Dating apps want users looking for friends – 09/29/2024 – Tec

Internet dating giants and startups are betting on a different type of human connection in the search for revenue growth: friendship.

Bumble, Muzz and Match Group, which owns Tinder, are promoting their friend-finding and community features as an alternative model for digital dating, aiming to attract younger users who have been affected by so-called “dating app fatigue.” dating).

Bumble, the group that owns the app of the same name, Badoo and Fruitz, said it was optimistic about the “untapped potential” of the “friendship space”.

“The opportunity in this area is pretty limitless for us,” CEO Lidiane Jones said at an investor event this month.

In May, the group purchased community-building platform Geneva, which connects people based on common interests, building on the launch of friend-finding app BFF last year.

The surge in dating apps comes as some of the biggest online dating players have struggled with a slowdown in post-pandemic growth. Bumble lost a quarter of its market value after cutting its August revenue forecast.

Jones said Bumble would focus this holiday season on “scaling the growth of Geneva and BFF” to “diversify our business monetization model over time.”

Match’s newest app, Yuzu, launched in February, is also its first product to explicitly offer a social-only mode in addition to a dating function.

The app, which is designed exclusively for the Asian community, allows users to switch between “social,” “dating,” or “social and dating” modes—a feature the $9.6 billion company suggested it could expand for its portfolio of more than 40 platform brands of this type.

“This is a testing ground for us,” Match Chief Financial Officer Gary Swidler said at an investor conference this month. “You can draw the line, I guess, from things we’re testing at emerging brands, including Yuzu, and what we might be thinking about in the future for Tinder.”

Smaller rivals have also moved into the friendship market this year. “Muslim wedding” app Muzz, which has 1.5 million monthly active users, according to Sensor Tower, began offering Muzz Social, a friend-finding and social networking feature, in February.

New Muzz Social users are automatically added to groups based on their location and can also join networks based on hobbies or interests. “Automatically you have a bunch of communities you can turn to,” said founder and CEO Shahzad Younas.

Gay dating app Grindr, whose user numbers have continued to climb amid slowdowns at both Bumble and Tinder, has also explored adding social features for both friendship and professional networking in a bid to broaden its user base. .

Startups are also looking to tap into the so-called “loneliness economy” in the wake of the Covid-19 pandemic.

French startup Timeleft, which matches groups of six to go for a meal together, expanded to the US and UK this year and now operates in more than 200 cities.

Events and social connections company Pie secured $11.5 million in funding in September for an app designed to help users meet real-life locations as part of what founder Andy Dunn called “a mission to defeat isolation social”.

But analysts are skeptical that a shift to friendship will significantly increase revenue growth for existing online dating companies.

Tinder, Hinge, Grindr and Bumble all rely on “freemium” subscription models for most of their revenue, but analysts warn that the platforms may struggle to find users willing to pay to find friends — especially when common social networks like Facebook, are free.

“People are more willing to pay for romance than for friends,” said Ygal Arounian, an analyst at Citi.

Both Bumble and Muzz said they were considering paid partnerships and advertising to monetize their friend search products in addition to subscriptions.

But building a successful advertising business can require a lot of effort to recruit new users and drive daily product engagement. Bumble’s BFF has just 735,000 monthly active users, according to Sensor Tower, while its flagship product has more than 20 million.

Connecting payment with real-life encounters is another option. Timeleft users, for example, pay a fee or subscribe to reserve a space at one of the company’s weekly dinners. Timeleft keeps the entire fee, while users pay for their own meals at partner restaurants.

But even if they don’t make money in and of themselves, Bumble and Muzz are betting that friendship products will help keep users engaged with their brands even when they’re not actively seeking a partner, as well as offering a route to their business from most profitable dating.

Timeleft CEO Maxime Barbier said friendship products could be the future of online dating. “Relationships as they are today — swiping, texting and one-on-one first dates — are dying. People are so tired of it and see us as an alternative.”