Pinterest Success in 2012

I have been seeing bloggers refer to “pinning” images on Pinterest for a year or more and just recently I finally got an account started. Pinterest required linking to my FB profile which was a dealbreaker, but I deleted the app and unlinked it afterwards. I was curious as to why Pinterest was different than other mood board sites (polyvore) I had seen that didn’t really impress me. At the same time I have been reading more about how Pinterest drives more traffic to retailer sites than Google Images, how women are the primary audience and why Pinterest traffic has taken off like a space rocket.

My take on the site as a web analyst, a woman and a user of the site may be different than the media’s perceptions. I concentrate on the behaviors and uses of the site and have listed my opinons on their growth/success here:

Some reasons I think Pinterest has been a growing site:

1. Images do say more than a 1000 words – They can make you feel hopeful, creative, inspired and motivated. Great images move people. That is why good photography is both art and marketing at the same time. (think Flickr/Instagram) What happens when you want to see that powerful/inspiring image again? Do you bookmark it? With your other 1,000 bookmarks? Blogging it has been better, but not everyone wants to blog and some people frown on hotlinking in your posts although that is what Pinterest uses. Flickr has been great with it’s searchable favorites image list, but not everyone likes Flickr like I do. Some people just want to link other people’s photos and not upload their own. Facebook is ok if you want to blast your friends with all the images you save/share about your home remodel project and make everything archived by the borg, but I really think image saving/sharing is out of context on your personal branding page. Capturing and sharing this image information has had a tricky history and Pinterest solved a problem we didn’t know we had.

2. People are busy and ideas are fleeting – Maybe this is the ADHD generation? I am a GenXer. I have way too much to do, a reasonable income and a very short attention span. I have a hard time keeping track of things that aren’t completely essential and ideas are on that list. In a personal example: With my process of moving around a lot in the last few years, my confidence in the house decorating department was a bit threatened from being a bit out of practice. I have made up for it with a huge file of images saved on my computer from design blogs. It was an old school solution to needing a place to look for ideas from images I already filtered and liked. Did it create solutions for my house? Yep, several rooms in the new house have been redone based on color pallettes from those photos. But in a day I may only see 1-3 photos I like from 50+ interior design blogs. In a year that is a lot to comb through and it isn’t share-able offline nor is it accessible from anywhere. So, Pinterest has recently proved more accessible and more shareable for keeping these images. Plus it is free for now. I could see them evolving into suggesting ad based photos by retailers based on your tags/likes/pins in the future.

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3. Trends/Decisions are easier to analyze when you have all the information from multiple sources in one place. I find it difficult to make buying decisions in this day and age because in most every category there are too many brands, products, colors, choices, prices and options to keep straight. (information overload) Making a pinning board for new shoes you are considering buying takes a lot less time than going to the 5 stores in your area and trying to decide that way or ordering online from Zappos and having to return them all. Plus you can save that pic of that shoe you love but don’t need right now for later. Side by side lists and comparisons make shopping a little easier, but in most cases these wishlists really work on selling to you and others. Someone recommends something, you loooove it, click-click-bought. That isn’t really a bad consumer strategy. I have found that if I ever pass on an item and want to look it up to buy later, it is impossible/gone  with how short the merch time is in stores (online and off) and how styles change so vastly that it may never be seen again. (yet the things you’re never very thrilled with seem to pop up again and again in many different stores). Items/Pictures that are popular on Pinterest may have more staying/selling power due to the large audience or they may be more trendy when people move on to the next micro trend. I am not sure yet because there is a lot of churn in products these days, some people consuming constantly, others stopping completely.

4. Like TED some ideas are worth sharing. I enjoy seeing what my friends have discovered and pinned. It tells me what they are into, what is new, what really good ideas/recipes they want to share and hopefully some of those ideas are good for me too. I have found some interesting clever solutions for household annoyances this way. True, this may just mirror the offline world where women would share tips on household stuff while chatting in the yard, but it makes sense for other subject matter/industries too as long as there aren’t proprietary info in the photos and there is a collective community sharing information. This could be a marketing strategy if you have real solutions your product offers and the story can be told in an image that looks real.

