Why Pinterest Has the Most Potential for Advertisers

Over the past few years, Pinterest (PINS 0.27%) has become incredibly enticing to advertisers. In this segment of "The Morning Show" on Motley Fool Live, recorded on Feb. 15, Fool.com analysts Maria Gallagher and Sanmeet Deo, as well as Director of Small Cap Research, Bill Mann discuss the social media company's inspiration to action goals.

Maria Gallagher: Yeah. It's really interesting when you compare, I think it's fascinating because you know what people spend their time on, what people like. I think the rise of micro-influencers kind of changing the game of how advertisers work is fascinating and how much money advertisers now spend on content creators, which didn't exist five years ago. Sometimes they'd have YouTube [part of Alphabet (GOOG 0.23%) (GOOGL 0.23%)] sponsorships, but now I have bought clothes and things from micro-influencers because I am an advertiser's dream client. [laughs]

Bill Mann: You got to get ready for that lobster dinner.

Gallagher: I see something once and I think I do need that. You're right. That's incredibly true. [laughs]

Mann: Thank you for thinking of me.

Gallagher: Thank you.

Sanmeet Deo: Then with one-click buying, it's yours.

Gallagher: It's mine.

Deo: One day it's in your house.

Gallagher: Why do I own four different nesting trays that I've never used? [laughs] I don't know, but I do.

Mann: [laughs] Sorry, not sorry.

Gallagher: I think it's just so interesting where advertisers are seeing the best bang for their buck and the argument, Pinterest has always had its unbranded search. If people go to Pinterest, they are usually going just and typing in "wedding." They're not saying a specific brand of designer dress. That was a really good place for advertisers to go to because you had these people going in without these expectations of what they wanted from the platform, so that is a really enticing place for advertisers to get you as a customer if you're not going in loyal.

I think that especially with YouTube, with TikTok, with Instagram [part of Meta Platforms (META -0.05%)], all of these different platforms are competing to show that their users are going to be the ones who pay up. That is a really interesting dynamic to study and see well, how much are people paying on Snapchat (SNAP -0.99%)? You have a much younger demographic on Snapchat, but are they paying less for things? Because they're just scrolling with their friends whereas Pinterest is a little bit older, but it's a lot of people wedding planning, so are people spending more on Pinterest versus TikTok? All of those different dynamics and seeing where people both spend their attention and then spend their money. I find it fascinating.

Deo: My wife uses Pinterest a ton. She doesn't really use Instagram, but she loves Pinterest and she has all these boards or what is it when you have a collection? She has this whole collection of house-related stuff. We're shopping for a house, what our house would look like from the farmhouse, she likes the modern farmhouse.

What it would look like, what would it look like inside, and she has all these great pictures she showed me, and I'm once we get to that point, we're going to decorate our house if we have it already right there in an image on Pinterest and I really love that rug. Can I click on that rug and go right to the company that's selling that rug, and maybe I'll just buy it right there because I'm visually seeing what I want instead of having to search for it. I'm seeing all these designs, rugs, and interior decorations or even just like I really like this flooring, click, well, this flooring is from so-and-so manufacturer. It's really interesting.

I feel like there's so much potential with that shop to click kind of thing where I see it, I like it, I'm going to go click it and maybe I'll buy, probably on a much higher chance than if I just go to Google and search for it myself and figure out who bought this and who makes this and that kind of stuff. A lot of potential there for sure.

Gallagher: Yeah, they say it's from inspiration to action. It's their goal. I will say the part of TikTok I'm on because everyone has their different section of TikTok that your page has curated for you, and mine is soothing apartment tours and soothing videos of people baking. It's all very soothing. I always am like, oh that's such a cool lamp, where did they get that lamp?

But it's hard in the video because it ruins the vibe if you say it during the video because it's a soothing apartment tour. Then in the comments, you have to search to see if they tagged where they got their lamp. It's a pain. I'm probably not going to make that extra effort, whereas if I just saw a picture of it, and I can click like with Instagram, you can tap it and see, where is everything from, let me click into it and buy it.

Deo: It's a digital catalog.

Gallagher: Yeah, it's all about that ease of use.

Deo: Pinterest is very much so you're going to digital catalog because you're searching for certain themes. Like you said, clothes you want, dress shopping, or house shopping, interior design, or weddings, or birthday parties, or whatever it could be, lots of themes and then when you're putting together one of those themes in real life, where do I go to shop for that? I saw this great thing on Pinterest I can just go click there versus finding out who makes it, and how I can find it, what stores sell it, all that kind of stuff.