Month: February 2006

NEWSWEEK — Feb 27 — Feb. 27, 2006 issue – Mark Brooks, editor of consumer watchdog Online Personals Watch, says the industry stands at a crossroads. "I keep hearing that the industry is slumping," Brooks says. "No, it isn't, but we have got to get our act together."  Online dating in the U.S. has reached what Jupiter Research analyst Nate Elliott calls "a point of critical mass."Last year the number of users posting online personals fell "marginally," according to Jupiter, and revenue growth is expected to drop to just 6% this year, down from 77% in 2003. The total U.S. market is now worth $521 million. (In comparison, online gambling sites took in an estimated $10 billion in worldwide revenue last year. Porn sites took in $2 billion in the U.S.) The European market is still growing in high double-digit rates.  One reason for the slowdown is that the curiosity factor has worn off. Heather Hopkins, director of research for Hitwise UK says the sites are now focused more on getting current visitors to sign on as paying customers. This love slump is a bit of mystery. Indeed, it may be just a lull. Brooks predicts that the industry will see "a huge upswing" as sites add new services like Web-camera dates, help arranging dream dates and psychological profiling that attempts to find you a soulmate, not just a hunk with the right hobbies and salary profile. Others say the industry needs to move beyond just dating. Bill Tancer, Hitwise GM global research, says e-dating is following the normal trajectory of Internet businesses. "There is an environment of hypercompetition where markets are born, grow, plateau and decline, [but] it's not that the activity itself is going to go away." Instead, he predicts, dating sites will evolve into broader forums for social networking.  There are signs this is already happening. Meetic is offering a mobile-phone network called Superlol, allowing users to form groups around common friends and interests.

Mark Brooks: Reporters are writing about the demise of the online dating industry, which is very unfortunate.  I believe we are, indeed, at a turning point.  To get to 'online personals 2.0' we need to add services and refine our sites to help put people in front of people more quickly, in greater numbers and with better matches.  (i) Personality profiling holds high promise, but needs more research.  Profiling companies should embrace academic resources and share data with them.  Let's lose the 'magic box' approach.  Users are becoming more sophisticated and want to know how personality profiling works.  Let's tell them.  And, if you're going to offer personality profiling, show matches what potential failure modes/conflicts their relationship might be susceptible to, and educate them on how they might communicate and deal with those conflicts.  (ii) Add events.  They're a pain to coordinate, but are a great way for people to meet and have some instant gratification.  They can buy a ticket and meet a roomful of singles immediately.  Then they can go and check the profiles of the people they have chemistry with to see if they are a match on preferences such as 'want kids?'  (iii) Improve safety.  Let's advise users more clearly.  They should: 1. not share contact info, 2. meet in a public place, 3. let someone know where they are going and call in to them after one hour.  Background checks are a long way from being foolproof, but are better than nothing, and worth considering.  (iv) Remove dead and unresponsive profiles, or at least indicate they are unlikely to respond.  Anyone who has not logged in or has not responded to a message for 4 weeks should not be listed as a live profile.  Let's set expectations realistically.  It's good for the industry in the long haul.  (v) Consider adding/partnering with matchmaking services for the users who have money, but are time starved.  People are paying $50 a month for profiling sites (i.e. eHarmony.com, TRUE.com, PerfectMatch.com) because they have money and want some handholding.  Let's up the ante.  (vi) Improve search.  A friend of mine is Indian.  He only wants to meet women who are interested in Indian guys.  He'd like reverse search please.  Niche sites are popping up for every imaginable preference.  Generic sites need to broaden search criteria and functionality or have the niches further incur on their membership revenues.  (vii) Add content.  Do you know your audience?  Really?  Then engage them with targeted, mind blowing content that lights their fires, educates and keeps them hooked on your site.  Match partnered with Dr Phil.  Community Connect, Gay.com and Nerve.com know content.  Guide, engage and captivate your users.  (viii) Find targeted advertising partners.  Find offers with top level brands to improve your brand.  Yahoo + Starbucks.  There's some great branding affinity there.  Brand = Trust.  Advertising on online dating sites doesn't tend to bring in much money, but it CAN improve your brand trust and capital if you find the right partners and negotiate suitable offers.  Extend your brand into the real world.

Online dating is not taking a downturn.  $516 million U.S. online dating industry revenue for 2005 barely scratches the surface of the market potential.  Industry revenues are growing.  We have a nation of lovelorn singles poised and pleading for guidance and assistance.  The integrity of our sites can be improved, insofar as how we deliver on our core promise of putting people in front of people.  Observe the real world, bottle the best of what you see, improve on it.  The online personals world has improved on the real world in the past by offering better search (i.e. asking the important questions up front), offering multiple modes of convenient communication (i.e. email, IM, chat), and through profiling for compatible matches (i.e. asking more than just a few questions…).  Your comments please…