The weeks leading up to Valentine’s Day are always an interesting and entertaining time of year as both men and women scramble to find that special someone.
Luckily, the rise of mobile dating apps in recent years has made it increasingly easier and fun to connect with a partner. And based on the data…singles really like these apps and their benefits (especially Tinder). Much of this early success can be attributed to their adoption of a platform business model over a linear model.
We began our analysis by identifying key hurdles these dating apps faced. First, they needed to disrupt established platforms like dating sites. In order to disrupt, they had to grow users and increase engagement on the platform, no easy task. The strategies used by these mobile dating apps to overcome these hurdles help uncover key lessons on what it takes to establish a platform. These mobile apps’ successful interaction and discovery models can be replicated and extended to other verticals looking to provide more meaningful and valuable experiences for users.
Question #1: Match.com and OkCupid are alive and well. How can new entrants disrupt their market leadership?
A: Take advantage of emerging technology.
Dating platforms are not a new phenomenon. By definition, platform businesses create value by facilitating exchanges between user groups. Bars and nightclubs are early examples of dating platforms. In the 90’s, websites like Match.com started to take advantage of the Internet and were the first digital dating platforms. The rise of mobile and improved connectivity allowed for new platform businesses to disrupt the dating . These apps were disruptive because of their astute application of emerging technologies to create novelty, thus launching their platforms.
Tinder’s early adoption of geo-location data into the discovery and matching process is an example of a dating platform using emerging technology to achieve unprecedented unparalleled reach and engagement. Happn took it a bit further by using geo-location data to connect people who had crossed each other’s physical paths at one point in time.
More recently, dating apps are using social graph data to power their discovery algorithms. Coffee Meets Bagel and Hinge tap into Facebook data to connect singles that share mutual friends. The League scans an applicant’s LinkedIn profile to decide whether or not users are qualified to join their exclusive community of users.
Dating App Trend #1: Discovery on mobile dating platforms is increasingly powered by social graph over geo-location data.
Question #2: How do you keep users engaged?
A: Reduce friction in the discovery process.
It is important for modern platform businesses to focus on reducing search and transaction costs for users in order to fuel more meaningful transactions.
Dating mobile apps achieve this during the sign-on process. They don’t require users to fill out lengthy sign-on forms, but instead allow for social sign-on through Facebook, Twitter and/or LinkedIn.
Successful exchange platforms also provide increased efficiency when it comes to search and discovery. In a crowded dating app scene, curated matchmaking has become increasingly important.
Tinder arrived with much fanfare and excitement. After a while, Tinder’s discovery created too much friction for certain users as randomized geo-location recommendations started to fall out of favor. Certain apps responded to this by reducing the randomness and anonymity of their discovery process by curating their users’ potential partners. One can imagine the discomfort some users may experience with the randomness of geo-based dating recommendations. Additionally, it can be quite time consuming to swipe through Tinder’s never-ending catalogue of users. Hinge does away with some of this unnecessary friction by providing users with more curated potential matches on a daily basis. Coffee Meets Bagel delivers more desirable prospects to your smart phone’s front door as well.
2015 Trend: Mobile dating app users are open to the platform curating who they potentially connect with.
Question #3: How do you solve the chicken and egg problem?
A: Cater to a specific user group to increase their participation.
One way to overcome the chicken and the egg problem is to attract users by subsidizing value. Value can be subsidized on one or both sides of the platform to achieve this effect. Some of the more successful dating applications have used a combination of user sequencing and . User sequencing involves prioritizing the acquisition of higher value users in order to attract others in the ecosystem. Product feature subsidies provide differentiated functionality to certain users in an effort to increase their usage.
Two dating applications that have implemented user sequencing as part of their initial strategy are Tinder and The League.
The Tinder cofounders took advantage of their alma mater, USC, to fuel early user adoption. The company sponsored parties geared toward USC fraternity and sorority members where individuals were required to download Tinder upon entrance, which created an initial base of users to build off of.
The League is attempting to provide a dating platform for more “elite” singles looking to make more meaningful connections and avoid the embarrassment of appearing on Tinder. Their platform fulfills demand from users who want a more exclusive dating experience.
Bumble and Wyldfire are two emerging dating apps that have used product feature subsidies. Bumble and Wyldfire both identify women as the more influential user group in the dating equation, reasoning that female participation in the ecosystem will attract participation from men.
Bumble’s platform allows only women to initiate conversations. Wyldfire differentiates the signup process for women and men; all women are granted free access to the app but men must either be invited or approved by a female. Both feature subsidies incentivize women participation by giving them the power to function as gatekeepers in the platform.
2015 Trend: Dating apps have found success in positioning their experience as opposite to Tinder’s. Users seem to demand more accountability through high platform selectivity and better controls.
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