HelloSociety pins its business plan on PinterestOctober 31, 2013: 2:38 PM ET
Marketing agency focuses exclusively on distributing content through the social scrapbooking site.
By Chanelle Bessette, reporter
FORTUNE -- The buzz associated with Pinterest -- which just raised $225 million from big-name venture capitalists -- is forcing marketers to take the upstart more seriously. Already, small marketing agencies have sprung up focused solely on the social scrapbooking site. It seems likely bigger outfits soon will be sticking a pin in this social media approach. One company in particular has chosen to make Pinterest its exclusive marketing weapon of choice.
HelloSociety uses Pinterest to create campaigns for their clients. Kyla Brennan, the company's 28-year-old CEO, runs it from an office in Santa Monica, Calif. She and her overwhelmingly female team -- the only male exceptions include her chief technology officer and her platform architect, as well as the company mascot, a Cavalier King Charles Spaniel named Brando -- contact clients, design campaigns, and find novel ways to spread brand content using guerilla tactics. The 24 women on the team are all also under 30, a gender and age disparity that mirrors Pinterest's youthful, female users.
Pinterest enables users to collect "pins" from around the web, images that either link to other web pages or stand alone to inspire, inform, or entertain users. Pinners can categorize their pins and follow other users, from whom they can re-pin items. The result is a mechanism for quickly spreading content, especially pins based around products and brands. The format of Pinterest primes users to become consumers, unlike on other sites where advertising can be a jarring distraction from a newsfeed. Since 2010, the company has grown rapidly. Time magazine listed it as one of the "50 Websites That Make the Web Great" in 2011, and today it has over 70 million users worldwide, according to social media research company Semiocast.
Brennan started HelloSociety in February 2012, and she has made it the company's mission to connect clients to a wide, yet targeted, audience. The primary method HelloSociety uses to spread content is pairing the client's content with Pinterest "influencers" -- pinners who are chosen as a result of their large followings and are considered sages of taste, evidenced by frequent "re-pins" of their content. Holly Ledingham, best known for craft, recipe, and child-related pins, is one such influencer; she has worked with such brands as Joss and Main, and her personal style has enhanced company campaigns. "I love the forum of being able to connect with people," said Ledingham. "It's a great way to share ideas and collect ideas. Back in the day I would rip out pages from magazines and put them into binders. Now I don't have to do that."
If influencers perform well during trials, then they are signed onto the HelloSociety network and paid per campaign, which, depending on the campaign, could pay anywhere from $100 to several thousand dollars, sometimes making up an influencer's primary source of income. Ledingham, a mother to four children, uses her influencer income to supplement her household, and her work with HelloSociety has helped her purchase a home. The influencers are the key to connecting companies with potential customers without using banner or pop-up ads.
One of HelloSociety's clients, for example, is an online retailer of Southern-themed products called Bourbon and Boots. CEO Matt Price started working with HelloSociety in November 2012, and since then he has seen impressive growth in his company as a result of his Pinterest campaign. HelloSociety had their influencers choose items to pin from the Bourbon and Boots website, which resulted in an organic selection process as opposed to an explicitly structured one. Price saw a 40% increase in traffic across the site's marketing channels, and he has noticed a significant increase in profits and revenue as a result of HelloSociety's campaign for his company.
Third-party agencies haven't overrun Pinterest's site so far, and in fact, HelloSociety schedules regular meetings with Pinterest (which, in light of its recent funding, has been valued at $3.8 billion). "We think it's a great sign that so many third-party marketing companies -- both technology developers and agencies -- are committed to helping businesses succeed on Pinterest," Annie Ta, a Pinterest spokesperson, said by email.
Pinterest recently launched its own experimental advertising system called "promoted pins," which currently doesn't bring in revenue. These ads show up in users' feeds and look similar to normal pins, although they are labeled "promoted pin," and include a note that says, "We thought you might enjoy this." Twitter started monetizing with a similar strategy, promoted tweets. "From the very beginning, we expected Pinterest to come out with [promoted pins]," said Brennan. "That's why we went the direction that we did ... I think we complement each other really well. We will continue to be a more in-depth branding campaign."
Brennan said that several brands were hesitant to use Pinterest at first, but after running a campaign, many decided to shift more of their marketing funding toward HelloSociety. While smaller companies have used their Pinterest to make a name for themselves, HelloSociety has also worked with such big names as J Crew, Madewell, and Martha Stewart. Brennan declined to disclose her company's revenues, but she said that HelloSociety is profitable.
Pinterest's popularity may be catching on for many advertisers, but time will tell whether HelloSociety's head start will pay off in the long run.