IAC/InteractiveCorp owned popular free mobile-dating app Tinder released its new premium service, Tinder Plus, in a bid to generate revenues. The price for Tinder Plus will vary based on a user’s location and age. The premium service favors the young.
The new paid service costs more for subscribers above 30 years of age. Users who are below 30 in the developed nations including U.S. will have to pay $9.99 per month for the service, while their older counterparts must fork out double the amount, that is, $19.99 per month. In developing nations, the service will be priced at $2.99 per month.
Tinder Plus is a new monthly subscription version of the app that offers premium features to users and is the first step toward monetization for the dating company, which is majority-owned by IAC.
Tinder Plus comes with new features for users. There is an option to "rewind" or unswipe someone, which enables users to go back to the last person they swiped for a second look. The app enables users to "swipe right" on people they find attractive or "swipe left" to reject someone. It also offers another feature Passport, which allows users to match with people around the country and around the world instead of just one geographic location.
Tinder Plus also offers the option of removing ads from Tinder. However, ads don't yet exist in the app, but are going to hit the service this month. Therefore, if users don't want branding to get in the way while they search for the right suitors, they will have to pay to get rid of them.
As per Tinder spokesperson Rosette Pambakian, the service is used in 140 countries. One million new users join the site every week, and around 22 million matches are made each day. The company, however, does not reveal the actual numbers. But after the U.S., Tinder’s biggest markets are Brazil, the U.K., France, Canada and Australia.
The new paid service has disappointed users, and they have used Twitter (TWTR - Free Report) to express their annoyance. Tinder has been testing pricing in different markets for the past few months. Tinder justified the pricing structure by stating that young people are more budget constrained and hence its offering lowers prices for them. Also, older users, who are generally less active, should pay a higher amount for extra dating tools.
To add to users’ woes, Tinder has also introduced a limit on how many right swipes or "likes" are allowed within a certain time frame. Once the limit is exceeded, users will have to wait 12 hours to swipe again.
Tinder is a very popular dating site and the new service is intended to generate revenues for the company. However, the latest update is discouraging for users who decide not to pay for subscription privileges.
But then again, the younger lot is generally more into using dating apps and are generally more budget constrained. They will not actually mind the ads so much if they don’t have to pay. This will create ad revenues for the company which will directly benefit IAC as it is the majority stakeholder in Tinder.
So we need to wait and see how it works out.
IAC/InteractiveCorp carries a Zacks Rank #3 (Hold). Other stocks that are performing well include Autobytel Inc. and PetMed Express, Inc. . Both sport a Zacks Rank #1 (Strong Buy).