Cheat Sheet: Pinterest looks outside the U.S. in pursuit of future growth
Like other social platforms, Pinterest benefited from millions of people being stuck at home for the last year, looking for design inspiration for how to turn a closet into an office, or make easy one-pot meals. Now, as it reports its first-quarter results, Analysts wonder how long that momentum will last once more coronavirus restrictions are lifted and Pinterest looks to blow out its revenue per user.
The key details:
- Pinterest reported $485 million in first-quarter revenue, an increase of 78% compared to the same quarter last year.
- Global monthly active users increased to 478 million for the first quarter, compared to 459 million in the fourth quarter of 2020, and up 30% year over year.
- ARPUs for U.S. users for the first quarter were $3.99, compared to $2.66 for the same time last year.
- Revenue guidance for Q2 is that revenue will grow around 105% year over year. But Pinterest signaled that U.S. user growth will be “flat.”
Pin, then shop
In the last few months, Pinterest has made ad product updates with an eye towards video and commerce.
During the call, Pinterest CFO and head of business operations, Todd Morgenfeld, mentioned that the company does have an eye on native checkout. “We get that the next step in the funnel would be testing native checkout and eliminating that friction. We aren’t committing to it yet because we want a good experience for the user,” he said.
At its first ever advertiser summit in early March 2021, the platform debuted Pinterest Premiere, a new video advertising product.
“For marketers that have adopted formats like Pinterest Shopping and video ads, the platform provides a full-funnel opportunity,” said Aaron Goldman, CMO of Mediaocean. “In the face of iOS 14.5 rolling out, Pinterest offers a closed-loop solution to resolve identity and measure outcomes.”
In March, Pinterest also made updates to help users get more personalized searches for beauty related products by rolling out its skin tone feature, which allows users to choose a skin tone range for better color matches. Pinners could already virtually try-on lipstick and eyeshadow shades using AR lenses.
Gen Z, and male users, increased 40% according to company sign-up data. Now the platform is looking to capitalize on its wave of new Pinners through video ads and expanding shoppable pins.
Pinterest is also looking to further monetize its international reach.
On April 5, 2021, the platform opened up its advertising offerings in Brazil (and will launch in Mexico in May, according to the earnings report). On April 21, Pinterest announced it was expanding its partnership with Shopify to 27 countries. Pinterest has 380 million international monthly active users, compared to 98 million in the U.S.
“We saw very encouraging global growth on Pinterest in 2020, spanning anywhere from 20-50% YOY,” said Amanda Grant, global head of social at GroupM. “There is also more being realized on the platform from an e-commerce perspective, which has peaked new advertiser interest and further utilization of the platform.”
Shopify merchants with a Pinterest business account will also be able to add up to 20 product “catalogs” to their account.
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“We are not diminishing the importance of AR,” he said. “In fact, we are strategically reallocating resources to strengthen our endeavors in AR advertising and to elevate the fundamental AR experiences provided to Snapchat users.”