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Match Group's (MTCH) Tinder to Roll Out New In-App Currency

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Match Group (MTCH - Free Report) owned Tinder is working to encourage users to spend more time swiping, scrolling and eventually spending real money by introducing its in-app currency, per a Bloomberg report. The in-app coins will initially be available only in Australia and can be acquired as users remain active on the app and update their profiles.

The coins will be a way for Tinder to monetize non-subscribers by allowing them to make ad-hoc or one-time purchases. The currency can then be used on features like Super Likes or Boosts, which help improve the chances of finding a good match on the social platform.

Tinder, which was launched in 2012, is the world’s #1 downloaded as well as the top earning dating app. Tinder is the key catalyst behind the company’s year–over-year revenue growth. In 2020, revenues from Tinder direct rose 18% to $1.4 billion.

The dating platform might be testing the in-app currency as a way to bypass 30% commission charged by Alphabet’s (GOOGL - Free Report) Google and Apple (AAPL - Free Report) . Despite all efforts to avoid paying a 30% cut on in-app revenues generated on its app storefront, Tinder still allows users to pay for a premium subscription through Google Play Store and Apple App Store.

Match Group Inc. Price and Consensus

Match Group Rides on Tinder Popularity, Adds Features

In second-quarter 2021, direct revenues from Tinder jumped 26% year over year. The total number of payers for Tinder rose 17% year over year to 9.6 million, while Tinder RPP increased 8% year over year.

Tinder runs on a freemium model wherein users can gain additional features through subscription such as more granular filters, boosts and the ability to see people who have shown interest in your profile.

Moreover, gender diversification is an attraction for Tinder users, as the app includes more gender options like transgender. Per media reports, the gender options update was rolled out to make the service more inclusive.

The company has a presence in about 196 countries with reportedly over 50 million users (who spend an average of 90 minutes on the app and keep coming back at least 11 times a day).

Moreover, Match Group has introduced Tinder Lite, with an aim to expand international presence. The company also launched a credit card payment option on the Android version of Tinder. We believe that such initiatives can be strong growth drivers if Match Group decides to monetize the same ever.

This Zacks Rank #3 (Hold) company’s in-app currency move comes days after Twitter (TWTR - Free Report) announced that it will enable users to tip their favorite content creators with bitcoin besides third-party payment providers. Earlier this year, Twitter had launched its in-app payments feature Tip Jar in India. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

With more than 65 billion matches created worldwide, Tinder recently expanded its video in profile feature to more members around the world in additional countries across Europe, Asia, and Latin America. Videos within Tinder profile give members the ability to express themselves better, discover more about others and find the right match.

Also, Tinder now has a Hot Takes feature that enables members to chat with someone before their profiles match.

Besides, the addition of à la carte features and price optimization for the Hinge app, higher premium subscription purchases at Tinder and OkCupid as well as increases in live video streaming for PlentyOfFish app are expected to remain key catalysts in driving subscriber growth in the United States in the near term.

Further, the acquisitions of South Korea-based leading social discovery and video technology company, Hyperconnect, as well as non-dating apps like Ablo are expected to aid international revenues, thereby driving the top line in the upcoming quarters.

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