Pinterest has said it may soon launch a marketing campaign to bring in new users after its performance for the third quarter fell below estimates.
The social network reported revenue of $279.7m for the period but it fell shy of the $280.6m that had been forecast by Refinitiv. Monthly active users were up on expectations, with Pinterest reporting 322 million versus 311.8 million forecast by FactSet. However, the expected average revenue per user was below, standing at 90 cents versus 91 cents forecast.
However, it did outpace the likes of Facebook and Google when it came to sales growth. Though its ads offering is relatively nascent, it saw growth of 47% in the latest quarter versus Facebook’s 28% ad sales growth and Google’s 17%. Its new video ad formats are proving popular among brands, it said and grew three-fold year-over-year.
“We're building a lot of the back-end features to improve upload speed, client performance, and analytics,” chief executive Benjamin Silbermann said.
“We also launched a new cost-per-view objective in Q3, and that's really for advertisers wanting to push their brand awareness. A great example would be NARS, a cosmetics company that launched its new lipstick on Pinterest, using that cost per video view objective to launch a brand-new product. We think it's going to continue to contribute significantly to revenue in the future.”
Despite these promising figures, it missed estimates for its 2019 full-year outlook, saying revenue for the year will come in at $1.1bn to $1.115bn, versus the $1.12bn expected, leading to a 19% fall in share price.
A ‘big dollars’ push for users
In addition to rolling its ad products into new markets, Silbermann hinted that it would embark on a drive for new users in the coming year.
The company’s last, and only, major advertising campaign came in 2017. Called ‘What If’, it was developed by ad creative Janet Champ and ran across Times Square billboards as well as in press and on TV.
But its rivals have been increasingly investing in their own marketing efforts to woo users. Snapchat, for example, is in the midst of a marketing effort that has seen it show how its platform is used by friend and family groups. Though intended to reassure users rather than acquire new ones, Facebook’s current marketing push has focused on its privacy options.
In apparent anticipation of a major advertising effort, Pinterest’s sales and marketing expenses for the past quarter shot up to $111m, versus $66m for the same period a year prior, partically as a result of an increased headcount.
“On the consumer side, we haven't yet done a big brand push,” said Silbermann.
“We focus more on opportunities to reengage existing users who might have used Pinterest in the past for one use case. We want to remind them if a seasonal event comes back that we think are interested in, that Pinterest is a platform that can create value from them. We're talking internally about efforts to sort of build awareness through brand. We haven't deployed big dollars against that just yet.”
Pinterest appointed its first chief marketing officer last year. Andréa Mallard, the former marketing chief of Athleta, has been overseeing the marketing and creative teams since 29 October and has previously talked up the importance of pushing the brand to do more traditional marketing as it expands globally.