Milestones

SNAP Interactive has made its online dating site Are You Interested (AYI) a priority, and it looks like it’s paying off. The company announced that AYI has become the number one grossing application in US Lifestyle category in the Apple iTunes Store as of August.

The company hit other big milestones, too. In July, its mobile apps contributed to the highest percentage of total logins ever, at 38%. New mobile subscription transactions were up 57% year-to-date compared to the same period in 2013, and total mobile logins were up 33% YTD compared to the same period in 2013.

AYI began as a Facebook-based online dating site, and has since expanded to its service to develop its mobile platform. SNAP said that it has put a huge focus on mobile in the past year, specifically improving the user experience for iPad, iPhone, and Android phones. The goal was to create a seamless cross-platform experience for everyone, no matter what device they were using.

Mobile has become a crucial part of the online dating market, and its numbers are only going up. Traditional online dating sites have been developing and marketing their mobile platforms for this reason – many daters want more ease and accessibility - and don’t want to have to sit in front of their laptops when they can use their phones to connect with potential dates. Popular apps like Tinder, Hinge and Grindr have also created a new market of younger daters who find dating via phone apps to be the most convenient way to meet people.

Snap's Chief Executive Officer Clifford Lerner commented, "Mobile is the primary platform for an increasingly large segment of online dating users, and we were determined to create an excellent experience on all mobile platforms to take a leadership position in the market.  We're excited to be the #1 Top Grossing application in the US Lifestyle category in the Apple iTunes store.  It shows that iPhone users have really embraced the AYI app and user experience we worked so hard on.  We believe mobile is an important engine of growth in the online dating industry, and we're pleased to be one of the leading providers of online dating applications."

Snap's Chief Operating Officer Alex Harrington added, "Mobile is not only strategically important, but also a very lucrative platform for the Company.  In July 2014, approximately 52% of our user acquisitions occurred on mobile platforms, which helped diversify marketing sources and increase marketing efficiency."

SNAP Interactive hasn’t mentioned any future development plans for AYI. For more on this dating service you can read our Are You Interested review.

Dr. Neil Clarke Warren left eHarmony a few years back, only to take control of the company he founded once again in 2012 to implement a turnaround strategy for its drastically sinking subscriber base. As it turns out, this new strategy has been key to eHarmony’s unprecedented recent success. This past week, the company announced that it has the highest number of subscribers in the company’s history, and has grown its base of users 54%.

This is quite an accomplishment, considering the growing popularity of dating apps like Tinder and Hinge. The market is crowded these days, so you have to effectively differentiate yourself in order to compete. Traditional online dating sites have struggled to make their offerings more competitive and accessible.

eHarmony is an especially interesting contender in the online dating industry. Going against the grain of its competitors who offer an easy sign-up process and a high number of matches, eHarmony has a rather lengthy and grueling sign-up process that can take up to 90 minutes to complete before you receive your matches. And you only receive a few matches at a time, ones that are selected by eHarmony, not you. On top of that, there is another “guided communication” process to complete with each match before you can just send them an email to meet for a date.

It seems to be working.

All of these steps are important to eHarmony’s goal: compatibility matching. This was the original intention behind the launch of the site, and founder Dr. Warren has remained firm in this vision, which numbers show is paying off. He brought in a new management team to improve the website and mobile design, the technology, and implement a new marketing program.

As a result, the company has gained subscribers who are also more willing to stay longer and pay more than in years past.

“eHarmony was created as a way for individuals to begin a relationship already a step ahead – with someone who is truly compatible,” said Dr. Warren in a statement. “We are proud of what we have achieved over the past two years, securing the largest subscriber base in our history. We are confident in our ability to continue to grow eHarmony in the future.”

With so many dating sites and apps competing for sheer numbers, it’s interesting that eHarmony’s more serious approach to dating and its focus on the goal - helping people find long-term relationships – is paying off. There is indeed a market, and a need, for people to find and make real-life lasting connections, and the continually growing numbers prove it.

Jiayuan.com, the largest online dating site in China, surpassed the 110 million registered users mark on June 29, 2014.

