Tuesday, November 13, 2012

Online dating business problems

Pay dating business model

In an editorial post titled "Why you should never pay for online dating", a founder of free dating site OkCupid criticized pay-dating as exploiting users and as "fundamentally broken", and noting that "pay sites have a unique [financial] incentive to profit from their customers' disappointment". The post analyzed the business model used for pay dating and noted that it gave rise to "strange incentives [because] the only way they don't make money is to show subscribers to other subscribers." (emphasis in original)
Instead it creates an incentive to show profiles of lapsed and non-paying members (described as "ghosts" in the analysis) in the hope that site visitors will wish to contact these profiles and will subscribe to do so, or that once contacted by new or existing users some of these "ghosts" will wish to respond and will re-subscribe in order to do so. This causes a low response rate, which in turn encourages respondents to become desperate and formulaic, reducing their chances of meeting people.

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