Do research about the topic that the news article addresses. Find related articles(from various sources including newspapers, magazines, websites, or books)that provide background information and different viewpoints. Identify key dilemmas or issues,gather related information and data,discuss relevant theories underlying the events,and carefully consider any alternative arguments.
1) A brief overview of the topic2) Additional information relevant to the topic3) Analysis of the issues using theories and concepts from this course 4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
https://www.nytimes.com/2024/03/12/business/dating-apps-tinderbumble.html
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
Dating Apps Have Hit a Wall.
Can They Turn Things Around?
The apps have changed our love lives, but they haven’t been able to convince
enough young users to pay.
By J. Edward Moreno
March 12, 2024
As online dating became as easy as swiping a finger across your phone screen, the
companies who own apps like Tinder and Bumble became Wall Street darlings. But
about a decade later, those platforms are now struggling to live up to expectations,
and investors have grown frustrated and eager for something new.
Match Group and Bumble — which make up nearly the entire industry by market
share — have lost more than $40 billion in market value since 2021. Even in an age
when the apps are a staple on people’s smartphones, the two companies are laying
off workers and reporting lackluster revenue growth.
Both companies have recently brought on leaders who have vowed to experiment
with new features, hoping to capture the growth investors crave. But they face one
critical obstacle: Not enough young people are willing to pay for subscriptions to
dating apps — partly because younger daters are increasingly looking to platforms
like Snapchat and TikTok to make connections — and it’s not clear what will
change that.
Match Group and Bumble generate the bulk of their revenue — about $4.2 billion
for both companies last year — by selling subscriptions, with smaller income
streams from advertising. But they’re struggling to grow those sales. Match Group
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
was able to keep revenues steady last year only by raising its prices.
As far as investors are concerned, the businesses need to convince more young
users to pay.
“Wall Street loves subscription models because it gives them the comfort of
recurring revenues,” said Youssef Squali, an analyst at Truist Securities.
By paying, users can unlock features like unlimited swipes and the ability to see
who has swiped on them. But for many people, that’s not enough: Unlike other paid
subscription services, like Spotify or Netflix, dating apps can’t guarantee that you’ll
find what you’re looking for.
“It feels really different to pay for access to people,” said Kathryn D. Coduto, a
Boston University professor who studies dating apps. “Paying for it makes it feel a
little skeezy.”
In the United States, 30 percent of adults, and over half of adults under 30, use
dating apps, according to a survey by Pew Research Center that was released last
year. About a third of dating app users reported paying for them, with men and
higher-income adults more likely to pay than others, the survey found.
Millennials, the nation’s largest generation, were prime dating age when Tinder
first rolled out, but more and more of them have married in recent years, a decision
that usually results in people quitting the apps. Now the primary users are from
Gen Z, a younger — and smaller — demographic with less disposable income. That
generational shift poses a challenge for the dating app industry.
Mandy Wang, an 18-year-old student at New York University, said she preferred to
meet people in person or through a direct message on platforms like Instagram or
Snapchat. Dating apps are for casual use, “like a game,” she said.
“People use dating apps, but I don’t know anyone who pays for it,” Ms. Wang said.
In fact, she said that she would consider it an “ick” if she learned somebody was
paying for a subscription.
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
Jess Carbino, a former sociologist for Tinder who is now a consultant and dating
coach, said younger people “still feel a desire to use online dating apps, but they’re
not necessarily experiencing a sense of urgency to find a partner.”
“I think what we’re seeing is purely a demographic shift,” Dr. Carbino said.
Match Group and Bumble declined to comment on their plans to draw in more
paying users, pointing to public statements made by their executives.
Bumble’s chief executive, Lidiane Jones, told analysts last month that the company
would be revamping the app to appeal to more users, particularly younger ones, by
adding “personalization and flexibility” to the experience.
Bumble’s larger competitor, Match Group, was an early player in the online dating
market, starting with Match.com in 1995. The company acquired Tinder in 2017 and
Hinge in 2018, kicking off a period of growth that caught investors’ attention.
