NEW YORK, Oct 6 (Reuters Breakingviews) – Serial swipers on Tinder are going to pay for that dopamine rush. The dating app owned by Match (MTCH.O) said last week it’s rolling out a subscription tier called “Tinder Select” that will cost $500 a month. The $12 billion company could make even more money if it approached hookups the way computer games hook users.
The company run by Bernard Kim has been struggling to jolt growth at its dating destinations, which include Hinge, OKCupid, and Plenty of Fish. Tinder, its largest brand, grew revenue by 7% to $3.2 billion last year. Competitor Bumble (BMBL.O) expanded its top line at twice that rate.
That’s problematic considering the value Tinder provides to those looking for companionship. The location-based app connects people based on where they are physically standing. This earned Tinder a deserved reputation for being the go-to place for overnight romance. One research study found 51% of users have sex with someone they met on Tinder while less than a third found a relationship. Yet Match isn’t squeezing much more money out of daters-to-be. Its 16.3 million paying users spent an average of $15.97 per month in 2022, just 24 cents more than the prior year.
Match could look to other apps with socially interactive mechanisms for new ways to boost revenue. Candy Crush Saga, a free game where players move pieces to make rows of three or more, sells gold bars for $1.99 that can help users become unstuck. Roblox (RBLX.N), which enables kids to create avatars and 3D worlds, similarly allows players to buy a-la-carte add-ons.
Adding game-like micropayments could help Tinder, which has around 75 million active users but only 10.5 million paying subscribers, according to Business of Apps. Conservatively assume these users swipe right or left on the app 1 billion times a day, and that Tinder was able to charge a penny per swipe. That would bring in $3.65 billion a year – more than Match’s expected revenue this year. By contrast, if a hefty 1% of Tinder’s current subscribers sign up for Tinder Select, they will pay an extra $600 million.
Not everyone may be so trigger-happy, and technology companies have to tread a fine line between extracting payments and alienating users. But Tinder’s new package suggests there’s still room for more price discovery in the short-term canoodling market.
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Match’s dating app Tinder is launching a premium service named “Tinder Select” for $499 a month. The new subscription offers perks including the ability to be seen by more users.
Editing by Peter Thal Larsen, Sharon Lam and Aditya Sriwatsav
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