Spark Networks

Spark Networks had a disappointing quarter 4 in 2008. From the press release:

2008 was a mixed year for us. We achieved moderate annual revenue increases in Jewish Networks and Other Affinity Networks, improved Contribution margins to 74%, cut Operating Expenses by 19%, drove annual Adjusted EBITDA to record levels at a 28% margin and returned capital to stockholders by using cash flow to repurchase 21% of the shares outstanding at the start of 2008 ... we are disappointed with second half trends and in particular the fourth quarter, as revenue and subscribers decreased sequentially in each online segment. 2008 revenue, excluding General Markets, was flat while fourth quarter revenue, excluding General Markets, declined 3% sequentially. Jewish Networks was flat in 2008 but saw its third consecutive quarter of declines.

General Markets was Spark Networks flag ship dating site once, Americansingles.com. For over the last year American Singles has lost a large number of members. Spark Networks current flag ship site is JDate, the online Jewish Network.

Spark Networks released their 3rd quarter financial results this past week. It wasn't a very good quarter for the company when compared to 2007 Q3 and last quarter.

Revenue for the third quarter of 2008 was $14.0 million, an 11% decrease compared to $15.8 million in the third quarter of 2007, and a 6% decrease compared to $15.0 million in the prior quarter. Revenue for the nine months was $44.1 million, a 10% decrease compared to $49.2 million for the same period last year.

Subscribers are also down.

For the last number of years eHarmony has been playing up the fact that a large number of people get married everyday who originally met each other on their dating site (current published average is 118). JDate appears to be copying this market tactic. They are currently advertising:

Each day over 60 people tell us they found their soul mates on JDate.

Finding a soul mate is not the same thing as being married but it does lead people to believe it is something more than love. It makes it appear as if the relationship may be leading to marriage. 60 is a fairly large number for a dating site which serves a specific niche. I wonder if we will see other popular dating services following suit and start advertising similar facts.

See our JDate Review for more information on this Jewish matchmaking service.

Spark Networks sent out a press release a few days ago about a new website of theirs called Facelink. This site allows visitors to search for singles across 20 of Spark Networks dating websites. Some of these sites include AmericanSingles, JDate, BlackSingles.com and ChristianMingle. Facelink is currently in beta.

The tool is very simple and allows visitors to select what gender they are looking for, age range and a text box where you can enter in keywords which describe the most important attributes of your match. When you search, the site will then bring up any matching profiles with the profile handle, introduction and location. When you click on the profile name in the results, you are then taken to the full profile page on whatever dating site the profile resides on.

I realize Spark Networks is going with the KISS philosophy and Facelink works but, it could use improvements. The search results contain the location but, on the search page you must enter the location in the text keywords box. I think location needs to have its own text box with a radius selection (ie anyone within 15 miles of current location). I also think it is important to list what site the person is on in the search results. This is important as someone who has joined JDate (a Jewish dating site) most likely will not want to date someone practicing another religion. Keyword searching also seems to be limited to the introduction essay and location. Why not include all aspects of the profile. If someone likes watching Lost and mentioned this in Fun Facts, I doubt they would reiterate this point in their introduction. Someone using "Lost" as a keyword for searching may be missing out on a potential match.

I do think the site could use a name change. The name itself FaceLink, instantly brings up comparisons to Facebook, in which the site does not have a whole lot in common with. In the title, the link part works but, maybe they should of tried getting the DatingSiteLink domain or something similar. One thing I did have a laugh at was Spark Networks disclaimer at the bottom of the site.

THANKS TO THE GREAT STATE OF NEW JERSEY, THE GARDEN STATE, HOME OF THE TURNPIKE, GOING DOWN THE SHORE, MYTHICAL HOME TO TONY SOPRANO, AND THE ONLY PLACE WHERE PEOPLE GREET EACH OTHER WITH "REALLY, WHAT EXIT YOU FROM?," WE ARE TELLING YOU, SPARK NETWORKS LIMITED DOES NOT CONDUCT BACKGROUND CHECKS ON THE INDIVIDUALS WHOSE PROFILES CAN BE ACCESSED THROUGH THIS SITE. THE HOME OF THE BOSS HAS GOT YOUR BACK AND WE SUPPORT THEM 100%! NOW DON'T FUHGEDABOUTIT.

This is in reference to the new flawed Internet Dating Safety Act which requires dating sites to notify visitors from New Jersey if the dating site performs background checks or not.

Facelink gives Spark Networks a way to tie all of their dating sites together and allows visitors to search all the sites at once. It saves visitors from having to visit each one individually. Once out of beta they should promote Facelink on all of their dating sites instead of showing other ads.

Click here to visit Facelink.

With all the news about internet dating safety bills lately, I noticed that the Spark Networks dating sites have a new warning at the bottom of their home pages. Here is the text I am referring to as quoted from AmericanSingles.com:

Spark Networks Limited does not conduct background checks on the members or subscribers of this website.

I wonder if this background checks warning is response to the New Jersey's Internet Dating Safety Act. If so, and since I don't live in the state of New Jersey, it appears they are displaying the message to everyone and not just New Jersey residents.

I've been meaning to post this information for a while.

Spark Networks released their First Quarter 2008 Financial Results on May 1, 2008. Spark Networks revenue for this period is $15 million. This is $1.8 million less from the first quarter 2007 and a decrease of 6% over quarter 4, 2007. It is not all bad news though as operating expenses where cut 27% over quarter 1, 2007 which resulted in a $1.6 million net income. Spark Networks reported a net loss of $1.4 million last year in the first quarter.

As far as subscribers are concerned, Spark Networks in the first quarter of 2008 had 195,325 subscribers. This is a decrease of 16% from 231,313 from the first quarter in 2007 and a decrease of 3% from the fourth quarter of 2007.