Could Pinterest Become the Next Facebook?

In the last year, Pinterest (NYSE:PINS) added 120 million users to its platform to reach almost half a billion. But what’s exciting for investors is that this platform has plenty of growth runway ahead. In this video from Motley Fool Live, recorded on Feb. 5, Fool contributor Brian Feroldi compares this social inspiration platform to its larger social media giant cousin, Facebook. Fool contributors Brian Stoffel and Brian Withers join the discussion and provide additional insight.

 

Brian Feroldi: Let’s compare that to another company in this space, Facebook. So Facebook, the average [revenue per] user in the US, $54. Again, Pinterest, six dollars, and Facebook, $54. There’s tremendous amount of room for that number to grow in the United States. Worldwide, so mixing all that together, Facebook up to $10 during the quarter. Again, Pinterest is around a $1.57. That shows me how much room there still is for these numbers to grow considerably, especially if you believe that Pinterest is a more monetizable platform than Facebook. That might be a stretch to say, but I think there’s lots of room for this number to grow both domestically and internationally.

Here’s the numbers for the full year. Basically, thesis on track from a revenue perspective, thesis on track from a monthly active users perspective, thesis on track from an upgrading leverage perspective, so really great full-year numbers.

Digging a little bit more into the details, I realized there’s a ton of words here. What you need to know is that they are trying to introduce new products that make the experience better for pinners. They’re introducing products that make you able to tell stories. One of the things that they called out on the platform was they’re going to really focus on “how to” videos. They’re making a big push into videos. I personally use YouTube all the time for “how to”. Like how do I change the air filter on my car, etc. That could be a major growth area of Pinterest, and they’re investing accordingly to make it easy for content creators to put up that kind of content. That’s pretty exciting.

They’re also investing to make it easier for advertisers to succeed. Brian, how about this, helping advertisers read to the customers is essential to our mission. There’s the mission word again. They are also focused on making Pinterest far more shoppable. That is a major growth avenue for the company.

So here’s the thing on the story pins. They have all kinds of data in the shareholder letter about features that they’re pushing out to make it easier for people to take on new boards and to comment on friend posts. I love this, so the shopping on Pinterest. So that in Pinterest, pinnners can now pivot into shop mode across all product categories, leading to a feed of shoppable product pins. All these efforts have resulted in strong growth in product-only searches which…


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