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Pinterest covertly swaps out your links for affiliate links

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Big money, big money!

In order to obtain funding, every tech startup has to show investors what their financial strategy is – some begin as free communities that turn premium, others are ad supported, but in an interesting twist, Pinterest has opted for a different alternative wherein they use a service called Skimlinks, according to VentureBeat, which swaps out links behind product pins and replaces the source link with an affiliate link.

For example, any product pinned from Amazon will automatically have a replaced link that becomes an affiliate link so that Pinterest gets a cut if someone makes a purchase from their referral. Some are calling this move questionable and deceptive, others have no problem with the blossoming startup to make money through affiliate dollars.

Josh Davis at LLsocial.com was first to notice the sneaky switch, noting, “I, like many people, don’t have a problem with Pinterest making money off of user content. The links are modified seamlessly so it doesn’t affect the experience. Pinterest likely should disclose this practice to users even if they aren’t required to do so by law, if only to maintain trust with their users.”

Why not the Twitter approach?

As it stands, it appears that only links leading to a retailer that has an affiliate program (like Amazon, eBay, etc.) will have the original source code altered, but if Pinterest is not forthcoming with this revenue strategy in a way that users are aware of and accepting of, what covert moves will be made next? The albatross around Facebook’s neck that they continue to skirt is privacy issues, ignoring user preferences (or “rights” as advocates will claim) – will Pinterest’s albatross be secret revenue streams?

We all anticipated that Pinterest would take a page from Twitter’s playbook and have promoted pins or promoted boards, placing brands’ paid pins in a fixed position or mixed in with people you are already following, but this is an interesting twist indeed. Do you think it is okay for Pinterest to swap out the original source code in pins you create, or are they within their rights to make money off of products you share?

Tell us in the comments if you would like an invitation into Pinterest, we will share ours right away. Please connect with us on Pinterest as we continue pinning away:

The American Genius is news, insights, tools, and inspiration for business owners and professionals. AG condenses information on technology, business, social media, startups, economics and more, so you don’t have to.

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10 Comments

10 Comments

  1. Ricardo Bueno

    February 8, 2012 at 2:42 am

    I'm not against them finding a way to monetize – good for them, especially on a service that's free to users. What I don't like however, is the lack of disclosure. I find it deceitful.

  2. suzanne

    February 8, 2012 at 7:32 am

    I do not think this should be done w/o disclosing……it IS deceitful. Lack of trust from the get go is NOT good.

  3. Lisa Young

    February 8, 2012 at 9:41 am

    I'm not particularly keen on the lack of disclosure, and I know one of my boards is nothing but books I recommend with my own Amazon links, which means they're swapping out my link for theirs. It's not like I make a ton of money on it, and I'd recommend the books whether or not I make anything off the links, but it's still kind of creepy that they don't disclose that anywhere. Makes you wonder what else they're not disclosing.

    • Deidre

      February 8, 2012 at 11:30 am

      I think this speaks to the growing trend on the internet of site owners profiting off of user generated content. It was one thing when ads ran next to content that writers had been paid for but now Facebook, Twitter, Pinterest and other social sharing sites are essentially monetizing content that users are giving away for free. That's fine if the users are aware of it but it's sneaky if users are contributing to a company's bottom line and not aware of how their content is being appropriated.

  4. Jessie Geroux

    February 8, 2012 at 10:16 am

    I much prefer this route (but would love the disclosure piece) over having to wade though promoted/paid for pins—to me sliding in promoted 'pins' with the people I already follow is just as sneaky if not more, because it makes it seem like I somehow chose that to be there because I had chosen to follow the person that pinned it.

  5. Mickey

    February 8, 2012 at 10:22 am

    To Lisa's point, what if someone is trying to use Pinterest to promote their own affiliate links? In that case, Pinterest is doing a disservice to certain users. At the very least they need to be clear and up-front about the practice, not allow folks to just stumble upon this information. It gives them the appearance of being deceptive.

    Having said that, clearly they need to generate revenue somehow. I have no issue with them doing so, it's just important to be up front about it.

