The development of the mobile app sector plays a large part in the dating industry’s growth in popularity over the past few years, successful in ‘normalising’ the notion of dating online. Nonetheless, it can be notoriously difficult to garner a sustainable revenue stream from apps – something that can often put investors off, as highlighted by tech adviser Andrew Chen earlier this year. However, with an estimated value of more than $3.4bn, this clearly isn’t a problem for Match Group. By operating as a group, the company can maintain a stable income across its variety of products. While some may generate less income like Tinder, they’re still important for driving sector innovation.
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Moreover, a portfolio approach is also important in helping us to adapt to shifts in the market. It means that we can adapt easily to different variables such as the ageing population, broader consumer interests and the growth of on-the-go lifestyles, better catering to consumer demand. It’s no secret that consumer retention is limited and difficult to sustain, thus having an impact on growth and revenue. Cross-selling members between products is an opportunity only afforded to those that take a portfolio approach. While Match Group doesn’t appear to be actively cross-selling at present, at Venntro Media Group we’ve found this to be a successful way of retaining and engaging our customers. The core benefit is that this reduces built-in churn and acquisition costs. In fact, the propensity to subscribe increases by 33 per cent when a customer is a member of more than one site within our portfolio. While offering multiple products is important, the biggest opportunity for expansion for dating businesses is to explore services that maintain a relationship with consumers after they’ve found a relationship. Lifestyle products that help consumers to develop their own relationships, such as social networks, booking apps and lifestyle apps, like Dojo and Avocado, have huge potential in allowing dating businesses to increase the lifetime value of their customers. In June this year, we launched Venntro Ventures, our corporate venturing division. Acting as an incubator to nurture and invest in new tech startups, this is essential in enabling us to stay on top of emerging trends and markets. While a tried and tested model is great, innovation is crucial and the Match Group are acutely aware of this; in fact, Tinder came out of the group’s own incubator. It’s an exciting time for the online dating industry. Looking at what our peers have done well, the key to growing a successful and profitable dating business is to scale, diversify and execute brilliantly. Get it right and you’ll be swiping right all the way to Wall Street.
Ross Williams is the founder and CEO of Venntro Media Group, the UK’s leading online dating and lifestyle company which hosts 25,000 dating sites around the world
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