Jiayuan got its start a decade ago to address the unique needs of China's rapidly growing urban singles population. The website was a pioneer in China's online dating market, and now ranks first in the country in terms of number of unique visitors, average time spent on the site per user, and average page views per user. Over the course of its 10-year history, Jiayuan has facilitated 12.3 million matches in China.

The site has become so big that, according to comScore, it accounted for more than half – 58.4% to be exact – of the total time spent on online dating in China in March 2014. It is the 60^th most visited website in the country according to Alexa.com, and the 336^th most popular website in the world.

Jiayuan.com hit the 100 million registered user accounts milestone back in January 2014, adding 10 million more users over the course of the last six months. "I am pleased to see Jiayuan's registered user accounts surpass the 110 million mark as we continue to gain momentum from our solid start to the year," commented Mr. Linguang Wu, CEO of Jiayuan, in a press release. "Passing the 110 million milestone speaks to the strength and growing popularity of our platform as we make the investments needed to increase our brand equity and solidify our leadership over our competitors. These investments include ramping up mobile monetization now that we have successfully grown our mobile platform to include 24.8 million registered user accounts and 31.2 million activated installments as of June 29, 2014."

One of Jiayuan’s recent investments is a partnership with animation firm Up Studios, whose brand Piggy in Love (which follows a pig looking for his lost love) will be featured in Jiayuan’s new mobile app. Through their licensing agreement, Jiayuan users will be able to send romantic animations and Piggy in Love emojis in their messages.

Mr. Wu concluded, "Looking to the future, we will continue to build upon this massive database of marriage minded singles by integrating it with our proprietary CRM system in an effort to consolidate the traditional matchmaking business in China which we believe is poised for a period of explosive growth. 2014 is an important year for us strategically as we make investments in our database of eligible singles to generate new revenue streams and ensure the long-term sustainability of our business."

MillionaireMatch.com has just surpassed the 2 million member mark and is celebrating with a new digital billboard in Times Square.

“Join the 1%: Don’t get left behind,” the ad reads. It's a slightly odd choice, given the bad rap of the 1% and the fact that the term was coined due to protests in New York City in the first place, but it also begs the question: how many MillionaireMatch.com users are actually millionaires?

Darren Shuster, North American CEO for the dating service, recently spoke with MarketWatch about the milestone and their membership. Here are a few highlights from their conversation:

On what it means to be a “certified millionaire”…

“You can become a “Diamond Member,” which shows you have $1 million in assets or a large income, a minimum of $200,000 a year. Then you can search for other Diamond Members who’ve had their income verified.”

On online dating’s notorious reputation for being full of fakes…

“MillionaireMatch has as many fakes as most dating sites. Some people are great, some people are phony, some people get a lot out of it and some people quit in a week. You have to know who is exaggerating and who’s not. Some people say they own the car and the house, but they’re leasing the car and they’re renting the house.”

On sexism…

“People say all sorts of things when it comes to love or money. Women are attracted to wealth whether the website exists or not. We’re not exactly reinventing the wheel here. I’m sure there are people who will call it sexist and call it weird, and will say things like, ‘How could you go after them for money?’ If you met someone and they both have a sense of humor and good physical condition, who would you go for? I’d go after the woman with the big bank account. Wouldn’t you?”

On the clientele who make up the MillionaireMatch userbase…

“Some of these people are making $100,000 a year. On paper, they’re a millionaires. But they’re not necessarily bringing in $40,000 a month. Women are smart and intuitive. It’s almost like crowdsourcing to weed out the phonies. They’re probably our best security.”

And finally, the big question: How many members are actually millionaires?

“That I would rather not disclose, if I can help it. Most of the men have a million dollars or more at least in assets, including their house, and have money in savings. We have a fair share of those.”

To find out more about this dating service you can read our review of Millionaire Match.

Zoosk just filed for IPO last month, but already the hype is huge. Upon the announcement of its plans to go public, Zoosk was dubbed ‘the Netflix of dating’ by the media and investor interest shot through the roof.

