Upstart Sites Keeping Facebook On Its Toes

After several tries, it looks like Google (Nasdaq:GOOG) is making some headway against Facebook. Its Google+ social network has more 40 million users.

But let’s face it — that still pales in comparison to Facebook’s global dominance, which counts more than 800 million users, half of whom come to the site every day. In addition, there is still skepticism about the level of engagement with Google+.

Does that mean Facebook impossible to beat? In the consumer Internet world, a lot can happen. After all, other once seemingly invincible platforms – like Yahoo (Nasdaq:YHOO) and MySpace – have seen quick erosion.

Any threat to Facebook is likely to come from an upstart that offers some unique twist and has a team that is extremely hungry to win. One worthy candidate is Tumblr, which is a mash-up network of blogging, pictures and videos.

And there’s another recent entrant: Pinterest. It’s kind of like a social corkboard. Simply put, you can “pin” pictures through your browser’s toolbar from just about anything, such as weddings, parties, hobbies, recipes, etc. Then you’re friends can comment on them. Or you can follow the pins of your friends, which can inspire new ideas, such as for something to cook, or an interesting new product to check out.

It’s a simple idea, but it has lots of power. The site is visually appealing, which is important since it should help Pinterest go beyond the typical early-adopter hacker community and get traction with the mainstream (70% of its current audience is female). Site aesthetics have been critical for Facebook’s success.

So far, Pinterest has gotten lots of traction. Just in the past five months, the user base has spiked more than 700%, to more than 3.3 million, and that’s still just on an invitation-only growth model.

As a sign of the site’s appeal, major brands have been setting-up their presence on Pinterest. These include companies like Whole Foods (NYSE:WFM) and Williams-Sonoma (NYSE:

WSM). Plus, Pinterest has raised $27 million in venture capital.

It’s true that Pinterest is still fairly new and it may ultimately flame out – that’s the norm in the wild world of social networking. But the strong success of Pinterest does point out that online users are always willing to try something new – which serves as a warning for Facebook.

Tom Taulli runs the InvestorPlace blog “IPOPlaybook,” a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli. As of this writing, he did not own a position in any of the aforementioned stocks.

 

Tom Taulli is the author of various books. They include Artificial Intelligence Basics and the Robotic Process Automation Handbook. His upcoming book is called Generative AI: How ChatGPT and other AI Tools Will Revolutionize Business.


Article printed from InvestorPlace Media, https://investorplace.com/2011/12/pinterest-facebook/.

©2026 InvestorPlace Media, LLC