Hinge, Tinder want to help Gen Z find connections offline | Fast Company

If I could wave a magic wand, it would be to make guys more, you know, more charming and polite.

Who here is on a match group app? Raise your hand. Admit it. That's so... And do we have a lot of... Who here is single? Yeah. Same people who are on the apps.

Um, yeah, I mean this is a category that's been around for a long time. And some of our brands have enormous resonance with users. Brands like Hinge, for example, that are growing audience more than 10% year-over-year and revenue 15 to 20% year-over-year. But some of our other brands like Tinder had sort of lost their way and I tried to bring a new culture of innovation and regain product market fit especially with young users. We can talk about some of the ways that we did that but there's this... Gen Z has changed. Gen Z dates differently than my generation. Gen Z finds traditional one-on-one dating to be stressful. They say it's like a job interview. And so it was incumbent upon us to innovate and change to that reality and make sure that we had a social dating experience that was more casual, more fun, lower pressure. And we built out a product roadmap to do that and it's really working.

Yeah. Yeah. So the company history of Match Group was it was a category rollup. Barry Diller's IAC bought the category, you know, they bought Match.com in Dallas and they bought Pairs in Tokyo and they bought Azar in Seoul and Meetic in Paris and OkCupid and Plenty of Fish and Hinge in New York and then Tinder in LA. And so they rolled up the category, but they didn't really integrate many things. And so when I took over 18 months ago, I found a very siloed company where all these different apps had different technologies, different teams. There was very little communication or coordination, basically no integration. And my prior company, which I started, was Zillow Group. And at Zillow, we bought 17 companies and we turned the company into Zillow Group. We bought Trulia and here in New York StreetEasy and HotPads and RealEstate.com. And so I had experience running a multibrand company where certain brands are integrated in some ways and stay independent in other ways. And so what I've done over the last 18 months is try to bring that recipe that we followed at Zillow Group. So for example, we now do centralized performance marketing across all of our brands. We spend about $600 million a year advertising these 20 odd brands globally. And they used to be done completely independently. And now that's done centrally. And that's made a huge difference in terms of impact and ROI. Then from a technology standpoint about 20 of our apps now have an integrated backend. So when we push a new feature like a date ideas feature where when you're chatting with somebody it'll suggest where to go on a date. When we push a new feature like that to our integrated platform it'll end up on Chispa and BLK, OkCupid, Plenty of Fish, The League, you know, on dozens of our apps at the same time rather than having to rebuild that same feature 20 some times.

Yeah. Well, this was another surprise when I started. You know, most multibrand companies like LVMH or Intercontinental Hotels Group, they have a very thoughtful strategic portfolio sense or Procter and Gamble. I mean, Consumer Package Goods is great at this where they really think through why do we have certain brands, who do they serve? Match Group didn't really have that. Again, it was just kind of a category consolidator rollup. So, we spent months thinking through the brand strategy of why do we own all these brands? How should they be positioned? And there are a lot of different ways that you can position online dating brands. You could do it by age, for example, certain apps for certain age groups. You could do it by income. You could do it by geography. We decided to do it by user need. So, we categorized all of our apps across what we call fun, focus, and familiarity. So, Tinder, for example, serves the fun use case. This is the person that's looking for serendipity and, you know, is unsure what they're looking for. It could lead to a spouse. It could lead to a friend. It could lead to a short-term relationship. Focus is for people who know what they want. They're in it for a single purpose, which is to find the one. That tends to be Hinge, serves that use case. And then familiarity are people who are looking for their people. These are apps like The League, where you have to be accepted to get into The League. It's the app for highly ambitious people. BLK, which is for black daters. Sniffies is for gay male daters. Her is for sapphic or lesbian daters. So familiarity are the apps that serve certain communities. So just creating that construct of those three categories has been really helpful for us internally.

Yeah, we love Sniffies. I mean Sniffies is the number two player in the gay space. It's growing incredibly quickly. They've got incredible brand love. If you ask Gay Men, they adore Sniffies and adore the brand and they've got just extraordinary product market fit and a very talented founder and we think that we can take their product to the next level. So we don't own all of it yet. We acquired half the company with the right to buy the rest. We're working very closely with them to improve their trust and safety features and we are just really optimistic and excited about Sniffies. It's a huge segment. Obviously, the gay male segment is a very important category in online dating. We had a subscale brand called Archer that was incubated internally, and I made the decision to shut Archer down and instead bet on Sniffies. And so far, it's been looking like an excellent bet.

