Published March 10, 2014
The typical road to funding in mobile apps these days is validate concept > gain traction > scale > get funding or acquired. Revenue streams can wait.
However dating app Tinder not only doesn’t have any visible revenue streams, but has a massive hindering issue around scaling that it will need to solve to maintain users and grow.
At its heart, Tinder is a content curation platform like Instagram. However the difference is that users themselves are the content. This leads to a road block for retention, as in every geographical area growth will eventually slow down — and without new users, there won’t be new content to consume, and users will leave the app. The most engaged users actually experience diminishing returns as they chew through profiles faster than users are acquired.
This problem is compounded by Tinder’s local focus. Unlike more conventional social networks, global growth doesn’t mean a thing to the quality of user experience here — a user in San Francisco does not benefit from new profiles to peruse if Tinder becomes the hot new thing in Johannesburg. There are network effects at play, but they are limited to within the user’s area (understandable given the necessary early goals of validation and traction).
Even now, this handicap is coming into play when new users in an area start becoming few and far between. It also makes Tinder weak as an “on demand” service, which works against its ability to become habit-forming — no new users in your area? Too bad, come back later. While recycling profiles that a user previously said no to helps here, Tinder displays such users only when it wants to. Either way it’s not a long-term solution for keeping users engaged.
With a proven concept and traction, will Tinder now open the floodgates and allow for a more on demand, global experience (facilitating long-distance relationships)?
Tinder is a fascinating social experiment with lots of potential and room for improvement. But how it solves the issue of scale will ultimately be the biggest determinant for any long-term success.
Kevin Oke is a social/mobile game design and strategy consultant.