How has online dating websites changed in the past decade? Are niche dating sites the future? Marina Glogovac, CEO of Lavalife, has all the answers in the fourth part of DigitalJournal.com’s Celebrity Guest Writer series.
This is the fourth article in a series of Celebrity Guest Writers offering their insight into issues close to their experiences. Check out tomorrow’s DigitalJournal.com to see what other topics will be investigated and discussed by some of the world’s leading thinkers and leaders.
See part one, by Lieutenant Governor David Onley, at this link
See part two, by former police officer Jack Cole, at this link .
See part three, by online video producer Miles Beckett, here
by Marina Glogovac
Online dating today is definitely a generally accepted way to meet other people. Like all other ways, it has its own unique set of pluses and minuses. General demographic trends of the last decade and the emergence of empowered, liberated, economically independent women, combined with the growth in Internet access and usage, have all contributed to its coming into the mainstream.
As an industry, online dating has gone through years of exponential growth and then maturation. It is still an approximately $700-million dollar industry. Online dating is one of the very few things on the Web consumers are willing to pay for, beside the travel and entertainment categories which continue to grow (games, downloads…). That speaks to the value consumers place on the service.
Typical for other new or emerging industries, many players who were there in the beginning benefited from the market expansion and enthusiasm of early adopters (to paraphrase a famous Warren Buffett observation). As the expansion slowed down to single-digit annual growth, companies started to put more effort into differentiating from each other, through business models, customer segmentation, brand positioning — in short, by trying to articulate more clearly their unique value proposition to the customer.
At the same time, the introduction of new, more streamlined programming languages lowered the barrier to entry considerably and the market filled with numerous start-ups who all faced a daunting task of building a critical mass of customers who will stick around long enough and be happy with the results to make their efforts viable in the long term.
Lowering the technological barrier to entry enabled the introduction of free, ad revenue-supported online dating services — another predictable trend that played out strongly in the media industry, for example. This was also facilitated by the growth of PPC and other performance online advertising.
The introduction of the free model in online dating was also at least partially influenced by the rise of social networking phenomenon, where enormous user popularity has yet to be translated into a viable and truly scalable revenue model.
The free sites today co-exist with paid sites just like they have been in media. But there is a well-noted challenge with ad-supported sites in that there is a three-way dissonance between huge traffic, cheap ad inventory that is ultimately insufficient to support growth, and the difficulty of obtaining high CMP rates from top brand advertisers, largely because of the very free nature of the site. For the most part, free sites have introduced more variety and consumer choice in the market place.
Another online dating trend that followed other communication industries is “nichifying” – usually after everyone becomes very similar and the competitive advantages are harder to articulate on a product level, we see niche sites aiming to aggregate people around common values, lifestyles, religion, race or interests. Consumers converging around what they have in common, and wanting to “belong” to communities of like-minded people is in human nature. This trend will continue, and it’s made more appealing from a business point of view because of the unique presence of the Web’s long tail.
Today, Lavalife is a well-established business with products and services on the web, mobile, VoIP and in the media space, serving millions of customers and having established itself as one of the most recognizable brands in Canada. We were the first successful large commercial application of VoIP technology in North America for which we received a prestigious technology award (2006 CIPA Silver Award of Excellence in Innovation).
This brings me to another trend — VoIP has enabled applications that that have added more life-like dimensionality and texture to online dating as well as the appearance of voice-only communities.
Finally, I should mention the migration of all things, including online dating, to the mobile platform. Given the ubiquity, pervasiveness and technological possibilities of mobile devices, this is the next frontier.
The last two trends point to a rapid formation of the much anticipated consumer-centric universe of converged communication platforms where brands, once again, are poised to be valuable assets of trust, and where coherence of product strategy and marketing communication across different platforms will present at once a challenge and a huge opportunity for marketers.
Marina Glogovac is the Chief Executive Officer at Lavalife. Prior to joining Lavalife, she oversaw the development of many successfully media brands, including serving as Vice President and Group Publisher at St. Joseph Media and Key Media in Toronto. She most recently worked as an associate of Cue Ball, a U.S.-based management consultancy in the media and entertainment industries. Marina has served on a number of leading media industry boards and as a featured speaker at media industry and cultural conferences.
