Swipe right - the new age dating gesture, has permeated the mobile world. Today, users spend almost 90 minutes1 of their day sifting through myriad potential partners, in search of the "perfect fit". This is greater than the average time spent by a user on traditional social networking sites, creating an alternate social network that is distinctly different from its older cousin.
Global Web Index, Q1 2015, Clickz.com
With a young, increasingly busy, always-mobile audience, the allure of the dating app business is becoming extremely addictive. Tinder is valued at $1 billion with 50 million monthly active users2 and in the east we have Momo with 78.1 million monthly active users, valued at $3 billion3. The intelligentsia might argue the emphasis on the valuations citing that the true value of a business lies in the unit economics i.e. when the user pay! But the trailblazer Tinder is at a serious advantage here as a quarter of its users are already paying for dating services.
With the lowering of stigma attached to online dating, technological advancements and a growing target demographic, the industry looks like it will continue to grow for years to come. The dating industry is worth $2.2 billion, but most apps aren't turning a profit. Many haven't even introduced a plan to monetize their services. But there are a few who are leading the way. Here is how they are successfully making money:
Like online dating sites, “Subscription” is a common monetization method among apps too, where users can purchase either memberships or premium features on a monthly, quarterly or yearly basis.
Following the suite of gaming apps, Freemium is a popular strategy among dating apps too, which let users access the basic version of the app for free and charge them for premium features.
Gifts & Tangible Services
Monetization can be realized by returning to the old fashioned way of gifting. Let users digitally gift their potential dates roses, chocolates, complimentary services like booking a cab, a table, or cover drinks etc.
For a comprehensive monetization strategy, especially for non-paying users, dating apps can look for in-app advertising too. But dating apps need a sophisticated advertising solution, which doesn’t disrupt users’ interactions and doesn’t infringe on their privacy. Native advertising, which respects the form and function of the app, is the best advertising solution available for dating apps.
In-Feed Ad in the chat list: When a user lands on the chat list, she can be shown a carousel unit promoting an app install, a Buy Now call-to-action for a product or a brand promoting its message.
Online to Offline: Integrating with offline services like booking a romantic movie for the date, calling an uberBlack or reserving a table at the restaurant of your choice!
In-Feed Ad in the content stream: If your app has a swipe interaction, a user can be shown an ad in one of the cards.
Gift Wall: An app wall promoting a variety of digital gifts like a book, a song on Spotify etc.