Dating apps previously focused on millennials (18-34 year-olds) but now dating apps like Tinder Inc., The League App Inc. and happn are focusing on “older singles” as they are more willing to pay subscriptions.
The New Focus on 35-55 Year-Olds
According to Pew Research Center and IBISWorld, an industry research firm, people aged 35-44 are more than twice as likely to pay for online dating as 18-24 year-olds.
Mark Brooks, CEO of Courtland Brooks, a company that provides business strategy to those in the dating industry, said that daters from 35 onwards, “know what they want and are willing to pay for it.”
The League’s Revenue Increased 10% By Adding Users Over 40
When The League began introducing users over 40, their revenue increased by 10 percent as this group was more likely to pay for memberships.
Tinder also introduced premium features, offering two price bands: $9.99 a month for those under 30, and double for those 30 and above, at £19.99.
Happn, the Paris-based app that connects people who have physically crossed paths with each other, was initially targeted at 18-30 year-olds. Now it is broadening to 30 year-olds and above, using the same model as Tinder, charging older users more.
Dating Apps: the Freemium Model
Whereas dating apps used to emphasize the freemium model, concentrating on building communities quickly, millennials were the perfect demographic to adopt trends and share with friends.
As dating startups start to evolve, they now want to introduce payments to increase profits, where older groups neatly fit in.
For example, Tinder began in 2012 and adopted a model that made the app available for free on a large scale, through word-of-mouth marketing. They also pushed the app on campus social groups, influencers and bars and local hangout spots where young people met up.
Sean Rad, Chief Executive, said, “Our whole strategy was to go after close-knit communities and get them to spread the word.”
Smaller Startups Follow Freemium Model, Building their Base
For startups and apps like Coffee Meets Bagel, happn and Hinge, the freemium model allows them to continue to expand their client base.
Popularity then turns to profitability after they start implementing payments and features that clients are willing to buy.
The challenge comes from fierce competition from apps all wanting to become the next Tinder, which is said to be worth around £1.6 billion as a standalone business in the near future, according to JMP.
Dating Apps: Increasing Competition and Challenges
David Evans, an online dating analyst, said, “I think 10 or 15 launch every week, and at the end of the year, about one or two of them will actually still be up and running.”
“It’s so easy to throw an app out there… The market is flooded by Tinder clones. The ideas aren’t transformative.”
As startups and apps begin to cash in on a $2.5 billion industry, the challenges involved are: the time it takes to get an avid user base and some demographics unwilling to pay for what was a free service.
Will focusing on over 30s dilute the brand’s image, or is broadening the user base a positive step to making more money?