Pinterest secretly swaps links for profit

Pinterest/CBS

(CBS) - Social vision board site Pinterest has taken the Internet by storm, but new allegations of link swapping may tarnish the company before it gets out of beta.

The invite-only site lets users "pin" photos to a virtual image board. Its easy user interface makes the site extremely addictive.

Although still in open beta, Pinterest skyrocketed in 2011 and even surprised the industry at the speed of its growth. TechCrunch reported that site attracts 10 million monthly unique visitors in the U.S. alone. It isn't all gravy for some loyal users, however.

The affiliate marketing blog GTO Management noticed that links were being changed without notice to members. Instead of going to a user's link, Pinterest is swapping out the links to the benefit of its partner Skimlinks.

"I discovered that a pin that linked to one of our merchant clients was swapped out for a Skimlinks affiliate link," Joel Garcia said in a blog post. Garcia repeated this experiment a few times with varied results.

According to social media blogger Josh Davis, Skimlinks automatically goes through a site and converts affiliate links, so that it will point to its own.

Josh Davis

The problem isn't that Pinterest is trying to monetize. The problem is that users are left in the dark.

This is especially troublesome for organizations using Pinterest to promote their products. Davis explained that "if the store has an affiliate program, it is highly likely that those links now will have an affiliate code in them that gives Pinterest a percentage of any sales."

Davis pointed out that monetizing without using ads has appeal when considering the user experience. However, lack of disclosure is definitely an issue.

"With respect to FTC rules on disclosure of affiliate links, the law is that any content creator that is *endorsing* or *recommending* something and obtaining financial benefit as a result of this endorsement, needs to disclose it," Alicia Navarro, chief executive officer of Skimlinks, wrote on Davis' blog.

"In this case, Pinterest are not pushing people to buy something because they get paid for it, they provide a platform that drives traffic to retailers and they are being rewarded for providing that service."

Pinterest did not respond to a request for comment.

[Augustincarlos]

I Would like to say thanks for sharing this article...Most of consumers have addict in this social media sites only,because they are done extremely well and monitoring some affiliate links to swap high profits by using virtual pin board interface..
<a href="http://www.apptha.com/category/theme/Wordpress/Pinterest-theme/">Pinterest Template</a>

[3pugmama]

How does all this affect us...the people who use Pinterest?...All I'm doing is posting things I like or would like to have.

[stevegarfield]

Hi Chenda,
I think that Pinterest actually leaves external affiliate links alone and only ADDS it's affiliate link when one does not already exist.
I tested this this morning.
I also made a post about it.

Pinterest is adding it's own affiliate code behind some product pins when they don't already have affiliate codes.
http://offonatangent.blogspot.com/2012/02/pinterest-is-adding-its-own-affiliate.html
&#8212;Steve

[sunshinetricia]

All of these articles about Pinterest and Skimlinks are missing the point. Affiliate marketers do not have a right to post their links on Pinterest to begin with. If they do, they should expect that Pinterest has the right to overwrite them. In addition, merchants can opt out of Skimlinks or having their links placed on Pinterest. If the merchant is trying to use Pinterest to generate traffic, it can't complain that Pinterest is getting something out of it. The merchants need to understand their affiliate programs or hire someone to manage them for them so that they do not lose money.

Please take a minute to read the opposite side of this story, which I don't think was represented at all: http://www.tricia.me/2012/02/08/pinterest-links/

[joeldgarcia]

I agree with your comment and would only add that the main point of contention, for me, is that the relationship between Pinterest and Skimlinks had not been disclosed. Without this disclosure merchants had no clear reason to consider the option to change their affiliate relationship with Skimlinks. I agree Pinterest has every right to monetize but feel it would have been better to be more transparent about how it was doing so, giving merchants that opportunity for choice.

I have seen many merchants excitedly promoting Pinterest without any knowledge that return traffic would possibly carry an affiliate commission.

[JGBMarc]

Fully agree with Tricia. They have every right to monetize, and they are doing nothing wrong not even with respect to the FTC's disclosure rules. If anyone is posting links to stores with Affiliate programs, Pinterest should do exactly what they're doing by converting those links on the fly to tracking links that earn them $ when a customer buys.