5. The biggest reason? Discovery is a process that a lot of us get a big burst of happy from. It doesn’t matter if it is online discovering photos, reading a magzine, watching a TV show, taking a vacation or creating something like artwork or crafts. Many of us have jobs that are pretty specialized and we do a short list of things for the company and don’t have a lot of variety or creativity in our daily lives. I have found that I need some form of creativity (writing, photography, art, dance, design) in order to be happy and I have a feeling that this may be the case for others too. Even the simulation of creativity by discovering and learning from photos of how to keep wrapping paper on the roll with a sliced toilet paper core haves us that Aha moment and makes us feel happier, smarter & more connected. All this in an easy to use format and without requiring much reading for the ADHD generations.

6. Another reason it may be growing is that Pinterest is very accessible on iPads which can go anywhere in the home when you have time to look at it. (the app is just fair, I prefer the full site in the browser on an iPad) It is a guilty pleasure just like celeb blogs on some level. I think mobile/tablet use is making the site more addictive although probably not the main reason for it’s success. Now that retailers (Etsy) has added pin it button to their listings pages I hope more retailers do this to help promote their products. One thing is clear though, it will take 500+ views and likes before you find someone ready to buy, and you will probably have to have some familiarity/trust built with them first. Most people do a lot of window shopping/dreaming on the site, a lot more than buying. But that is part of marketing, getting the word out in the first place, or as some say, creating the need. A large enough audience may just be able to significantly impact sales too.

7. The more I think about it there are more reasons that this site works well and attracts people so quickly. An element of new sites that often works well is keeping the interface simple and the navigation self explanitory. (especially with people who don’t have a lot of time or patience) In this case the content/images take center stage and the navigation/functionality is uber simple and almost in the background. If/when they would like to expand on it they can build more complexity over time and teach the audience along the path to more features just as/or before they get bored with the current ones. Facebook has done this pretty well and has been able to innovate its way ahead of many other sites.

Any other reasons you think Pinterest is growing so quickly?

Can ordinary people manage the risk in the stock market for their retirement?

I am beginning to think there is no way an average American can invest in the market and make any money for their retirement in a 401K. I was reading this morning that 5 and 10 year returns in the portfolios of most mutual funds are negative now when they calculated in the huge losses from recessions in 2001 and 2008 and the beginning of 2009. (Q1 hasn’t been kind) 

As an investor (for my 401K) I look at that and say: yuck! Why would I put my money in something that has no long term value?

My fiance sent me this article saying that now 20 and 30 years are the benchmarks for best overall performance in mutual funds and stocks in the market. Yikes! 20-30 years? Who has that much time before retirement? Who can invest for that long anyway?

When you consider that most people’s salary starts dropping when they reach their 50’s (because employers don’t value old employees and can’t spend time/money updating their skills) you really have 25 years max to work with as far as investments for retirement.

You start your first real paying job with a 401K at age 25 and you may not be fully employable by age 50 although you will likely live to the age of 80 or 90.  There’s your 25 years to save and invest for 30-50 years of retirement.

I also think there is something else going on here affecting the 20-30 year market profit numbers. The US Markets benefited from a long term technology/innovation and growth curve from WWII to the 1980s. Personally, I think that was a one time deal and we will never see that kind of long term prosperity again.

Why? 1. Because we don’t understand enough about technology to innovate on that level again to create that much growth. 2. Because the US has higher paid workers than anywhere else in the world and everything gets manufactured and produced (and serviced) somewhere else. 3. Because we’re too complacent and have too much entitlement as a country of workers. Work creates wealth, not shell games with securities.

That brings up another point: We’ve been playing a shell game with our economy since the 1980’s. De-regulate, re-regulate, stimulus, fix, fund, trade, outsource, sell, leverage, whatever… It’s all a shell game to us worker bees and the internet has been the only significant improvement in technology to create new industries and jobs in the last 20 years. We need more than that to survive and prosper as a nation and a world.

I don’t know about you but I can’t stand to take that much risk with my money. I have some in a 401K but mostly my retirement is locked in a 5 year CD IRA at 5.25% that was a promotion this fall when banks wanted more cash reserves. I changed companies in 2006 and rolled over the old 401K to a bank in 2007 because I knew the 10 year recession was coming soon and I didn’t want to risk timing it.

There will always be people who game the market and come out ahead, but those of us without finance degrees, huge money to invest in undervalued markets or inside scoops will never really profit on the whole. Many of us will get out exactly what we put in and maybe less considering our lack of  investment prowess. So, in that level of risky why not just put it in the bank? Positive 3-5% sounds a lot better than negative 40%.

I hate the inflation argument that says that 3-5% isn’t enough to make money after inflation. Guess what? Inflation has been very low and inflation doesn’t stop when you have negative returns either. I’d rather have some money dependably than none at all when prices are higher. 

