By Gabriel Sanchez
(Bloomberg) — Dating apps are embracing AI and expanding their subscription plans in hopes of attracting more paying users — especially Generation Z — with new premium and discount plans amid slowing growth.
Match Group Inc. is seeing “significant demand” for its new weekly subscriptions – the number of Gen Z women living in the U.K. switching to a paid Tinder plan has risen 73% since its April launch, and the increase at Hinge has been similar. Match is also exploring a $500-a-month version to launch in the fall. Bumble Inc., which already has a weekly offering, will begin testing a premium tier later this year, alongside a cheaper option aimed specifically at Gen Z. Grindr Inc. said its new weekly option is also driving monetization, and is exploring cheaper options and a premium tier.
The premium offerings are aimed at people who want a more curated, matchmaking-style experience. “They feel like the relative value of $40 or $50 a month to their special someone seems exceptionally low,” Bumble CEO Whitney Wolfe Herd said on a recent quarterly earnings call. The cheaper options are specifically aimed at Gen Z. “When you think about Gen Z, not everyone has disposable income,” Herd said.
Match, the largest dating app maker, is struggling with a decline in paying users – growth came to an abrupt halt at the end of 2021 and user numbers have been falling for three consecutive quarters. Bumble’s paying users continue to grow.
Dating companies are also using generative artificial intelligence to attract users with new features. Bumble sees it as a way to “curate partner suggestions,” Match hopes to “avoid awkwardness,” and Grindr sees “new use cases for interaction.”
They’re also tinkering with the apps themselves — Grindr, which now faces competition from Match’s new Archer app for gay, bisexual or queer men, plans to build more adult features into its new web browser version. Archer is currently only available in New York City, but is set to expand nationwide by the end of the year.
The focus on Generation Z also has its downsides. According to Match, weekly subscriptions make it difficult to forecast subscriber numbers: “They are new and harder to manage,” said Chief Financial Officer Gary Swidler on a recent quarterly earnings call.
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