In early December, Match Group, the owner of more than 40 dating apps and by far the market leader in the world of online dating, held its first investor day since going public in 2015. The major theme was that the next big shift in the business of romantic connections will be artificial intelligence — something the group is pushing hard. “AI is going to transform the dating experience.
It’s going to enable us to make all aspects of the online dating journey better,” proclaimed chief executive Bernard Kim. Behind those optimistic words, however, were some difficult realities. Although its brands now cater to tens of millions of users globally, Match’s market value — roughly $8bn — is just a fifth of what it was three years ago. Last month, Tinder, Match’s flagship brand and the app that arguably invented the modern dating industry, reported that paid user numbers had dropped on a year-on-year basis for the eighth consecutive quarter. Nor is it just Match: the world’s biggest online dating companies are in crisis, as their target customers, particularly women and younger users, increasingly look elsewhere, towards niche apps or real-life meets — or even opt out of romantic relationships altogether. In a recent survey by Forbes, 78 per cent of respondents reported feeling “emotionally, mentally or physically exhausted” by dating apps. The three largest dating brands globally — Tinder, Badoo (which is hugely popular outside the US) and Bumble — are all shedding users. And those that remain are increasingly unwilling to pay for access. Bumble, which owns both the eponymous app and Badoo, has seen its share price plummet nearly 90 per cent in the last five years. At Match, activist investors, including Elliott Management and Starboard Value, have started to make their presence felt. In a public letter sent in July, Starboard suggested that the group needed to trim its costs, attract new users and step up innovation