Pinterest Seeks Ad Revenue With Promoted Pins

Website promises transparency when testing sponsored content ads.

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Social media website Pinterest is integrating ‘Promoted Pins’ in hopes of developing a ‘tasteful’ advertising model.

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Pinterest is planning for the future of its photo-sharing website by experimenting with "promoted pins" to see how they can generate revenue, but the company told users that it is trying to be "tasteful" as it develops its advertising model.

[READ: FTC to Study 'Sponsored Content' Online Ads]

"We're going to start experimenting with promoting certain pins from a select group of businesses," Pinterest CEO and co-founder Ben Silbermann announced in a blog post Thursday. "For our first test, we'll promote a few pins in search results and category feeds. For example, a pin for a Darth Vader outfit from a costume shop might be promoted in a search for 'halloween.' Nobody's paying for anything yet — we want to see how things go and, more than anything, hear what you think."

Pinterest, founded in 2010, was valued at $2.5 billion in February following a round of financing led by Valiant Capital Management, which also included Andreessen Horowitz, Bessemer Venture Partners and FirstMark Capital. If this promoted pins step is successful it could help the photo-sharing website generate revenue and prove that valuation. Yet Silbermann also recognized the need to please consumers while developing Pinterest's advertising system, so he promised in the blog post that the company would be "tasteful" by avoiding the use of banner ads or pop-up ads.

Silbermann's reassurances reflect that sponsored content on websites is an evolving concept. The Federal Trade Commission (FTC) plans to host a workshop examining sponsored content in December, which could lead to new guidelines for businesses to ensure that customers are properly informed about online advertising and that sponsored content is clearly identified.

[ALSO: Can Google Turn Around Mobile Advertising?]

Social networks including Twitter are also tinkering with sponsored content and other ways to generate revenue.

Pinterest's user base is shifting toward mobile advertising. Analytics firm comScore said Pinterest had 25.6 million U.S. unique visitors on the Web during August, but its traffic on mobile devices boomed from 9 million unique visitors in January to 24 million in July, AdWeek reports.

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