THE

ONLINE DATING MARKET IN THE UK 2013-2014

Current trends and developments in the online dating industry: users – service providers – revenues – technologies

THE ONLINE DATING MARKET IN THE UK 2013–2014

2

Online Dating in the UK 2014: increase in the number of users, decrease in revenue After a decade (2002-2012) of continuous upward development in the UK online dating market, two opposing trends are currently causing unrest for some in the industry for 2013/2014: On one side, new user groups have started using online dating, and, on the other, there has been a decrease in revenue. In our third market analysis publication, you will find the most important and current trends regarding online dating in the UK.

1. SINGLES ON THE INTERNET Of the approximately 63.8 million people living in the UK, about 17.1 million held the status of “single” at one time or another in 2013. However, it is difficult to clearly define the term “single”. For example, is a 72-year-old still single? Of these singles, approximately 16 million are regularly using the Internet and are the main target group for the industry. It is estimated once again that around 25% of this group (particularly men) are actually in a relationship.

2. ONLINE DATING LANDSCAPE Essentially, online dating service providers can be categorized into five groups:

»»Social Dating

Predominately “flirt” services for mobile devices targeting the younger demographic, lower price segment (freemium model) Top-3: Badoo, Skout, Tinder

Keyword “Mobile Dating“ The difference between online dating und mobile dating has become non-existent in our eyes. The established online dating players of course now offer mobile version of their sites and an additional mobile app. And most of the former “mobile only” dating service providers now have added a website, because the customer now expects that the service provider of their choice is available to them at all times and across all platforms. Additionally, a separate calculation of revenue via mobile devices makes little sense since a majority of users jump back and forth between “online” and “mobile” from first use to purchase: Over 50% of all logins are through mobile devices today, but over 75% of all revenue continues to be collected using the PC. Therefore, we have grouped both varieties under the term “online dating”.

»»Online Personals

Mainstream services for searching through personals by oneself, most often includes a chat feature, middle price segment Top-3: Match.com, PoF.com, Zoosk

»»Matchmaking

Matching of couples based on a psychological matching process, higher price segment Top-3: eHarmony.com, EliteSingles.co.uk, MatchAffinity.com

»»Adult-Dating

Dating websites for erotic contact (hook-ups, infidelity, swinger, fetish) Top-3: AshleyMadison.com, AdultFriendFinder.com, BeNaughty.com

»»Niche Dating

Specialized for target audiences like seniors, single parents, plus-sized, alternative lifestyles...

There are over 1,500 of these websites in the UK, however, most are small online personals sites. In any case, only about 25 service providers have over 100,000 active monthly members. Foreign, in particular American, players currently dominate the market. Among the domestic dating companies which stand out are Cupid PLC, Badoo und WhiteLabelDating.

163,6

113,0

54,4

113,0

138,1

82,6

THE ONLINE DATING MARKET IN THE UK 2013–2014

3

44,8

20,6

21,5

98,3 88,7

21,5

13,8 79,7

9,7 3,5 70,2

79,7

61,0

61,0

54,4

3. ONLINE DATING USER: AN UPWARD CURVE

54,4

45,3

9,7 3,5

45,3

33,1

9,7

3,5

13,8

4,6

20,6

2,60 6,2

2,50 7,2

2,30 7,1

7,0

6,9

7,3

6,9

1,60

7,0

6,9

6,9

9,7

1,50

3,5

0,65

13,8

7,1

7,2

6,2

4,6

7,0

7,3

6,9

6,9

Revenue per inhabitant in GBP

6,2

7,2

7,1

7,0

6,9

202,8 188,9 179,5

7,3

6,9

0,55

202,8

188,9

13,8

4,6

185,8

21,5 188,9

179,5

In addition, there are a further 2.9 million monthly users in the “Adult Dating” category as well as about 400,000 users of gay dating services. 113,0

163,6

82,6

1,60

82,6 138,1

202,8

113,0

44,8

0,25

27,42004 % 2005 2006 2007 2008 2009 2010 2011 2003

CH NO UK DK SE DE NL AT FR IT ES PT

44,8

113,0

3,60

82,6

4. REVENUE DEVELOPMENT: FIGURES DECREASING SLIGHTLY

1,50163,6

21,5

138,1

21,5

29,3%

3,50 2,8

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

179,5

113,0

1,60

82,6 0,65 2003 2004 2005 10,82006 % 2007 20080,552009 2010 2011

163,6

138,1

188,9

138,1

44,8

179,5

202,8

163,6

0,25

187,5

7,3

20,6 2005 2006 2007 2008 2009 2010 2011 2003 2004

20,6

1,85

1,60

7,1

2003 2004 2005 2006 2007 2008 2009 2010 2011

33,1

8,1

7,7

45,3 7,2

6,2 33,1

4,6

The Internet dating boom in the UK started in the year 2000. At that time, there were around 100,000 profiles of singles on the 2,90 2,90 2,60 2,50 net. Currently, there are2003around 7.12007 million online 2,30 2004 2005 2006 2008 2009singles 2010 2011 2012 2013 every month looking for a partner, considerably more than in 2011 (6.3 2003 2004 2005 2006 2007 2008 2009 2010 2011 1,85 million). The fresh influx of users is generated mainly by the new generation of social dating services like Tinder and Badoo, which have managed to tap into younger CH the NO UK DK SE DEtarget NL ATaudience FR IT ES of PT the 18+ dater and singles with an immigrant background. 2,90