Yeah, so this was a big surprise for me. I mean, I would have guessed 15 years into Tinder and 10 years into Hinge and 25 years into Match that we would have kind of perfected the recommendation algorithms and yet there was so much improvement and just in the last year partly due to AI but partly due to the fact that we upleveled the talent at the company we've made significant improvements to our recommendation algorithm and there's still so much more to do. So the other big unlock for us was creating an outcomes driven KPI. So the recommendation algorithms previously were partly focused on user outcomes but partly focused on monetization and making sure that we would retain users and making sure that we would make money. And we really shifted the whole company and all of our outputs to focus on what we call sparks. And a spark is a chat that goes six ways or more. So the way dating apps work are you say, 'I like this person.' They say they like you, and now you're in a what we call a match. And now you're in a chat interface that looks kind of like iMessage where you're chatting back and forth or WhatsApp. And we used AI to interpret millions and millions of these chats and figured out that once a chat gets to six or more times, that's when you start flirting. That's when the butterflies happen. It's like, 'Hey, hey, what's up? Nice to meet you. Thanks a lot. Where are you from? I'm from here.' Okay, that's six. Now, here comes the good stuff. Now you actually start to say, do you want to go out? What are your interests? What are you looking for in a relationship? So, that's a spark for us. And the whole company is focused on generating sparks. So for the recommendation algorithm for example which is what you asked about we can now tune the recs algo to say who should we show to Spencer that is most likely to result in him getting a spark rather than who do we show to Spencer to retain him or to make more money or to achieve some other outcome. So just gearing the whole company towards that user-driven outcome has made a huge difference on all of our metrics.

Anything but hey. In fact, we have a whole TV campaign in Europe that is about like the just the hey, you know, it mocks guys for how terrible and uncreative they are. Just hey, hey, hey, hey. Yeah. I mean, if I could wave a magic wand, it would be to make guys more, you know, more charming and polite. I think that would have a real impact on our business and our society. So you know we do what we can and AI can help. I mean we have an AI-driven feature called 'Are You Sure' which reads the message before you send it and if we interpret it as potentially sexually explicit or inappropriate or just you know not creative. We'll say are you sure you really want to send this? It might be kind of received by the recipient sort of meh or worse. And so we built that feature really as a trust and safety feature to try to minimize or ideally get rid of inappropriate messages but we can now improve upon that with AI to make it more about wholesale coaching which can try to kill the hey and replace it with something better. A friend of mine always messages 'there she is' to everyone.

There she is.

Yeah, it's... I don't know. It could be a little on the nose. I don't know. I have to think about that.

Yeah, they do. And this is another thing that I changed. So, Tinder is the number one dating app in 166 countries. And prior to my arrival 18 months ago, there was no customization of Tinder except with language. So, the feature set, the pricing, the recommendation algorithm in Japan and India and the United States and Norway were all exactly the same. We now have a couple of teams in our Korea office that do localization and internationalization of Tinder specific to different countries. So for example in India where dating is very different. We now have a different set of features for Indian daters on Tinder or in Japan. For example we are testing now banned screenshots. So if you try to take a screenshot of Tinder in Japan it won't let you. It'll say like, you know, an issue in Japan because in Japan there's a real stigma like you don't want your parents might not want you on dating apps or you might not want your friends to know that you're on dating apps. So women especially are nervous about people taking screenshots of them and then their co-workers finding out that they're on dating apps. So if screenshots are blocked, we think it'll improve our product market fit in Japan. That's not something that in the US people are as concerned about. We'll see. We'll do some research. But so for the first time ever, we're now actually building custom features for different countries, which I think has a ton of potential. Asia in particular has just the most differences in dating. Pairs for example, which is our the number one dating app in Japan, which we own. You know, 10% of marriages in Japan come from Pairs. It's the Hinge of Japan essentially. And Hinge is not in Japan. And Pairs for example you enter your salary and your blood type and your driver's license, your national ID card, you're verified so it's very different than in the United States. I mean can you imagine if you had your salary maybe I don't know maybe people would like that I don't know but it's a little obnoxious but in Japan it's expected so there are definitely dating differences.

It's very hard to create an appropriate gender balance on dating apps because there are so many men that are seeking women and fewer women seeking men online and so you're allowed to have different pricing in India. You can't in the United States. You can't for example like in the US you can't charge more for Tinder Gold for men than for women it's against law it's clear gender discrimination but you can do that in India you can do that in most of the world so now we're starting to change our pricing in certain countries like India where we have more pricing flexibility to improve gender balance. And another dating difference in India is that we have a feature on Tinder called Passport. In fact, I was just showing it to you backstage where you can select a different city and start seeing people in a different city. So a very common behavior in India including among women is they if they live in a smaller city they'll passport to a major city because they want to move to Delhi or Mumbai or some major city. And so it might make sense in India to break Passport out as a separate feature sold separately right now it's bundled with our other products for example so Passport has... you don't really do that in the United States as much you kind of want to date in your city so Passport is voyeuristic in the United States but it has a high utility in India.

