Match and OKCupid, sitting in a tree… Now that the initial hoopla has died down, a few thoughts about the Match acquisition of OKCupid.
For the record, I was misquoted and then did a few rush interviews this week where the published articles made it seem like Match isn’t growing. This is not the case, they kicked some serious revenue growth in 2010 year. Mea culpa.
However, to Match, and everyone else, I am a consultant who blogs. I write this blog to drive new business to my consulting firm. That’s it. I like to see my name on TV and in print from time to time, I’ll admit it, I’m a storyteller more than anything. I blog because I love writing and I’m too lazy to write a book and being on deadline is too much pressure.
I keep getting called an analyst and that makes me unhappy because nothing could be farther from the truth. Analysts work full-time for companies that pay them a salary, and benefits, and vacation days and medical. they look at excel spreadsheets all day long and often have strong finance backgrounds. They have expense accounts and fly around the world talking to companies. Must be nice.
Nobody has the right to be upset with me about what I say about their company or the dating industry. Why? Because nobody talks about anything. A few people do and I value their insights and time like nothing else, but the rest of the industry just doesn’t understand communication, which is ironic.
Ok, on to Match and why the OKCupid deal signals the maturation of the online dating industry.
Five players make the dating market, 25 matter and the rest are there to grab market share wherever they can.
Lets face it, nobody is bigger or better than Match. They won the dating game. Everyone else can launch all the Facebook-based dating sites, niche sites, white label sites, mobile dating sites and whatnot, but subscription-based dating sites with enormous marketing budgets is where its at in terms of making big money in the industry.
Love dating startups, but of all the ways to make money on the Internet, starting an online dating site that isn’t totally niche’d out and well funded, probably not the smarted thing to do with your money. Social media marketing doesn’t work very well, advertising is expensive, there is too much competition and unique and novel features and matching algorithms, while good for dating sites, don’t seem to do much for singles.
Of course there are the dreamers, I LOVE them, they are my fuel, I feast on their brains, but at some point people have to realize that starting a new dating site is like starting a new Google. Are you really going to improve the status quo that much. Doubtful.
Match will continue to acquire specific portfolio companies over time, cherry-picking those which exhibit the right blend of revenue, opportunity, niche-ness and geographic desirability. eHarmony could be a target, so could Mate1 and a few others that I’m not going to speculate on at this time (time-wasting insider baseball.)
I don’t have a $20,000 Comscore account so I’m not exactly sure what the dating site rankings are this quarter (If someone wants to share) but overall, traffic appears to be dropping off at most sites on a year-over-year basis (even though we are in the busiest time of the year). Match up big, most others declining. Except perhaps the social dating apps like Are You Interested and a few ranked around #20 that pull in a $1 million+ every year and who’s popularity is closely tied to their ad spend.
If you disagree, feel free to correct me, I am not a wizard with a crystal ball and I’m here to learn from you just as you are from me.
But Match is clearly the leader. They will do some sort of deeper strategic deal with Meetic, which is the Match of the rest of the world and that will be that. Asia is still a big question mark, and not my speciality, but remains and underserved market as far as I can tell. Its nice to admit I dont’ know everything, less pressure.
Of course there are millions to be made by the rare entrepreneur here and there. These people will be young programmers and expert marketers and not tied into the old-school model of online dating. Meetcha, HowAboutWe, DateBuzz, etc.
Then we have the 25 mobile dating app startups that are trying to copy grindr and other gay apps like Manhunt. They gays are so far ahead of straight mobile because they got it a long time ago and its a perfect fit for the demographic.
Mobile is a feature of a big site. but the current model is loads of tiny startups fighting a bloody battle for attention. Few of these companies are exhibiting the DNA required to be the Foursquare of dating. Creating mobile apps is straighforward, so we’re left choosing between the UI and market awareness, which again is too expensive for all but the well-funded.
Newsflash, location-based dating is just too creepy for the majority of singles. The churning waters of a sea of 25 small mobile apps means geographic dominance in specific markets, but not across the country. Just wait until Foursquare figures out dating.
I’ve received two press releases about new mobile dating startups in the two hours, that alone tells me something is up and that the great gold rush for mobile is going to get bloody and expensive for any clear winners are declared.
Here’s where it would be cool to see Match’s mobile stats. Heck, they used to publish their conversion metrics back in the day.
And there you have a few Friday thoughts. Not an analyst report, no five-hour research session, no interviews and some exhibited bias. I gotta go get ready to be interviewed by HuffPo.
NOTE: I’m posting a Q&A with Match next week which should clarify a few things about the OKCupid deal as well as other issues like the origin of the new subscribers (acquisitions vs. US or International growth), their big wins for 2010 and much more.