  6. Vicki Flaugher

    February 8, 2012 at 10:25 am

    This is illegal. Unless Pinerest fully and openly discloses affiliate revenue link usage, they are not following the FCC rules. They will likely get fined and fined big, likely enough to shut down this clearly struggling (and burgeoning) start up. Google fcc endorsment disclosure and you will find all the relevant information. Not cool. Completely not cool.

  7. Mitch Labuda

    February 10, 2012 at 12:26 pm

    The Pinterest TOS includes member content, which per the site, is also links.

    I asked if links are considered member content and the answer is, so the site lays claims to links per the TOS.

  8. Bill Hibbler

    February 10, 2012 at 12:34 pm

    Personally, I don't have a problem with it. I'm not sure they're violating FTC regulations as they aren't endorsing or promoting the products and I much prefer this to slipping in sponsored pins.

    However, they should be aware that a good portion of their users will be offended by the idea of them somehow profiting from their users pins under any circumstances and the majority will be upset about the lack of transparency. Given the traction this story is getting today, I think we'll see disclosure on the site soon.

  9. Thevelvetkitten

    February 11, 2012 at 10:24 pm

    Yes,I have a problem when it is my stuff being loaded by a 3rd party and it is my work and by their toa,that 3rd party gives them full rights to even SELL . I call BS!!!
    Not to mention if I don't want my stuff there I will never find all of it to have it removed. Nor do I have the time or should I even have to make the time to police their site.

    Enough is enough.

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Social Media

Facebook releases Hotline as yet another Clubhouse competitor

(SOCIAL MEDIA) As yet another app emerges to try and take some of Clubhouse’s success, Facebook Hotline adds a slightly more formal video chat component to the game.

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Woman forming hands into heart shape at laptop hosting live video chat, similar to Facebook's new app Hotline

Facebook is at it again and launching its own version of another app. This time, the company has launched Hotline, which looks like a cross between Instagram Live and Clubhouse.

Facebook’s Hotline is the company’s attempt at competing with Clubhouse, the audio-based social media app, which was released on iOS in March 2020. Earlier this year, The New York Times reported Facebook had already begun working on building its own version of the app. Erik Hazzard, who joined Facebook in 2017 after the company acquired his tbh app, is leading the project.

The app was created by the New Product Experimentation (NPE) Team, Facebook’s experimental development division, and it’s already in beta testing online. To access it, you can use the web-based application through the platform’s website to join the waitlist and “Host a Show”. However, you will need to sign in using your Twitter account to do so.

Unlike Clubhouse, Hotline lets users also chat through video and not just audio alone. The product is more like a formal Q&A and recording platform. Its features allow people to live stream and hold Q&A sessions with their audiences similar to Instagram Live. And, audience members can ask questions by using text or audio.

Also, what makes Hotline a little more formal than Clubhouse is that it automatically records conversations. According to TechCrunch, hosts receive both a video and audio recording of the event. With a guaranteed recording feature, the Q&A sessions will stray away from the casual vibes of Clubhouse.

The first person to host a Q&A live stream on Hotline is real-estate investor Nick Huber, who is the type of “expert” Facebook is hoping to attract to its platform.

“With Hotline, we’re hoping to understand how interactive, live multimedia Q&As can help people learn from experts in areas like professional skills, just as it helps those experts build their businesses,” a Facebook spokesperson told TechCrunch. “New Product Experimentation has been testing multimedia products like CatchUp, Venue, Collab, and BARS, and we’re encouraged to see the formats continue to help people connect and build community,” the spokesperson added.

According to a Reuters article, the app doesn’t have any audience size limits, hosts can remove questions they don’t want to answer, and Facebook is moderating inappropriate content during its early days.

An app for mobile devices isn’t available yet, but if you want to check it out, you can visit Hotline’s website.

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Social Media

Brace yourselves: Facebook has re-opened political advertising space

(SOCIAL MEDIA) After a break due to misinformation in the past election, Facebook is once again allowing political advertising slots on their platform – with some caveats.

