Match Group’s CEO on Innovating in a Fast-Changing Industry
When the author began working at Match, in the mid-2000s, online dating often required monthly fees and endless patience. It was mostly done by middle-aged people sitting at PCs who scrolled through profiles and waited for responses. If they found and connected with someone, they’d often claim they “met through friends” to avoid the stigma that online dating carried.
Since then, significant industrywide shifts in technology and business models have completely changed how people use Match products. Now online dating is done via apps on mobile phones; it has moved from monthly subscriptions to a “freemium” pricing model; and it has been embraced by people in their twenties, who are the dominant users of Tinder and similar brands. Mandy Ginsberg describes what it’s like to lead in an industry with such fast innovation cycles and discusses incorporating full-motion video into dating apps—part of an effort to predict whether sparks ignited online will persist as chemistry in real life.
The transformation that has taken place at Match Group since I first began working here, 12 years ago, is incredible to contemplate. Back then dating websites were accessible only from a desktop or a laptop. They often required monthly fees and a lot of patience from users, who scrolled through profiles and waited for responses. Online dating also carried a definite stigma, so if a couple had met on Match, they often lied and said they’d met “through friends.” Although the sites had rudimentary matching algorithms in their early days, most users relied on “open search”: They read many profiles that might have little relevance in hopes of finding someone they really wanted to meet.
If you describe that process to a 25-year-old Tinder or Hinge user today, it sounds as antiquated as fax machines. Over the past decade, significant industrywide shifts in technology and business models have occurred—the biggest one being mobile. They have completely changed the way people use our products, which now run almost entirely via apps and smartphones. Those product changes have been accompanied by an attitudinal shift: In the New York Times Weddings section on Sunday, people now routinely mention the dating app on which they met. Research shows that 35% of marriages start online, up from around 3% when I began working here.
The speed of change is one of the things I love about this industry. Each shift has made us completely rethink our approach. I’ve built my career trying to develop consumer insights and use them to create appealing new products. Match Group is a great place to do that. Perhaps the biggest lesson I’ve drawn from this experience is that companies need to innovate constantly—with technology, pricing, product features, and business models—to stay ahead of competitors and continue to grow.
Not many large companies have female CEOs, which has caused me to reflect on why my upbringing compelled me to pursue this kind of career. I count three big influences that led me to my current role. The first is that I grew up in a matriarchal environment. I’m the product of a very strong mother, I’m one of three daughters, and I attended an all-girls school while growing up in Dallas. All my early role models were women, and expectations were high for me and my sisters to pursue careers.
The second factor was that I played competitive soccer and was recruited to play for UC Berkeley, which had one of the strongest teams in the country. I wasn’t the biggest or the fastest player, but I understood team dynamics and could recognize people’s strengths and weaknesses and help find ways for us to play better together. Only later did I recognize how useful that skill is when one is leading people—and teams—in business.
Finally, I grew up in a very entrepreneurial environment. My father and grandfather owned their own businesses. Looking back, I can’t recall any family member who had a traditional 9-to-5 job. That atmosphere taught me the benefits of thinking like an entrepreneur and taking risks.
After college I moved to Israel and worked for a few years at a tech company. I met my first husband while I was there. In 1994 we moved to San Francisco, where I joined Edelman, a large public relations firm. I spent nearly five years working with Silicon Valley tech companies. It was an incredibly exciting time to be in the Bay Area, and I loved working on strategic marketing plans for high-tech companies, but I knew I wanted to run a business and not stay in marketing forever. I realized it was time to move on and enrolled in Wharton’s MBA program; my husband and I and our infant daughter moved to Philadelphia.
A week after I signed my student loan, my husband told me he was leaving and wanted a divorce. In an instant my whole world changed. I was alone, without the support system I had expected, in a demanding MBA program, with a one-year-old child. It was a life-changing experience, but I graduated from Wharton stronger than before, and I made lifelong friendships and connections in the process.
