Former Marketing Heads Knock Pinterest Clientele As “Low Income Women” Who Essentially Don’t Matter But Generate Billions
I wonder when the male marketing industry will figure out that women have buying power. Business Insider profiled a series of former, emphasis on former, Pinterest ad execs who claim that the clientele that flocks to Pinterest isn’t really worth working for, because, in short, they are women:
“When you think about Pinterest, it’s more aspirational. You have a lot of lower-income, middle-America people on Pinterest than you do on other sites, and it’s very female-centric. So if you’re a marketer with a budget, where do you allocate it? Put it on Google or Facebook where there are tons and tons of users where you can target very well? Or on Pinterest which is a much smaller audience, female, lower-income, where you can’t target well? It’s just not as efficient,” they added.
Funny, Pinterest shows continued growth:
Tim Kendall, Pinterest’s general manager for monetization, told Business Insider that Pinterest had grown revenue by “more than 5X” between 2014 and 2015.
(If Pinterest generated $25 million in 2014, according tothose documents leaked to TechCrunch, 2015 revenue would have been between ~$125 and ~$137.5 in 2015. However, the documents also suggested Pinterest was targeting $169 million by the end of last year — a growth rate of 6.76X.)
Those “low income women” generated billions, literally billions of dollars. Why isn’t their buying power taken seriously? Notice who is commenting about the marketing power of women? Well, one quote comes from a male exec at Bank of America (no surprise). Bank of America is ensnared in Federal investigations for currency manipulation, as are other big banks:
Bank of America becomes the latest bank ensnared in the foreign exchange investigation to retroactively increase its expected legal costs — and lower its earnings — after reporting third-quarter results last month. Banks are required to set aside legal reserves once they have a clear picture of the costs they are likely to pay in a potential settlement. For Bank of America, the costs came into focus between when it reported earnings on Oct. 15 and Thursday, when the bank filed its official quarterly report with the Securities and Exchange Commission.
Last week, Citigroup announced that it had to lower its profit by $600 million to deal with the foreign currency investigation. Earlier this week, JPMorgan Chase said its litigation expenses in the third quarter, including those related to the foreign exchange investigation, totaled about $1.1 billion.
What does this mean? It means that Bank of America took part in lying about international currencies to benefit themselves, and it’s not the only financial scandal Bank of America is involved in. Bank of America is just recovering from paying a settlement for its part in the mortgage collapse in America:
The $5 trillion market for currency trading is the largest in the world. Traders from different banks are suspected of manipulating the market to drive up the prices of particular currencies toward the end of the day.
Bank of America is a smaller player in this market than many of its peers and its penalties are expected to be smaller.
Still, the foreign exchange investigation compounded the bank’s already high legal expenses in the third quarter.
In August, Bank of America agreed to a $16.65 billion deal with federal and state authorities to settle civil charges related to its sale of shoddy mortgage securities. The cost of that settlement accounted for the majority of the $5.3 billion charge that the bank took in the quarter.
So, given its current financial issues, its lack of consumer confidence, why would Pinterest continue to seek ads from Bank of America? Is the Pinterest move a lack of common sense as Business Insider reports suggest, or is it a form of finesse? One could argue that Pinterest is just now capitalizing, as in billions of dollars capitalizing, on a segment of the population, women, that are under-utilized in buying power.
Pinterest is focusing on, gasp, customer service, and while even its insiders get nervous about this, the power of the Pinterest approach just might be a lesson in marketing:
“Putting together a service organization that services every single advertiser out there is hard and requires a lot of people. I think part of the logic was: Look, let’s go deep with the customers who we know are going to be successful on our platform because their content is so native on the platform, as opposed to spreading ourselves so thin that all of our customers feel like they’re not getting adequate service,” Kendall said. “We’re starting to get to the point of scale and knowledge where we think slowly moving into other verticals such as entertainment and financial services is starting to make sense on an exploratory basis.”
Tim Kendall, with the “thoughtful” approach is being called out to be replaced by, you guessed it, more aggressive men:
His ideal (but unlikely) candidate? Twitter’s COO: “Adam Bain is a monster, he went over to Twitter and he killed. Dude, this guy, you couldn’t stop him, he just makes money — he prints it. They need someone like Adam. He understands brand sales, direct response, he understands the internet. He’s a product-oriented, sales-driven guy. And they don’t have it.”
Product-oriented? Understands the internet? It’s tough to brand sales when Pinterest is based on individual brands.
Kendall, from Pinterest has a different approach that demonstrates he might understand just how valuable the clientele’s “low income women” might be:
Kendall tells us he’s just focused on getting the job done rather than the perceptions of Pinterest in the market.
He added: “We’ve only been in market for a year and we’re just getting started. People are getting used to teh fact that we are in market and we have a marketing offering. As you know, I used to run monetization at Facebook and I can’t tell you how many times I had this dialog in ’07 and ’08, where there was just this fundamental disconnect between the results I was seeing internally and the reporters and external folks that I was talking to in terms of what they thought the prospects were for the company.”
“I have been through this before and my view is that if you worry too much about misperceptions, it’s just time that gets taken away from actually building value.”
Take a page from Frozen, people, even little girls drive revenue, especially little girls.