The Third Degree
Fast-growing social media startup Pinterest is making money already, it was revealed this week, albeit in a somewhat sneaky way. Pinterest uses a third-party service called Skimlinks that crawls through user-submitted links and checks whether a link points to a merchant (ex. Amazon). Then Skimlinks checks if Amazon or whoever offers an affiliate referral program through which the merchant kicks back a percentage to the referrer if the customer makes a purchase. If there’s a referral program, Skimlinks will change the link so Pinterest gets credit for the referral.
Pinterest is making money with affiliate links, something the average Pinterest user cares about approximately not at all, and it’s caused a small kerfuffle. Pinterest is using Skimlinks, a London-based third-party service that scans links and checks to see if the destination (most relevantly, sites like Etsy and Amazon) has an affiliate program that pays kickbacks for referrals, as explained by Pinterest pundit Josh Davis in a post that questioned the ethical implications of using the service without disclosing that fact to users.
But as Skimlinks CEO Alicia Navarro points out in a response on the Skimlinks blog, and as many comments on the story pointed out, the nondisclosure is practically a nonissue. Pinterest has broad language in its Terms of Service that allows it to exploit and monetize user content, as do most free social networks. If a users want to personally reap the gain from the traffic they drive, instead of handing it over to Pinterest, they can submit their own affiliate links; Pinterest won’t mess with those.