisers, it may be well worth committing a few million for advertising on the site.

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