Finding love online is strange, well not today, but it certainly was a few years ago. The advent of dating apps changed how we connect with our significant others.
Remember the times when meeting a person you connected with online was a spooky affair. That unease you felt before heading towards a cafe you decided to meet at. That mysterious glare you got from your friends, and lots of butterflies in your stomach.
The only hope for you, then, was to meet someone you caught your eyes with at a local community function or social get-togethers.
Times have changed.
Millennials have led the transformation, making online dating normal and universally accepted. The increasing number of users and dating mobile apps show how dating business models are progressing.
There are presently more than 1,500 apps working on an online dating business model. The total number of users dating apps accounted for was 270 million in 2020, according to data published on Businessofapps.
Leading from the front and making the most out of the dating app business model are the newer apps popular for casual dating, Bumble, Hinge, and Tinder.
While Tinder holds the highest market share globally with 75 million monthly active users, the second on the list is Badoo with 60 million monthly active users and Bumble with 20 million monthly active users, both owned by MagicLab.
Though casual dating is not prevalent in Asian countries, there are not many players with double-digit monthly active users except Tantan, which has 20 million monthly active users.
Mono, a Chinese social search provider, owns Tantan.
As far as valuation is concerned, Tinder tops the list with $10 billion, followed by Bumble and Tantan with $4 billion and $3 billion respectively.
Apps based on the dating app business models are likely to progress at a steady rate. By 2022, the projected revenue these apps will generate is $3.72 billion which is currently projected at $3.33 billion for 2021.
By the year 2025, the revenue is expected to cross the $5 billion mark, with estimates around $5.71 billion.
The stats reveal that the world of dating online has grown tremendously in the past few years. Moreover, this growth is expected to increase to a great extent in the times to come.
The pandemic is nearing its end (seems so) which means people will soon start to meet their online dates in real life. Though the impact of pandemics would still be seen in people’s habits and behavior. They would be more cautious than ever in terms of hygiene, shaking hands, or hugging in the first go.
Algorithms make the magic work for you.
Talking about the most popular online dating app, Tinder used “Elo score” to match profiles. Not just by monitoring your right swipes (Likes) and left swipes (Not interested), it scored you on the basis of how potential matches react to your profile.
However, according to a recent Tinder blog, Elo score is no longer used to match profiles. Instead, it now tracks who is more active and who is not.
The more you use the app, the better are the chances for their algorithm to find suitable matches for you based on the preferences and data you’ve fed in the app. More active profiles are shown to users than those which are not.
Bumble, on the other hand, hasn’t revealed its search algorithm. It is very similar to Tinder in terms of the swipe model though, except that it doesn’t allow male profiles to initiate conversation.
Only women can start the conversation.
Moreover, the matches disappear if the female profile doesn’t respond within twenty-four hours.
Bumble takes care of inactive profiles (users who haven’t used the app for 30 days) by limiting them to pop on the screen, and users see only active profiles.
Another popular name in the field of online mobile dating business is “Hinge”. It uses the Nobel prize-winning Gale-Shapley algorithm for matching profiles with one another.
To understand this algorithm, let’s consider there are two groups, one group includes 10 men and the other one consists of 10 women. So according to this algorithm, the first group (either men or women) gets to pick their first choice. If rejected, they move to pick the second preferred one. This continues until none is left to get matched.
Not just this, the final match depends on how potential matching profiles react with your profile.
OkCupid is another app based on mobile dating business model - more robust than others mentioned above. It collects a lot of personal info, a total of around 4,000 questions can be filled by users.
It uses a match percentage calculator to find dates for its users. It works simply by finding and matching users with similar search preferences and answers to questions both have in common.
Broadly, the dating app business model can be classified into two categories:
While users were and still are reluctant to buy paid subscriptions of the dating apps, these apps grew steadily over time, how?
How did they continue to nurture a business that involves a variety of critical tasks to address - each demanding a fair chunk of money, like safeguarding user data, creating an engaging user-friendly interface (involving both design and development concerns), attracting new users to the app, and working on several app marketing strategies.
The answer is the “free dating app business model”, which allows users to register and use the app for free, but includes in-app purchases and third-party ads.
The dating app business owners partner with advertisers to show ads within the app to millions of monthly active users to generate hefty amounts in revenue.
Aside from this, free users of the app are offered premium features like extra swipes, boost profile option, featured profile feature, unlimited likes, rewind, etc that come at a price. Free users can unlock special features through in-app purchase functionality.