As I finished at Wharton, my mom was diagnosed with ovarian cancer. I wanted to move back to Dallas to be with her and my family. While she fought the disease, I became the head of marketing at a B2B tech firm that made supply chain management software. It wasn’t the perfect fit, but it was important that I be nearby during what turned out to be the last two years of my mother’s life. I also met my current husband at that company.
Soon after my mother died, I got a recruiting call from Match. The company was looking for someone who had a background in marketing to run Chemistry.com, the start-up it had launched to compete with eHarmony, which had launched a few years earlier. To join eHarmony, users had to fill out a lengthy psychological profile, and the site’s stated mission wasn’t to help people date but to help them marry. Because Match wasn’t set up explicitly for finding spouses, eHarmony caused its image to change: Match became seen as a site for casual dating, whereas eHarmony was for “serious” dating. I ran Chemistry.com from 2006 to 2008. It was my first general management job, and I loved building the team. We grew the site quickly.
But even as Chemistry.com expanded, the company’s flagship Match.com seemed to be plateauing. So in 2008 management asked me to move over to Match.com and try to reenergize that brand.
Two important shifts were under way that hurt Match.com. First, OkCupid and Plenty of Fish, recent entrants, had pioneered a new business model: Instead of charging users monthly fees, they relied on advertising for revenue. That attracted people who were interested in online dating but reluctant to pay for it, and it marked the beginning of an era in which companies rethought how to price and monetize their platforms.
The second shift involved algorithms. All the early dating websites had search functionality, and all asked users to specify the type of people they hoped to meet. But by 2008 companies were getting more sophisticated about analyzing and understanding users’ preferences and behavior. We rolled out a feature whereby every Match.com user was sent five Daily Matches, and we monitored whether people liked them or not. We began hiring more data scientists and changing our algorithms to more closely track users’ actual behavior rather than their stated preferences. For example, if people say they prefer to date tall blondes but they’re sending messages to short brunettes, our algorithm should recognize that and send them matches that reflect actual activity patterns. Because our data tells us what types of profiles users like, we also began to encourage them to send messages or likes or winks, rather than just peruse profiles—after all, no dating can actually occur unless someone reaches out first. We began advertising on television, which was very successful because it made online dating seem mainstream.
As these two shifts took place, we initiated a third that became an important driver of our growth. In 2009 Match made its first big acquisition, in the form of a company called People Media. Unlike Match, which ran just two websites, People Media had a variety of smaller sites aimed at specific demographics—for example, BlackPeopleMeet.com and SeniorPeopleMeet.com (now called OurTime.com). Online dating relies on network effects, so in theory a very large site should be more successful, because it has a deeper pool of people to date. But we’d already seen the advantages of having a variety of targeted brands when the market segmented into “serious” and “casual” dating. Now Facebook and Twitter were bringing more people onto social media, which sparked more interest in online dating, especially from older people. If it was suddenly socially acceptable to meet friends online, why not dates? As the age range of our users began to broaden, providing sites that appealed to various demographics became more important. No one wants to be on the same dating platform as a parent or a grandparent. Over time, Match acquired other brands, including OkCupid and Plenty of Fish. Today we have dozens of dating products that operate around the world. When we acquire a new brand, we have a lot of experience to help it grow.
But without a doubt, the biggest technology shift came after 2008. That’s when Apple introduced the App Store. Smartphones were becoming ubiquitous, and most dating platforms began migrating away from desktops and onto apps. Within a few years that completely changed the face of our industry—a change sparked largely by Tinder.
In 2012 Tinder came out of an incubator that IAC, Match’s parent company, had started; it’s now part of our portfolio. It was very different from existing dating products. From the beginning, it was designed for smartphones and existed only as an app. Tinder was location-based, so users could see who was nearby, which brought spontaneity to the industry. Instead of long profiles, which would be hard to read on a mobile device, Tinder relied on photos and a very short bio. Its biggest innovation was swiping—swipe right if you find someone attractive, left if you don’t. When two people swipe right on each other, Tinder notifies both of the mutual attraction. If people know the attraction is mutual, they’re more comfortable initiating contact. This was great for women: It was the first time they could filter potential matches and choose whom to talk to, as opposed to getting unsolicited messages.