Tinder is the largest brand in Match Group’s portfolio and the most popular dating
app in the United States. It shook up the industry landscape in 2012 when it
introduced a swipe feature, which is now ubiquitous in dating apps. But the swipe’s
novelty has worn off, and Tinder has lost momentum. The number of paid users on
the app was down nearly 10 percent in 2023.
Tinder’s struggles, and those of the broader dating app industry, are in part
because the format is substantially the same as it has been for more than a decade,
said Zach Morrissey, an analyst at Wolfe Research, a financial research firm. But
the way people date may have shifted.
“This is a space where product innovation has been relatively muted in recent
years,” he said.
Dating app company stock performance since Bumble I.P.O.
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
+50%
Bumble
Bumble
Bumble
0
−50
−100
2021
Match
Match
Match
Group
Group
Group
2022
2023
2024
Source: FactSet • By The New York Times
That’s starting to hurt. Bumble, which went public in 2021, initially jumped in value
but after a steady slide its stock is now about a quarter of its I.P.O. price. Match
Group’s stock price reached a high of $169 in 2021. It now sits at $34, about a fifth of
its peak value.
Match Group and Bumble have made some changes recently to convince investors
that they can spin things around, but it’s unclear what will solve their problems.
“There’s not an obvious silver bullet that they need to address,” Mr. Morrissey said.
Both companies have had some leadership shake-ups: In January, Ms. Jones joined
Bumble, and Match Group promoted Faye Iosotaluno, the former chief operating
officer of Tinder, to be the app’s chief executive.
Bumble announced last month that the company was laying off about a third of its
work force in the first half of this year. It also lowered its revenue forecast for the
first quarter, below Wall Street expectations.
“The demand for connection and love continues to be really strong — two billion
single people around the globe,” Ms. Jones told analysts in February. “Yet the
products that are bearing the set of experiences to create those connections are not
serving users the way that they want to.”
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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4/9/24, 1:47 PM
Dating Apps Have Hit a Wall. Can They Turn Things Around? – The New York Times
Match Group’s chief executive, Bernard Kim, told analysts in a Jan. 31 earnings call
that this year Tinder was “adopting a fast-fail mentality, a strategy that prioritizes
rapid experimentation and testing.” Mr. Kim took over the company in 2022 after
previously serving as president of Zynga, the maker of mobile games like
Farmville.
He said that the company would attract more paying users through marketing and
that it was adjusting its products in various ways, including introducing new à la
carte premium features.
Match Group has also expanded its offerings, like a service for L.G.B.T.Q. dating,
called Archer, and one marketed toward Latinos, called Chispa. Revenue from
those products was down 4 percent in 2023.
Mr. Kim said that Tinder was reimagining the swipe feature altogether and would
be rolling out new functions this year. The platform is also pushing for more users
to get verified, a move that’s aimed at improving safety and helping women feel
more comfortable using the app.
The activist investor Elliott Management, which previously led shake-ups at
Salesforce and Pinterest, took a $1 billion stake in Match Group in January, a sign
that Wall Street sees an opportunity for growth.
Elliott declined to comment on its discussions with Match Group. Mr. Kim told
analysts that he and the firm had “collaborative dialogue.”
Despite the challenges, the dating industry isn’t going anywhere, said Ken
Gawrelski, an analyst at Wells Fargo.
“Dating, overall, and love, more generally, is a core human behavior,” he said. “So
it’s hard to believe that changes materially. But the way we date, or the way we
find matches, is very much an issue in this discussion.”
J. Edward Moreno is a business reporter at The Times. More about J. Edward Moreno
A version of this article appears in print on , Section A, Page 1 of the New York edition with the headline: With Lackluster Growth, Dating Apps Are
in Need of a Spark
https://www.nytimes.com/2024/03/12/business/dating-apps-tinder-bumble.html
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