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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 (AG) 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 wants your nudes now to protect you from revenge porn later

(SOCIAL MEDIA) Facebook, attempting to get in front of revenge porn, is requesting that users send in all of their nudes.

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In a heroic and totally innovative attempt to combat revenge porn, Facebook has come up with the following solution: “PM US UR NUDEZ.”

No seriously. They want your nudes.

But don’t worry, they’re only going to be viewed by a small group of people for manual confirmation of said nudes, and then stored temporarily… for reasons.

That part gets a little fuzzy. Some sources report that Facebook isn’t actually storing the images, just the links. This is meant to convert the image to a digital footprint, known as a hash, which is supposed to prevent the content from being upload to Facebook again.

Others say Facebook only stores the images for a short period of time and then deletes them.

What we do know, is this is a new program being tested in Australia where Facebook has partnered with a small government agency known as e-Safety and is requesting intimate or nude photos that could potentially be used for revenge porn in an effort to pre-emptively prevent such an incident.

Revenge porn is basically when someone uploads your personal and private photos online without your consent. Rather than address the issue of whether or not it’s such a good idea to take photos on a mobile, hackable device, it’s better to just send a large corporation all your nudes… through their Messenger app. /sarcasm

For your protection.

According to the commissioner of the e-Safety office, Julie Inman Grant, however, they’re using artificial intelligence and photo-matching technologies… and storing the links!

If this isn’t convincing enough, British law firm Mishcon de Reya LLP wrote in a statement to Newsweek, “We would expect that Facebook has absolutely watertight systems to guard the privacy of victims. It is quite counter-intuitive to send such intimate images to an unknown recipient.”

Oh, she wasn’t joking.

I’m not sure how many people still hold onto old intimate photos of themselves, but I am doubtful that it’s enough for this to really be effective as it only prevents intimate photos from being shared on Facebook. At least that’s the plan.

Reactions to this announcement have largely been met with amusement and criticism ranging from commentary on Mark Zuckerberg and Co. being total pervs, and theories of shared Facebook memories: “”Happy Memories: It’s been 1 Year since you uploaded 47 pictures of you in your birthday suit”!

Either way, I can only imagine someone’s inbox is flooded with crotch shots right now, and Zuckerberg has a potential new industry in the works.

Just sayin’.

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Social Media

Twitter might make a profit for the first time… ever

(SOCIAL MEDIA) Twitter seems to be very popular but it may surprise you to know that this is the very first time they might make a profit.

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Twitter reports that after a year of slashing expenses and putting itself in a position to sell data to other companies, it’s expected to be profitable. What’s surprising (considering how #huge Twitter is) is that this the first time that it will be profitable based on “generally accepted accounting principles” – #GAAP!.

In the 11 years since Twitter took to the field, it has never once met this standard, operating at a loss of nearly 2.5 billion dollars since its inception.

Twitter has struggled of a number of reasons, but particularly after going public in 2013 it suffered declining user growth, the rise of the #twittertrolls (coincidentally, Troll’s are discussed in my favorite TIME piece about the internet – located here), and competition from Facebook for the tough realm of advertising.

Since 2013, shares fell steadily, but things have increased thanks to some optimistic changes – the promise to crack down on harassment and abuse, a feed arranged by algorithm instead of time, and Twitter’s most vocal fan of late, President Donald Trump.

For the numbers fans, Reuters provides some input: Twitter’s loss narrowed to about 21 million down from 103 million this year. They have worked to cut a great deal of expenses -16 percent across the board broadly impacting sales, marketing, and R&D.

This kind of focused core improvement (can) help tip the balance sheet on the expenses side – but generating revenues remains a challenge due to slow growth. Twitter hopes to relieve this by working out some deals to sell data – the currency of the 21st century.

Several months ago, TechCrunch made perhaps the most important observation – that despite the fact Twitter has changed the world, changed our marketing, and empowered us to connect with other people, it has remained unprofitable. Many small and large businesses profit from Twitter, but in these 11 years the company hasn’t #sharedinthewealth.

Twitter is touching every realm of business and for American’s, is touching every aspect of their lives given its new form as the preferred medium of the political sphere. Given that, they have much to do to change.

Facebook commands an audience five times the size of Twitter – and their ability to reach success for the future seems #questionable. And how Twitter’s success changes the scape of influence, outreach, and entrepreneurship is something else to be seen.

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Social Media

Is Facebook a potential Slack killer?

(SOCIAL MEDIA) Facebook’s steady ascent from social networking into the business world is giving Slack a run for their money.

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When it comes to the business realm, Facebook has steadily been increasing their reputation. Though Facebook is pinned as the social network, they are now proving to everyone that they can dominate in the professional sector as well.

Last year, Facebook launched an ad-free version of the site meant for the office called Workplace. Initially, 1,000 companies were signed on to try out this “Facebook for the office” in its starter phase.

As of last week, Facebook announced that 30,000 organizations currently use Workplace. These aren’t just small time companies. Some of Workplace’s users include Starbucks, Lyft, Spotify, Heineken, Delta and most recently Walmart.

It seems that overnight it grew from another side project to a valid rival for other professional communication tools like Slack.

Slack is the go-to site for business professionals. With over 6 million users and acquiring more every day, Slack is the place for teams to collaborate in real-time. It has virtually replaced email and external software when it comes to internal communication.

Slack has been successful at acquiring small corporations to use their service.

The problem is that Slack has yet to join forces with larger clients that have now turned to other applications. Just last year, Uber left Slack because they could not handle their large-scale communication needs.

In addition to being able to handle the needs of large companies, Facebook also offers cheaper services than Slack. A premium account with Workplace costs $3 per user each month while Slack charges double at $6.67 per user each month.

With the rapid growth and major reputation of Facebook behind it, many predict that Workplace will replace Slack, and other sites like it, in the not so distant future.

Recently, Facebook also launched the Workplace desktop app and plan to include group video chat. The biggest obstacle Workplace faces is the association with Facebook. It is ironic, since it is also their greatest strength.

The truth remains that many people think of Facebook solely as a social media network. Many companies forbid the use of it at work so the transition from the personal to the professional realm is still an uphill battle.

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