Lonely log on to find love in a cold climate
The worse the economic outlook, the more people are turning to online dating services in the quest for a soul mate to share the bad times.
Sunday 14 December 2008
There's nothing, so it seems, like a global financial disaster for bringing people together. Membership is booming at internet dating sites as the credit crunch and impending recession bring a rush to find a partner to share the pain.
Companies such as Match.com and EasyDate, which owns the SpeedDater, DatetheUK and BeNaughty brands, say they have seen some of their best days trading ever since the collapse of Lehman Brothers led to global financial turmoil in September.
Match says it has experienced its 10 biggest days in terms of visitors in the past year, and three of those have been in the past few months. "There is clearly an appetite in this financial climate," says Jason Stockwood, managing director of Match's British and European sites, which include own-label services for MSN and Yahoo!. "It is important in these difficult times for people to be sharing the burden with someone."
Match, which is owned by IAC, the US internet behemoth that is also behind search engine Ask.com, says part of its recent success in the UK has been down to doubling investment in TV and online advertising. Match hopes to capitalise on its larger scale as it attempts to win market share from rival DatingDirect. Other sites are also registering an uptick in daters.
Sean Wood, marketing manager of the smaller British competitor EasyDate, which is owned by Scottish entrepreneur Bill Dobbie and his Ukrainian business partner Max Polyakov, says its sites have seen growth 10 per cent above average since the beginning of September.
"There has been quite a big spike in traffic and the number of people registering," he explains. "Our view is that it seems to be a cheaper alternative to going out to meet people. Monthly membership of an online dating site is about £20 and you could spend that in an hour in a club."
Katie Mowe is managing director of DatingDirect, one of the UK's biggest sites and owned by the French-listed dating specialist Meetic, which operates services in Europe, Latin America and China. She says its sites hit five million registered users five weeks ago at the height of concerns for the UK economy. There was a 28 per cent increase in UK subscribers between January and the end of September, according to the company's latest stock market filing.
Ms Mowe says: "We are growing but there is also increasing acceptability of online dating, so it is hard to tell whether it is the credit crunch or just a rise in dating." However, she adds that Friday and Saturday night registrations have increased over the past few months, suggesting that people are staying in and looking for dates online rather than heading out to pubs and clubs.
The latest figures from market research service Nielsen Online indicate an 18 per cent rise in unique users visiting internet dating sites between September and October, although that follows a 14 per cent decline in the previous month. Over the past year, the number of visitors to these sites has risen 20 per cent, on top of a 9 per cent increase the year before.
Mr Stockwood at Match says there is now greater general acceptance of online dating. It has lost some of its stigma and is becoming a viable alternative to going out to meet people.
He adds: "Everyone knows somebody who is online dating now. That's changed over the last two years. The biggest test of the business is whether people meet someone – and people have been successful. It works and that is a huge draw for others."
That theory will be tested to the full as the dating sites head for their busiest time of the year, the period between Christmas Day and New Year, when many singletons are set on finding their dream partner.
The month-on-month rise in visitors to dating sites soars to an average 14 per cent between December and January, compared to 2 per cent over the year, according to data from Nielsen Online.
Partly this is because the number of visitors drops off in November and December as singles concentrate on going out to pre-Christmas events and parties, and also because Christmas and New Year is sadly the biggest time for couples to break up.
Mr Wood at EasyDate adds that dating activity is also boosted by interaction with friends and family over the holiday period. "There is a phenomenon at Christmas and New Year when there is a lot of social and family events and people on their own are exposed much more to other people in loving relationships – and that spurs them on to do something about getting into a relationship."
Revenues at EasyDate, which was set up three years ago, have at least doubled every year since it launched, while profits have tripled. Mr Wood says the momentum behind that growth will not fade away despite the squeeze on people's disposable income wrought by the credit crunch. "I think we will see the same kind of spike [in new members] we have seen before. There certainly won't be a drop and there is no sign of any downturn in growth," he says.
According to Jupiter Research, the online research group, the industry will grow from 2.8 million paid users in Europe in 2006 to about six million by 2011. Over that period, revenues from British dating sites, which come overwhelmingly from subscriptions, will increase from€85 million last year to €147.3 million. The industry stands out from many rival internet services in that members are prepared to pay a subscription rather than expecting to date for free.
However, dating sites face increasing competition from social networking sites such as Facebook and MySpace, which put like-minded people in touch with one another at no charge. Those sites saw their share of internet visitors rise to 8.78 per cent last month from only 8 per cent at the beginning of the year, while dating websites attract less than 1 per cent of internet visitors in the UK.
The increase in the online dating market has also been accompanied by a dramatic rise in the number of sites catering to various groups and proclivities, ranging from bibliophiles to tall people, cat lovers, rubber fetishists and even those who are already married. Gaydar, the service for unattached gays, is one of the UK's most popular dating sites.
There are now an estimated 1,300 sites sought out by singletons who want a service that will help them save time by finding exactly what they are looking for.
Many of these smaller services are growing more quickly and are able to charge more than their bigger, generalist rivals. Guardian Media Group's Soulmates site, for example, has enjoyed growth of more than 60 per cent a year over the past four years – an increase undented by the UK's economic problems.
Some industry insiders say smaller sites struggle to make money because the cost of acquiring new customers is relatively high compared to the number of members they can attract. Industry expert Mark Brooks says only four or five internet dating sites worldwide make serious money.
In such a competitive environment, the bigger firms are not really able to put up subscription fees and so are constantly launching new services to try and help members refine their list of potential suitors, hopefully raising the income per subscriber in the process.
The latest trend is in personality tests, with DatingDirect launching its Affinity service last month. Match is set to unveil its own personality test, Match Insights, early next year.
Mr Brooks believes that the growth in online dating is likely to slow in the UK next year as the market begins to reach maturity.
With that in mind, it is more than possible that EasyDate's acquisition of SpeedDater, which happened in March, will be followed by further consolidation as the major players attempt to build scale.
Match has shown itself to be very acquisitive and Mr Stockwood admits he has cash to spend if the right deal comes his way. How apt that the future for online dating could lie in some happy match making.
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