61,0

54,4

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

70,2 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

2,90

33,1

44,8

82,6

79,7 70,2

45,3

44,8

2,50

2,10

2,00

1,90

21,5

% 2011 2003 2004 2005 2006 2007 2008 13,4 2009 2010 Despite the significant increase in the number of users, revenue for the industry, which is 19,1% currently at 158.7 million GBP for 2013, is less than the level of 2011 (168.5 million GBP). 3,60

3,50

2,8

2,50

2,90

2,90

This can be mostly attributed to: 2,60

2,50

2,10

2,00

1,90

0,85

0,80

2,30

0,45 1,85

3,60

»»The typical users of “online personals” are moving over to the cheaper social 1,60

1,60

1,50

3,50

2,8

Mitglieder Umsatz 2011

dating players.

Match.com

0,65

> 50 Mio.

2,50

2,10

2,00

0,85

0,80

CH UK SE DE NL AT FR ES

IT

PT

0,45

1,90

0,55

~300 Mio. Euro

CH UK SE DE NL AT FR ES

»»The monetization of members is becoming increas-

IT

PT

Market Shares (users) Deutsche Ausländische CH NOtoUKimproved DK SE> 130 DE consumer NL AT ~100 FR ITMio. ESEuro PT Badoo Mio. ingly difficult due protection Portale Portale 20 % regulations and more mature customers. 80 % 20 % 10,8 % Meetic > 40 Mio. 178 Mio. Euro Deutsche Ausländische ES IT PT Portale »»The increasinglyParship critical reporting on “grey areas”CH in UK SE DE NL AT FR Portale 20 % > 10 Mio. ~40 Mio. Euro 27,4 80 %% 20 % online dating (e.g. actors, romance scams, subscription 80 % cases). 29,3% Deutsche Ausländische Mitglieder Umsatz 2011 The overall situation should not obscure the fact that the UK still Portale Portale 80 % 20 % 13,4 % plays in the first division, and, moreover, certain providers80 have % 20 % still been able to achieve amazingly high revenue growth over Match.com > 5019,1 Mio.% ~300 Mio. Euro the past two years. Mitglieder Umsatz 2011 0,25

0,85

0,80

0,45

10,8

10,2

8,5

7,3

5,6

1,8 7

1,1 5,7 6,3

2,6

10,4

9,6

39,5

16,6 47,7

5. INDUSTRY TRENDS 2013/2014

44,3

57,5

10,2 44,5

9,7 41,9

88,3

77,3

62,0

72,6

55,6

47,0

53,1

66,5

10,1 43,2

31,5

22,8

79,2

26,1

12,8

36,6

75,8

71,1

80 % Badoo

67,0 37,8 23,6

Mitglieder Umsatz 2011

8,5

1,9

4,2

11,6

2003 due 2004 2005 2008 2009“social” 2010 2011 2012 Despite all of the changes to2006 the2007 factors and2013 “mobile”, Match.com > 50 Mio. ~300 Mio. Eurothe highthe market is still dominated by the established players: priced quality providers in the area of “serious” online dating, Badoo > 130 Mio. ~100 Mio. Euro because, above all, singles over 30 are happy to pay. The “big five” in the industry together of the total Meetic account > 40 for Mio. over 17860% Mio. Euro Match.com revenue.

Parship

> 10 Mio.

~40 Mio. Euro

The new social dating players as well as the flirt appsBadoo such as Tinder have so far succeeded to acquire a great reach rather Meetic quickly and cheaply thanks to primarily Facebook and the app stores. Now, they have to prove that they can stabilize this growth Parship long term. 10,8

10,2

8,5

7,3

5,6 2,6

10,4

16,6 47,7

36,6

62,0

72,6

Parship ~100 Mio. Euro

9,7 41,9

88,3

77,3

53,1

> 10 Mio.

~40 Mio. Euro

27,9% 10,8

10,1 43,2

10,2

> 40 Mio.

178 Mio. Euro

> 10 Mio.

~405,6Mio.16,6 Euro

23,97,3%

10,2 44,5

~100 Mio. Euro

Match.com

> 130 Mio.

