The growth and popularity of Pinterest has taken brands and consumers by storm, however the recent news of its relationship with Skimlinks to monetise links and in effect turn Pinterest into a "superaffiliate", caused a media storm which in turn spelt the end of the relationship for the two companies. As the first partnership of its kind on a major social media platform, how long will it be before the trend is adopted in a more sophisticated and transparent way, with other social channels following suit?
According to comScore, Pinterest is the third fastest growing site in the US and until a story broke by LL Social blogger, Josh Davis, its phenomenal rise was undisturbed. Davis outlined that Pinterest was using affiliate marketing tactics to monetise links and in his words: "Pinterest is monetising their site while in the early beta stage, which is almost unheard of for a newish social network, [and] Pinterest has taken this action in a quiet, non-disclosing way."
The media storm which ensued ensured that Pinterest broke its relationship with Skimlinks and is now looking to VCs and partners for investment rather than using the affiliate model to help sustain and grow the site. While this may be welcome news for brands who can now enjoy a steady stream of organic customers sharing content with their friends, without having to pay any affiliate fees, I think it is fair in saying this will not be the end of monetisation of links on social channels. In fact, Pinterest can still be used successfully by many brands as a revenue stream and although Pinterest itself is not currently using the affiliate model to earn money there is nothing to say that in the future it won't return to that model.
So what impact will it have on other social channels? Interestingly, despite the negative press surrounding Pinterest's and Skimlinks' relationship, a number of brands who were asked about the collaboration seemed fairly happy that this provided another route to consumers; one which was also being properly managed by a bona fide affiliate service such as Skimlinks. Outrage seemingly came from the secretive nature in which the deal was agreed, not actually from the deal itself. So, if in six to 12 months' time another social channel emerges into the mainstream using affiliate links but is upfront and honest about it, then I'm fairly confident that brands will welcome it, especially if it is bringing with it the traffic that Pinterest is!
Some may also argue that Pinterest used a refreshing way of financing their channel - the Holy Grail for any business looking to monetise through social media. Currently Facebook and Twitter do this through brand ads, engagement ads and sponsored Tweets; routes which may be considered an annoyance for consumers and more intrusive on their social networking experience. Pinterest also, through this route, maintained one of its unique selling points - retaining its aesthetically pleasing façade by removing ads.
So what is the future for affiliate links on social channels? Inevitable, transparent and controlled I would say, or at least I would hope. By working with brands to remove the noise on social channels, affiliate links could be an ideal way to give brands of all shapes and sizes a chance to sell their products online without having to saturate consumers with digital ads.