Match Investors Anticipate Company’s Plans Beyond Tinder

Match Group
  • Thursday, November 02 2017 @ 09:23 am
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Match Group

Match Group LLC stock got a boost in early October, thanks to the success of Tinder Gold. The new premium app was among the top apps in the Apple Store, not just among dating apps, but alongside Netflix and Pandora. Match shares were up 3.6% Wednesday October 11, and the stock has jumped more than 50% since the start of the year.

But one question on investors’ minds is: what should we expect from Match Group’s other dating apps?

Match Group owns four of the five most popular dating sites, including Match, OkCupid, Plenty of Fish and Tinder, along with several niche dating sites. The problem for investors despite the good news is that these older sites have gotten less attention in Match Group’s overall valuation, because they aren’t generating the users or attention that Tinder does on an ongoing basis, despite their longevity in the online dating market.

The launch of Tinder Gold has been a boon to Match Group, with many users willing to pay for the privilege of seeing who swiped right on them first, before they swipe. While the appeal of Tinder has always been its game-like interface, many users tried to get around the system by swiping right on everyone, increasing their chances of matching. But when Tinder limited the number of swipes a user could make per day, figuring out who liked you first became a valuable tool.

The focus on Tinder Gold may change, thanks to the introduction of video features to Tinder and other apps in Match Group.

Match Group plans to roll out new video features on its “core apps,” aiming to boost their appeal. Taking a cue from Snapchat and Instagram, video is a popular feature on social media and therefore translatable to dating apps. Short video clips could offer valuable information about potential matches, and also make the apps a little more intriguing and sticky for users.

Barron’s and other market analysts have shared some optimism for the success of Match Group stock, but cautioned that the expense of increased server capacity to handle video meant that Match’s profit margin might be negatively affected going forward. Some analysts have advocated for Match to increase its marketing budget to solidify its brand and positioning in key markets, which is another expense that might impact extra revenue streams.

That said, Tinder Gold continues to perform well since its launch at the end of August, and other dating apps are expected to increase revenue as well. Analysts and investors will keep on eye on Match Group, as their companies often set the trends in the online dating industry.