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Facebook open on phone in a wallet case, open for political advertising again.

After a months-long ban on political ads due to misinformation and other inappropriate behavior following the election in November, Facebook is planning to resume providing space for political advertising.

Starting on Thursday, March 4th, advertisers were able to buy spots for ads that comprise politics, what Facebook categorizes as “social issues”, and other potentially charged topics previously prohibited by the social media platform.

The history of the ban is complicated, and its existence was predicated on a profound distrust between political parties and mainstream news. In the wake of the 2016 election and illicit advertising activity that muddied the proverbial waters, Facebook had what some would view as a clear moral obligation to prevent similar sediment from clouding future elections.

Facebook delivered on that obligation by removing political advertising from their platform prior to Election Day, a decision that would stand fast in the tumultuous months to follow. And, while Facebook did temporarily suspend the ban in Georgia during the senate proceedings, political advertisements nevertheless remained absent from the platform in large until last week.

The removal of the ban does have some accompanying caveats—namely the identification process. Unlike before, advertisers will have to go to great lengths to confirm their identities prior to launching ads. Those ads will most likely also need to come from domestic agencies given Facebook’s diligent removal of foreign and malicious campaigns in the prior years.

The moral debate regarding social media advertising—particularly on Facebook—is a deeply nuanced and divided one. Some argue that, by removing political advertising across the board, Facebook has simply limited access for “good actors” and cleared the way for illegitimate claims.

Facebook’s response to this is simply that they didn’t understand fully the role ads would play in the electoral process, and that allowing those ads back will allow them to learn more going forward.

Either way, political advertising spots are now open on Facebook, and the overall public perception seems controversial enough to warrant keeping an eye on the progression of this decision. It wouldn’t be entirely unexpected for Facebook to revoke access to these advertisements again—or limit further their range and scope—in the coming months and years.

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Social Media

Twitter to start charging users? Here’s what you need to know

(SOCIAL MEDIA) Social media is trending toward the subscription based model, especially as the pandemic pushes ad revenue down. What does this mean for Twitter users?

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Twitter and other social media apps open on a phone being held in a hand. Will they go to a paid option subscription model?

In an attempt to become less dependent on advertising, Twitter Inc. announced that it will be considering developing a subscription product, as well as other paid options. Here’s the scoop:

  • The ideas for paid Twitter that are being tossed around include tipping creators, the ability to pay users you follow for exclusive content, charging for use of the TweetDeck, features like “undo send”, and profile customization options and more.
  • While Twitter has thought about moving towards paid for years, the pandemic has pushed them to do it – plus activist investors want to see accelerated growth.
  • The majority of Twitter’s revenue comes from targeted ads, though Twitter’s ad market is significantly smaller than Facebook and other competitors.
  • The platform’s user base in the U.S. is its most valuable market, and that market is plateauing – essentially, Twitter can’t depend on new American users joining to make money anymore.
  • The company tried user “tips” in the past with its live video service Periscope (RIP), which has now become a popular business model for other companies – and which we will most likely see again with paid Twitter.
  • And yes, they will ALWAYS take a cut of any money being poured into the app, no matter who it’s intended for.

This announcement comes at a time where other social media platforms, such as TikTok and Clubhouse, are also moving towards paid options.

My hot take: Is it important – especially during a pandemic – to make sure that creators are receiving fair compensation for the content that we as users consume? Yes, 100%. Pay people for their work. And in the realm of social media, pictures, memes, and opinions are in fact work. Don’t get it twisted.

Does this shift also symbolize a deviation from the unpaid, egalitarian social media that we’ve all learned to use, consume, and love over the last decade? It sure does.

My irritation stems not from the fact that creators will probably see more return on their work in the future. Or on the principal of free social media for all. It stems from sheer greediness of the social media giants. Facebook, Twitter, and their counterparts are already filthy rich. Like, dumb rich. And guess what: Even though Twitter has been free so far, it’s creators and users alike that have been generating wealth for the company.

So why do they want even more now?

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