The “paid dating app business plan”, on the other hand, is a recurring subscription plan, usually for a month or a week, requiring users to subscribe to one of the plans on offer to access the website or app. The most popular example is Match.com, which charges $40 a month. Chemistry, eHarmony, Zoosk are some of the other examples of paid dating apps.
The paid online dating apps target the older group of society who are looking for a serious relationship. Moreover, are willing and able to pay for the subscription plan.
Though we have mentioned a few ways dating apps make money in the previous section, let’s delve a little deeper to understand better.
Following are the top ways dating apps can make money from.
Dating apps can make extra profits by integrating third-party ads, either by partnering with clients directly or by using the service offered by websites like BuySellAds, which connects publishers and advertisers. Both parties (publisher and advertiser) can negotiate on terms before coming to an agreement closure.
Ads can be in the form of images, videos, or banners as per the design of the app. Remember to not degrade the user experience. Get professional help from a premier mobile app development company when working on a dating portal development project for the best results.
Expert suggestions and creative ideas of designers employed at a mobile app development company can certainly bring value to the table, providing just the right balance between user and business.
Dating apps for business owners is a profit-making affair, and until there are appropriate monetization strategies in place, the app is of no use. In-app purchases are one of the widely-used monetization strategies around the world.
Users are served with a variety of chargeable premium features. These can be on the lines of popular ones world is familiar with, including:
You can make the most out of Google Adsense by enabling it within your app. However, ensure that your app doesn’t contain any adult content and does not violate any of the required policies.
The dating business app owners can generate additional revenue by letting clients promote their services or products through the app. The promoted content should, however, be related to the app’s vertical.
You can offer professional relationship advice services through the app helping users to get rid of unwanted relationship miseries from their lives. The relationship experts can also guide users on topics like how to initiate a conversation, how to impress a match, etc.
When working on dating app development, you can ask your mobile app development company to include functionality for sending digital gifts in chats. These can be a flower, a song, a hug, a kiss, and all kinds of premium emoticons.
You can join hands with businesses related to your industry as an affiliate partner and start selling their products or services within the app, making those extra bucks in form of commissions every time a user purchases from the links you publish.
You can introduce subscription plans for users to use all the features of the app - an added advantage over free members. Premium users can be benefitted from features like unlimited likes, read receipts, ad-free app, more filtering options, review profiles, etc.
As a competitive player, you should be aware of what’s ongoing and what’s likely to unfold in the vertical you operate. We’ve simplified your life by listing down the notable online dating trends that you should not ignore.
Around 49% of users in the US used dating apps for an exclusive romantic relationship, according to a Statista report. Only 23% of the users stated that their goal to use dating apps was to have a sexual encounter.
Dating app users like to fill long questionnaires within apps to increase their chance to get connected to a compatible match.
People have started to see dating apps as more than just a casual affair, thanks to the normalization it has got in recent years led by millennials.
2. Video/audio communication
Limiting interaction medium to just text isn’t a good idea anymore. People like to send and receive personalized voice and audio messages. Video chat and video calls are the features a new-gen dating app must-have.
3. Community dating
Apps like Fourplay are using it to revolutionize the online dating landscape. The app allows dating in teams. We believe this is just the start of this trend. We might see more apps joining the league soon.
4. Business collaborations
We are likely to witness more business collaborations than ever in the dating industry in the coming years. Just like the female-friendly Bumble dating app did with Airbnb, offering a virtual dating experience to its users.
Hardballing encourages you to be straightforward about what you want and looking for. It can also help avoid situations that cause stress and uncertainty.
It is the latest trend in the online dating space that gets right down to business from the word go - no messing around or playing games. Being upfront with your intentions and wants can save you a lot of time and effort in the search for a perfect match, believes many dating app owners.
Putting out what exactly you want on your profile can help you connect with the right people, and those who don’t like what you’ve put up can keep scrolling.
In the online dating space, it’s more about a person’s beliefs than anything else. Distance and age don’t matter. Incorporating features that tell more about one’s beliefs. It is something that’s desirable and will help you keep up with the user expectations in the coming years.
Hope this article helped you understand online dating business models, how dating apps make money, and more crucially what to look forward to in this space.
It’s also the time to build your dating mobile app that outshines the best even. Consider investing in dating app development in 2021 to reap benefits you’ve never imagined.
Remember to offer exclusive features that none of the prevailing dating apps offer. Embed uniqueness, and get professional help to validate your idea. Get connected with a mobile app development company to discuss project requirements and estimating the cost and time of development.