So, we think freemium is very important in the category. In other words, it's very important to have a good free experience because dating apps are a network effect business. We think of our apps like a bar. And you need a certain number of people in the bar for there to be a good vibe and good outcomes and lots of sparks flying. And so 70 to 80% of our users pay nothing. And that's great. We want a high percentage of users that are there not paying because we want a lot of people at the party. Hinge and Tinder have slightly different monetization strategies and slightly different features. And to be honest, I am not 100% sure that we've got it all right. Like I mean a lot of these monetization models were developed 15 years ago and need to be revisited. So we are looking at that. We're trying to you know other than this principle of making sure that we have a great free experience. I think a lot of things are on the table. Hinge right now is testing a new tier, a new priced product entirely. It's geared towards women because women have very different needs than men and sorry you know on dating apps in particular most of our paid products give you more exposure like I will pay to put me in front of more people. That's basically the way most dating apps work. But women receive a lot of inbound interest and so they need a different set of features. They primarily need the ability to triage the inbound interest that comes to them and none of our paid products do that. So, we're experimenting with a paid product on Hinge that would do that, which would be geared towards people who receive a lot of inbound interest, primarily women, but also some men.

No, it's so Hinge's payer count is growing significantly. Tinder's has been declining. Our payer count basically goes in the direction of our monthly active users. So when I came into the company 18 months ago, monthly active users on Tinder were down 10 to 15% year-over-year and now monthly active users are down kind of mid single digits. So I basically halved the rate of decline and payers kind of go along with our traffic overall. What we've said to investors is that by the end of next year we're going to get MAU to flat and we're also going to get payers to flat. So we think of this turnaround as three stages. It's reset, revitalize, and then resurgence. We're through the reset stage. The reset stage was the like, okay, we got to get the right people in place. We got to motivate them. We got to, you know, kind of like make amends, clear the decks. That was reset. We're through that. Now we're in this revitalized stage, you know, maybe like a third of the way through which is improve the product, improve user outcomes, come up with the right KPI like Sparks, improve recommendation algorithms, revisit the monetization model. That's the revitalized stage and then resurgence, you know, hopefully next year when things really start to click.

Yeah, Gen Z is different. Gen Z is 18 to 28. They have a lot of scar tissue from the pandemic. They, and obviously, I'm generalizing here, but they lost a couple really important years, late high school, early college. You know, imagine if you missed your high school graduation because of COVID and your first two years of college were online or you entered, you know, those first couple years when you know, I was in college and making mistakes and then your first couple years as a young person living in New York and staying out too late and like doing the things that people 18 to 24 are supposed to do, they didn't do it. And so now they have a hard time making small talk. They have a hard time asking one another out. And the dating apps hadn't responded to that new normal. And so what we did was we instead of just kind of burying our head in the sand and hoping that it would go away, we decided to actually do something about it. And so we built a roadmap that caters to that user type. So for example, Double Date has been hugely successful at Tinder. So Double Date is you and your friend join up on Tinder and now you're a pairs of two and you're looking at pairs of two and you're swiping through twosomes and then you're now in a four-way chat and then when you want to get together to go on a date, it doesn't feel like a stressful one-on-one date like a job interview. It feels like you and your friend hang out with these two other people. And if it goes well, great. And if it doesn't go well, at least you got to hang out with your friend and you can laugh about it. So Double Date has been wildly successful. About a quarter of our Gen Z users in the US use it. About half of our Gen Z users in many European countries use Double Date. We then took Double Date a step further and are testing a Groups feature now which is three to 15 people where groups of people your roommates your friends from college your lacrosse team your fraternity brothers whatever they create a group and then you're swiping through groups of people and you post what you want to do like this group of people who's going to go out you know whatever play soccer at the park on Saturday at 2 p.m. And then these other groups of people are like swiping and then you can get together in person. And then by far the most impactful product that addresses this changing Gen Z need has been events. So Tinder has leaned in very heavily to in real life IRL events. Right now we're in about 25 cities. I was just looking at the New York events on Tinder. The second tab of Tinder, like tab one is the traditional Tinder where you're looking at profiles. Tab two is events and it's fun things to do over the next week or two and you tap on the mahjong class or the run club or the karaoke night or the Highline walk with strangers and you can see who's going. So the Highline walk which I think is tonight I was just looking at has a couple hundred people and you can see all their photos and profiles. You can tap and you can see their profiles and then you can after the event messaging opens up so you can message them if you were too afraid to get her number because Gen Z doesn't know how to ask anybody out like you can now do that through the app. So basically we built a roadmap to help Gen Z help themselves.