Recent research from Market Data Enterprises found that the matchmaking industry was worth an estimated $917 million in 2004, growing nearly 25 percent from 2003 and 9.3 percent every year thereafter to an eventual $1.45 billion industry, if traditional and mobile dating services are also factored in.
Virtual matchmaking has frequently been referred to as the Internet's next killer app, and according to Jupiter Research, more than 18 million people visited online personal websites in June 2002, a significant jump from 14.8 million the prior year. Jupiter analysts also estimate that about two out of every five U.S. singles online have visited a personals site, with nearly one in four having posted a profile.
Market leader Match.com has 600,000 customers paying $25 a month, and uDate.com, which also operates Kiss.com, had $1.5 million in revenue in June 2001. In May 2001 alone, the company made $4 million and had four straight profitable quarters.
By incorporating the highly profitable aspects of online matchmaking, many adult companies are quickly catching on to the benefits of combining the first and second biggest sectors of monetized Internet content. Customer retention for adult matchmaking sites is reportedly much longer because members tend to be people who aren't looking for a long-term relationship, just something on the side, and since most of the content is supplied by users, webmasters don't have to pay for camera crews or talent.
Andrew Conru is CEO and founder of FriendFinder.com, which started in 1996 when he studied computer science at Stanford University. With more than 25 million active members and 75,000 newcomers registering daily, Conru said the FriendFinder network is among the top five online dating sites.
Seeing a growing demand for more adult content, branching out into the adult sphere in late 1996 was a natural progression for the FriendFinder network. Conru eventually introduced an adult component, AdultFriendFinder.com, a more sexually oriented and explicit dating option and counterpart to the tamer FriendFinder.com, which over time evolved as a niche market for people with alternative lifestyles such as cross dressing, candle wax, chastity belts, fisting and various other fetishes.
And just as AdultFriendFinder grew out of a market-driven response to FriendFinder content, Alt.com also evolved as a niche market for alternative lifestyles, such as BDSM.
"Some people using FriendFinder.com were a little risque in what they uploaded," Conru said. "I could either delete or hide them, or spin out a completely new site for adult-oriented people. If the market was looking for this type of activity, we wanted to create a service that provided exactly that. We didn't want to censor our members. On the adult side, there are fewer restrictions when it comes to what content you can upload."
According to Conru, the signup process is streamlined. People register on a questionnaire of around 15 to 25 questions and then members can search the whole database based on compatibility, which is mapped into 60 personality traits if users use a larger questionnaire form.
In Part 2 we'll examine issues of compatibility, privacy, and safety...
