5 Reasons Why Dating Apps Fail

  • Reason #1: New products are designed as a marketing concept based on the “swipe” concept that ultimately reinforces Tinder’s position
  • Reason #2: New launches are done with the same acquisition playbook on a city by city basis, which is capital intensive on a global scale
  • Reason #3: Regular consumer app metrics are applied without considering specific user behaviors
  • Reason #4: An overall blended acquisition cost is measured instead of a granular frequency-based acquisition cost
  • Reason #5: First (and most decisive) marketing budgets are poorly spent

Reason #1: New products are designed as a marketing concept based on the “swipe” concept that ultimately reinforces Tinder’s position

Call it “swipe”, “Like vs. dislike” or any other superficial binary decision on the basis of a physical aspect on what makes a person “attractive” or not eventually disregards user’s identity.

Success in this industry is all about long term differentiation

Judgment = reality — expectations

Reality of the product catches up, it is actually not different from Tinder, you still see the people around you and the app is not able (more than any other location-based dating apps) to show you this very person you have crossed path with. A different reality combined with high expectations and you get a worse judgment than with another app.

Reason #2: New launches are done with the same playbook on a city by city basis, which is very capital intensive to rollout on a global scale

“City by city expansion sucks” mentioned Andrew Chen in one of his post Why investors don’t fund dating.

Reason #3: Regular consumer app metrics are applied without considering specific user behaviors

“What are the KPIs that you follow?”, in 95% of cases people who ask this question expect to hear the same regular consumer app KPIs (i.e. 30-day and 3-month retention, DAU over MAU or WAU over MAU, etc.).
Only a limited number of people would actually drill down to the reasons why some other KPIs would actually make more sense in a specific industry.

Online dating is an industry of its own. You can qualify dating app users as ultra-high-frequency users. The same way ultra-high frequencies work, users’ line of sight is very short (they want immediate result) and their intensive efforts quickly fade away.

In fact, the typical dating app persona uses the app very intensively until finding a potential partner then stop using it, and eventually comes back at it again and so on.

Dating apps, a league of their own (non exhaustive list)

Reason #4: An overall blended acquisition cost is measured instead of a granular frequency-based acquisition cost

The notion of acquisition cost is highly heterogeneous in an ultra-high frequency business. You can’t speak about a blended acquisition cost and judge whether it is good or not.

The trap of user acquisition for dating apps

Reason #5: First (and most decisive) marketing budgets are poorly spent

For any industry, each euro or dollar at the start of a business are determining. And what applies for other businesses should apply here as a rule: at the start budget should always be mostly focused on product development and marketing should serve as an enabler. But for some reasons that I can’t really explain, entrepreneurs and investors think that in the online dating business this is all about marketing spending to get noticed and gain initial traction.

  1. In comparison to many other new services where you can question the ultimate need for it, for online dating services, the need has existed and will continue to exist as long as the internet is up and running.
    When users connect to a dating app, they ultimately want to get in touch with other people and whether they meet or not is not really the question. Leibniz in the New Essays on Human Understanding (1765) thinks that a “virtual” thing, which is only a potential without any guarantee of becoming “real”, is not without effect on the “actual”: it has already set a foot in the real world by its possible “actualization” in the future. But possible “actualization” means somebody at an acceptable distance. Spending on advertisement in a wider area (including regions and countries) can discourage users from the start.
  2. Because money is a limited resource at the start of a business, overestimating network effects (for this specific business) can result in spending too much money sometimes only for the sake of getting new subscribers (which helps building self-confidence, or convincing investors). On the long run and coming back to reason #2, the more you spend at the start the less chances you have to get it right. What difference does it make for a user over a certain period of time to have 10,000 users, 100,000 users or 1m users connected at the same time if he is going to scroll only X profiles?
    For this specific reason, it is important to find the right level of steady growth to support product development and improvement (reason #3).

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