The "dating services" industry was valued at $2.1 billion in annual revenue by IBISWorld in September 2013. 68.7% of that figure comes from online and mobile dating services. IBISWorld predicts that the market as a whole will grow by 5% over the course of the next four years. The biggest players in the industry are names that are familiar to everyone, whether or not they have ever used the services: Match.com, OkCupid, eHarmony.

Zoosk may be smaller, but it’s no slouch. The online dating platform has over 26 million members, including approximately 650,000 subscribers across 80 countries. Zoosk’s membership grew from 18 million in 2012 to its current numbers, while the number of paying subscribers over the same period grew from 483,000 to 650,000. The company anticipates continued revenue growth based on its unique business model that’s similar to Netflix or Pandora.

What Zoosk has in common with those two Internet giants is its complex proprietary behavioral matchmaking engine. The technology analyzes your behavior on the site – from who you click yes on to who you linger on a little longer before saying no – to get to know you better (possibly even better than you know yourself). By tracking your actions on the website and evaluating your preferences based on it, Zoosk hopes to be able to anticipate your love life's every need, in the same way that Pandora guesses what kind of music you’ll like and Netflix suggests movies it thinks you should watch.

Of course, the stakes are a little higher when you can't just press pause or hit a skip button when you're not satisfied with the choice. Still, Zoosk is thriving. At the end of 2013, it was the highest grossing dating app and one of the top 25 highest grossing iPhone apps of the year. With a 2.9% market share, according to the IBISWorld report, Zoosk is one of the biggest players in the game.

That being said, Zoosk is not profitable. The company posted net losses of $2.6 million last year and admitted that it “may not achieve or sustain profitability in the future" in its S-1 filing with the SEC. For the future, if the IPO is to be successful (and the company as a whole), Zoosk will need to increase brand awareness via public relations, social media, and advertising. Zoosk must also create an effective system for retaining users and continue to expand its presence on mobile.

For more on this dating service you can read our Zoosk review.

This week’s round of congratulatory applause goes to Zoosk, which just filed its S-1 registration statement with the SEC and announced its plans to raise $100 million in an initial public offering.

The company will trade on the New York Stock Exchange under the symbol ZSK, with Merrill Lynch, Pierce, Fenner & Smith, and Citigroup Global Markets underwriting the IPO. Oppenheimer & Co. and William Blair will also be joining as co-managers.

As part of its filing, Zoosk provided details of its global online dating business.  The company states that the website now has 26 million members across 80 countries, including 650,000 subscribers (users who pay for access to additional features and products). The company also states that its user base grew from 18 million at the end of the year in 2012 to its current numbers, a 44% growth rate. The number of paying subscribers grew to 650,000 in 2013 from 483,000 in December 2012.

As those subscriber numbers have grown, so too has revenue. Revenue increased 63% from 2012 to 2013, rising from $109.1 million to $178.2 million. Net loss also decreased drastically during that period, from $20.7 million in 2012 to just $2.6 million at the end of 2013. Subscriptions account for much of that revenue ($153.8 million), but Zoosk also has a rapidly growing virtual currency business that jumped from $5.4 million in revenue in 2012 to $24.3 million a year later.

On top of that, Zoosk has raised more than $60 million since being founded in 2007. Investors include Crosslink Capital, Keating Capital, Canaan Partners, Bessemer Ventures, ATA Ventures, Jeff Epstein, Plug & Play Ventures, and Amidzad Partners.

While it started out on the web, Zoosk has been hugely successful in the mobile arena. In the Apple App Store it's the #1 grossing dating app and a top 25 grossing app overall. Much of that success can be chalked up to the site's proprietary Behavioral Matchmaking engine, which learns from a user's clicks, messages and other actions to produce more compatible matches. The better the data it gathers, the better its recommendations get.

Looking to the future, Zoosk knows the biggest challenges it will face. The service must optimize its strategy for retaining current members as well as its approach to attracting new members and subscribers. Zoosk must find a way to retain high levels of user engagement and subscription rates and, most importantly, must continue honing its Behavioral Matchmaking engine in order to connect users with mutual attraction.

To find out more about this service you can read our review of Zoosk.