You may be asking why I want more innovation and less investment in the market? Doesn’t investment in the market lead to more innovation?

NO. Most of the mutual finds and stocks you can buy that are highly rated are in huge old (one trick pony) risk averse companies that have already peaked and can’t figure out how to do anything new. They sell shares to raise cash and then have old people make decisions like the old days. Venture Capital,  new small businesses and Universities are the place where innovation happens. If I could invest in those, I would. But then again I don’t have millions of dollars and apparently I won’t any time soon.

What are the best proven ways to fund your retirement and create wealth then?

1. Have a side job for extra income you can save (part-time weekends or evenings a few nights a week)

2. Own rental property for extra income (you need to live near it for this to work)

3. Have fewer kids if you’re contemplating having a family (ok we don’t always control this, and we love kids, but nobody is going to debate that they are expensive) 

4. Own a smaller home (smaller mortgage = smaller amount in interest paid (lost) to the bank)

5. Don’t go into debt on credit cards or car loans (hello! 25% interest, MONTHLY! on some cards)

6. Live frugally generally, keep your cars 10 years, don’t buy new clothes every month and don’t buy big ticket items like TVs and Computers every few years. Spread out the expenses over the long term.

7. Share what you have with others. Seriously, knowledge, help with projects, donating time and donating items you no longer need, as well as hand me downs between families help kids and neighbors live better within their means and help the community live better too.

8. Take care of your health. Eat less junk, lower fat, lower salt, lower carbs. Exercise daily. Take vitamins. Don’t work in an industry that has a side effect of cancer. Visit the doctor regularly and if something comes up treat it early, it will cost so much less in the long run. Heath issues start in your 30’s and get more frequent in the 40’s, 50’s and 60’s. Expect to pay more every decade for health costs in your life/budget.

These are all real tactical changes we can make to save more money monthy and yearly that will get better returns than the stock market and help prepare for inflation. What else do you think can help?

Google to hit 900? Then what?

I was reading yesterday that Google increased it’s marketshare in search by about 1 percent to 64.5% of the searches done in the US each month. The up side of this is that they are gaining marketshare from the other few search competitors and are poised to continue being the leaders for a long time to come. The down side is that they may only be able to obtain around 80% of the market (without buying competitors) and that last 15% they have to go before topping out may only take another year to obtain or 2 at the most. That means that this Google run on stock is a limited time deal. The increase in stock price seems to follow the increase in market share and we now see the end in our sights. We know they are doing a lot to pursue getting google offline to cell phones via mobile advertising and maps on gas station pumps, but this is not the same as tapping a 180 million person online market by becoming everyone’s home page. It will take a lot longer and more technology develpment before google is relevant on phones. Most people have web access but if they are like me, they decline it now as a costly extra service that runs really slowly and is difficult to use on a cell phone screen. User interfaces have to become better. Screens have to become better. Unlimited Web access has to be free on your phone with your plan. I know that Google has overcome other challenges in the past but they are used to getting what they want quickly and this beyond the web growth is not going to happen as quickly as they would like and it may not arrive soon enough to pull us out of a recession in 09. It’s the 10 year curse and it’s coming back at the end of 09.

Finding Broadband in the UK

I have a bunch of coworkers that fly overseas to the UK several times a year and they say that things are somewhat similar living there but there are always more differences than just the dialect. One difference is the technology for broadband. More people are catching on there now, but the popularity had lagged behind the US for some time. I am not sure if it was because of infrastructure or just not as much popularity. I also just read that online advertising is booming there and all over Europe so maybe their bubble is starting now? Anyway, if you are someone going to move to the UK or live there now, a broadband company I have heard about offering wifi broadband is BT Consumer Wireless Services. They are equivalent to an AT&T or Verizon here. And wireless makes more sense over there anyway. Why not get wi fi rather than rip up walls to install cable? It just makes more sense.

Moving Time

It’s nice to be working at a company that is doing well, but like in past companies I have worked in, this means that growth squeezes you out of office space quickly. We are trying to rearange things and move people around to fit a bunch of new hires again. We seem to be hiring one or two people a week. It’s crazy but in a good way because there is a good growth rate going on. Not an unmanageable or unsustainable amount, just the amount that is good and consistent for our industry. Plus people’s budgets with online advertising are growing so our existing acounts are billing larger numbers year over year. I hope this run continues for a few more years. I’d really like those rumors about a recession coming in 2008 or 2009 to not be true.