Tinder is preparing to launch a new “high-end” membership later this fall as well as a product refresh aimed at better catering to Gen Z users, according to parent company Match Group, as part of its Q2 2023 earnings release on Tuesday.
The new Tinder membership was confirmed earlier this year by Tinder CPO Mark Van Ryswyk, who had then dubbed the $500-per-month offering “Tinder Vault” in an interview with Fast Company. As inspiration for the new product, Van Ryswyk cited learnings from Match Group’s July 2022 acquisition of another high-end dating app, The League, which could cost users up to $1,000 per week.
The exec said that indicated there’s a market for daters who are willing to pay for quality matches and experiences that lead them into new relationships. But he indicated the product would rely on technology, not human matchmakers.
Match Group acquires members-only dating app The League for ~$30M
The company shared today it expects the initial pricing for the new membership to be “substantially higher” than Tinder’s current offerings, given the extra benefits it entails. In addition, the product will have limited availability making it a more exclusive offering. Further details weren’t available in the company’s shareholder letter but may come up during the Q&A in tomorrow’s call with investors.
The company also noted Tinder would roll out an “important” product refresh in the second half of the year with a focus on better catering to its core Gen Z audience. This refresh will include features like prompts, quizzes and conversation starters, as well as leverage AI to surface the right content to the right people.
“While the core Swipe feature will remain central to the Tinder experience, the changes are meant to make the app more dynamic and engaging,” Tinder’s shareholder letter reads. “We expect these features to begin rolling out in select markets later this month.”
In the quarter, Match Group generated revenue of $830 million, up 4% year-over-year, and forecast next quarter’s revenue of $875-885 million, citing Tinder’s return to growth. The company had been expected to report $811.4 million in revenue, according to FactSet.
Tinder was responsible for $475 million in direct revenue in Q2, up 6% year-over-year, which the company attributed to its strategic decision to focus the first half of the year on optimizations and a new marketing campaign, “It Starts with a Swipe,” that translated into “revenue acceleration and improved user growth,” it said.
The campaign helped in terms of new user signups and in encouraging lapsed users, including women, to rejoin.
The company also referenced new U.S. pricing optimizations introduced at the end of Q1 and uplift from popular weekly subscription packages as aiding in Tinder’s growth.
The downside of the pricing optimizations at Tinder was a decline in payers, which dropped 4% year-over-year to 10.5 million, as conversions decreased. Match Group payers overall declined 5% year-over-year to 15.6 million.
Among other earnings highlights, Hinge was cited as one of the top three dating apps by downloads in 14 markets globally. The app also pulled in $90 million in revenue in the quarter, up 35% year-over-year, with 1.2 million payers.
The company also reported operating income of $215 million, representing an operating margin of 26%. Adjusted operating income was $301 million, representing a margin of 36%.
Match Group’s earnings call will be hosted on Wednesday, 8:30 AM ET.
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