Tinder introduced its product at a number of universities. It went viral among college students, and we never imagined how fast it would grow. Before Tinder, relatively few people under 30 used online dating. Today Tinder has tens of millions of users, and the majority of them are between 18 and 25. Young people who use it tend to also use two or three other dating apps, which makes our strategy of owning a portfolio of brands even stronger.
Most dating apps, including Tinder, have shifted to a “freemium” or paywall strategy. Joining is free, and users get basic functionality. They can opt to pay for premium features such as seeing who likes you and swiping in another city. Last year Tinder’s revenue topped $800 million, demonstrating that many people are willing to pay for these features.
When we create a feature that works well on one of our apps, we roll it out across our other brands. There’s a lot of copycatting among our competitors as well, which can make it hard to sustain the competitive advantage created by innovations. When possible, we take steps to protect our intellectual property. In 2017 we patented some of Tinder’s key functionality, and since then we’ve taken steps to defend that IP. [Editor’s note: Match Group has filed a lawsuit against Bumble, a dating app created by one of Tinder’s original employees, alleging patent infringement. Match Group has also reached settlement agreements with other companies that utilized the swipe.]
By 2017 I had led some of Match’s biggest brands, and the board asked me to become CEO. Today I spend much of my time trying to understand what customers want and need from our products and how we can innovate to help satisfy those needs even better.
Right now we’re working on several new strategies that we expect will drive our next phase of growth. I’ve always thought it ironic that people refer to our industry as “online dating” when no one really ever dates online—at a certain point you meet face-to-face. Too often, the spark that was ignited online dies out when people actually meet. The holy grail of our industry is finding ways to use technology to better predict whether that chemistry will persist in real life. If a company could reduce the number of unsuccessful dates, customers would be even more satisfied.
Video is one of the best tools for that. If you’re unaccustomed to talking to people by video, it can feel awkward. But you get used to it. Our company uses video calls extensively—I’d say 90% of my work calls are now done on video. You can pick up so much more about people when you can see them—how they carry themselves, their sense of humor, their confidence. Using video for online dating isn’t a new idea. Years ago we owned a dating platform that let users post videos. People didn’t know what to say, so we saw a lot of 10-minute videos of someone reading aloud from a book. That’s not very useful. But the market is better able to use video now. Millennials post videos of themselves on Instagram and Snap, so they’re naturally comfortable with the format. We’ve begun allowing users to post video snippets on Tinder, where users tend to be younger; for our brands where users tend to be older and less comfortable posting videos of themselves, we’re working to find more-natural ways to let their personality come through on video without their feeling embarrassed. Considering how quickly this industry changes, I can only imagine how video may be used on these apps in five years.
There’s an epidemic of loneliness in the world, and we need to address it.
We’re also expanding in international markets where online dating is less mature. Markets across Asia tend to have lots of young singles with smartphones and evolving dating norms. For Indians of my generation (I’m in my forties), arranged marriages were common. That’s changing. In fact, my second husband is Indian, and he was the first person in his family to forgo an arranged marriage. In Japan, until recently, a stigma was still attached to online dating. We bought a brand called Pairs, which is the top app for serious dating in Japan, and it’s been growing quickly. These markets are very exciting for us as we look to the future.
Match Group has a lot of scale and expertise, and we’re trying to use those advantages to be smarter and faster than our competitors. We need to keep innovating, because this is meaningful work. There’s an epidemic of loneliness in the world. People are beginning to understand the health implications of that, and we need to address it. Even in a technology-driven society, people crave intimate connections, whether that means getting married or just sitting down together for coffee. We help people make those connections. Finding more-effective ways to do that has proved very fulfilling.
Mandy Ginsberg is the CEO of Match Group.
Match Group’s CEO on Innovating in a Fast-Changing Industry
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