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You may have heard all the ruckus about Pinterest of late and wondered, why is this such a big deal? It looks like this is just a successful social networking site that is driving lots of traffic to my Etsy shop. Well…not exactly. Read on and I’ll explain how sites like Pinterest really make money. Note: I am using Pinterest as just one example of a type of website/business model that is growing rapidly.
Pinterest makes money by directing traffic to websites who agree to pay it commissions on clicks. These sites are called “affiliates” and the business model is called “affiliate marketing”. I give you this information so you can do your own research on this should you be so inclined.
So there you are, working away at growing your Etsy shop and you get an email from an online store with what sounds like an offer you can’t refuse. The online store will guarantee you tons of traffic to your Etsy listings. The best part, there are no fees, they do all the work and you only pay a 5% commission when something is sold. How can you loose, right?
When you agree to all this free traffic, you also agree to let the online store import all your Etsy listings. This will be easy as clicking the ‘agree” button. They do all the work, and there is no cost to you unless they actually sell something.
They import your Etsy links and mount them on their site. Then they have computer programs post those listings like crazy on sites like Pinterest. Pinterest (and LOTS of other sites like it) is based on code (example: http://www.skimlinks.com ) that works in the background to secretly redirect clicks to affiliate sites where they make a commission. In fact, the system is engineered to seek out the affiliate site that pays the highest commissions. Remember that commission you agreed to ONLY if something sold.
You might think that lots of people are going to click directly to your Etsy shop too, but the system is expressly engineered to make sure that does not happen. It’s designed to redirect ALL interest in your work through the affiliate that pays the highest commission and you end up paying fees to the affiliate AND Etsy. But its much worse than that. You also cede copyright control over images of your work when you fall into these schemes.
A lot of artists are being lured into this right now because they think sites like Pinterest drive free traffic to their sites. Pinterest did not invest millions of dollars developing their system to give you free traffic. The other shoe is dropping. Heads up.