I am a firm believer in the philosophy of “good things come in small packages.” I’m talking about more than just cute, tiny corgis and newborn babies, but also about the smaller social media channels. Facebook ads continue to be the gold standard for businesses (and startups!) to advertise their product or service. They’re effective, so effective that nowadays everyone is really concerned about their privacy because of the Facebook Algorithm.
That effectiveness came with a two-sided sword. Businesses were getting high returns on ad spend but also had to pay more due to high competition and relied solely on Facebook Ads. As their main channel to advertise and reach both new and existing users.
If you use Facebook Ads for your business, you must have noticed that recently it has become not so effective. It is getting expensive day after day, which got advertisers thinking about new ways to approach ad channels to achieve diversification and decrease costs while growing. The Apple Tracking Transparency “ATT” introduced by Apple didn’t just affect user tracking for good, it gave other platforms like Pinterest, Reddit… a chance to compete with Facebook and get a piece of the advertising cake. In this series, we’re comparing those channels against Facebook and take a closer look from a performance marketing perspective.
How do Auction Ads work?
Have you ever surfed the Facebook app or website and seen this promoted post or ad in the middle of your feed? This is simply how Facebook makes money, selling ads. Facebook and major channels like Google Ads, Pinterest… are offering auction ads to give advertisers access to target many, many users to promote their products or services. Auction ads are just like normal auctions but work in a very programmatic way. You simply open a campaign, set your maximum budget per day or total budget, and set how much you are willing to pay for an impression, click, or website action on your targeted audience.
Facebook Ads uses an auction model and a very powerful algorithm that really knows when and who to target with what ad. This is the ideal place for an advertiser to acquire new users and engage existing ones. However, being so efficient has a negative side. According to research – the starting cost per 1000 impressions cost in 2019 was around $5.12. While according to Webfx, the average cost per 1000 impressions in May 2020 is $7.19. That’s almost a 40% price increase for one year. With more and more Facebook ads each day, the CPMs are definitely rising.
This makes a less-than-ideal scenario for advertisers with limited budgets. In the end, not all of us could afford to spend a 7-figure monthly budget to keep using Facebook Ads. Recently, advertisers started looking into other social media channels in the hope to find a similar effective channel at a cheaper price to keep their businesses alive and potentially grow steadily. Here comes Pinterest ads.
Pinterest Audience Statistics
Pinterest is the 14th largest social network in the world. It ranked the 14th largest platform in the world in terms of global active users as of January 2021. It’s gaining popularity just as quickly as it is growing older, the social media platform is clearly making a name for itself. Pinterest has grown its active user base and gained more than 100 million monthly active users in 2020. The influx of Pinners led to a 37% rise in monthly active users between 2019 and 2020. It is the most popular social network that connects with products and shopping-related content.
Pinterest’s Q4 2020 Shareholder Report shows that a significant share of the company’s growth took place outside the United States. International monthly active users rose to 361 million in 2020. That’s a 46% increase from the previous year. In the United States, 98 million people were active monthly on Pinterest in 2020, representing an 11% increase. In a recent blog post, Pinterest identifies men as one of the platform’s fastest-growing demographics.
The number of male Pinners increased by nearly 50% in 2020. That makes the female audience at 77.1%, the male audience at 14.5%, and the remainder as unspecified as of January 2021. That’s not all as the number of Gen Z users grew by 40% between 2019 and 2020 which means that Gen Z isn’t spending all their time on TikTok as you may have thought. According to Pew Research Center, anyone born after 1997 is considered a part of this generation.
Pinterest Usage Statistics
82% of people use Pinterest on mobile which is slightly less than last year at 85%. In addition to that, 95% of the top searches on Pinterest are unbranded which means that Pinners are open to discovering new products and ideas. This sets Pinterest as the platform for small and medium-sized businesses, with 9 in 10 people using Pinterest for purchase inspiration.
Pinterest Marketing Statistics
Pinterest is a social media platform that people often miss when creating performance marketing strategies. Like with all social platforms, though, there are ways to use Pinterest for your brand. The largest audience in terms of members in any country is in the U.S., with over 100 million active users, this represents 50% of all active users on Pinterest. The US is then followed by Germany, France, the UK, and Canada. This means a huge opportunity and Pinterest reported that shopping ad revenue once again grew faster than the overall business with a 6x increase in the number of businesses that used the shopping ads format in Q4 of 2020.
The increase resulted in a 300% growth of weekly conversions on Pinterest compared to last year. It shows that Pinterest users were not just viewing or engaging with shopping ads, they were checking out too. One last interesting insight is that almost 50% of total ad spend used automatic bidding in Q4 2020 since Pinterest rolled out automatic bidding for shopping ads in October 2020. This shows that Pinterest is on track to probably achieve the algorithm efficiency that Facebook and TikTok already have.
Read more: Pinterest Ads for eCommerce
Our instincts are to seek big. I want to own a big house, have a lot of money in the bank, have the biggest company in town, and have the biggest marketing budget in my vertical. But with marketing, sometimes less is more. It really comes down to what you can do with less that can become more. Especially in today’s world, when any business can target the same audience and leverage the easy entry to online advertising.
This increases competition and makes it even harder to get a real value on your advertising dollar. Similar to big cities, they’re overrated and unnecessary to those who can work from home. And It’s time for marketers to stop thinking about “big.” Big ad channel, big reach, and big social media presence. It’s time to think value! That’s it for this one, see you in the next article about app growth marketing. Ciao!