31,5

22,8

> 130 Mio.

> 50 Mio. ~300 Mio. Euro Mitglieder Umsatz 2011 Market Shares (revenues) Meetic >Badoo 40 Mio. >178 Mio. Euro 130 Mio. ~100 Mio. Euro Match.com > 50 Mio. ~300 Mio. Euro Meetic 7,9% > 40 Mio. 178 Mio. Euro Parship ~40 Badoo> 10 Mio.> 130 Mio. Mio. Euro 10,8Mio. %~100Euro Mitglieder Umsatz 2011 Parship > 10 Mio. ~40 Mio. Euro Meetic 178 Mio. Euro 29,5 % Euro > 40 Mio. > 50 Mio. ~300 Mio.

23,2

71,1

1,8 7

2,6

10,4

9,6

39,5

47,7 1,1 5,7 6,3 66,5 1,8 8,5 10,87

8,5

31,5

22,8 1,853,1 7

12,8

36,6

10,2 44,5 8,5

7,3 5,6

16,6

2,662,0

10,4 72,6

9,6

39,5

26,1

7,3

5,6 44,3 10,4

16,6 57,5

47,7 8,5

9,7 10,110,8 41,910,2 43,236,6

22,8

31,5 79,2

44,5

31,5

88,3 53,1 77,3 10,2

22,8 66,5

10,2

62,0 10,8 36,6 75,8

62,0

72,6

10,2 72,6 44,5

88,3

71,1

68,9 88,3

58,1

26,1 The former midsection has a quite difficult task trying to continue 75,8 67,0 12,8 57,5 Social Dating 55,6 47,0 37,8 1,1 to exist between these fronts. The specialized ones still have a good chance as long as 44,3 5,7 Personals 23,2 2003 2004Online 2005 2006 2007 2008 2009 23,6 2010 2011 6,3 they are not confined to one country. Matchmaking 1,8 7

1,1 5,7 6,3 8,5

9,6

39,5

79,2

26,1

12,8

44,3

57,5

66,5

75,8

67,0

55,6

47,0

37,8

23,2

23,6

1,9

4,2

11,6

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2,6 1,8 7 1,1 5,7 6,3

9,6

8,5

8,5

7,3

5,6

16,6

44,3

8,5 62,0

12,8 36,6

23,2 9,6 10,2 26,1 44,5 44,3

23,2

72,6

88,3

39,5

79,2

57,5

10,4

47,7

53,1

Adult

7,9%

39,5

79,2 57,5

66,5

75,8

68,9 58,1

23,2

29,5% 2003 2004 2005 2006 2007 2008 2009 201045,8 2011 % 8,5

47,7

53,1

75,8

66,5

68,9

58,1

1,9 Dating

4,2

11,6

Niche 2003 2004 2005 2003 2006 2004 20072005 2008 2009Dating 2010 2011 2012 2006 2007 2008 2009 20102013 2011

26,1

12,8

22,8

10,2 1,1 5,7 31,5 6,3

2,679,2

ElitePartner, eDarling, Parship, FriendScout24: ElitePartner, 54,2 %eDarling, Parship,54,2 % FriendScout24:

10,8%

THE ONLINE DATING MARKET IN THE UK 2013–2014

4

Behind this study: leadingdatingsites.co.uk

ABOUT THE STUDY This study „The Online Dating Market in the UK 2013-2014“ is part of a yearly up-to-date analysis on online dating in Europe. This study, first conducted in 2004, has established itself as the only serious market examination in the industry. The figures are based on market research, Internet traffic analysis and above all, direct discussions with executives from the leading service providers.

ABOUT LEADINGDATINGSITES.CO.UK LeadingDatingSites.co.uk is a free online portal focused on providing:

»»Review and evaluation of online dating sites »»Advice for beginners and experienced online daters Since 2008, more than 250,000 singles from the UK have used this portal as their gateway to memberships in their desired online dating site. Recommendations, interviews, or test report claims have been published in over 100 press, TV and radio outlets.

leadingdatingsites.co.uk singleboersen-vergleich.ch singleboersen-vergleich.de singleboersen-vergleich.at guide-sites-rencontres.fr

ABOUT METAFLAKE Based in Cologne, Germany, the metaflake network has 12 fulltime employees and currently operates online dating review websites in 14 countries.

guida-incontri.it sitios-encuentros.es dejting-experten.se nettdating-eksperten.no netdating-eksperter.dk datingsitesreviewed.com sites-encontros.com.pt central-encontros.com.br datingsitesreviews.com.au

WWW.LEADINGDATINGSITES.CO.UK For more information, please contact: Henning Wiechers metaflake metaflake Riehler Str. 21 D-50668 Cologne, Germany Tel: +49 (221) 130 87 10 [email protected]