Tinder struggles to attract younger users as Gen Z singles look to new apps

Tinder is struggling to attract younger users who are starting to abandon the world’s dominant dating app, as Generation Z singles prefer hotter new services in the search for love after lockdowns.

The well-known app quickly became the dating service of choice for millennials since launching in 2012, as consumers switching from desktops to mobiles left older platforms such as eharmony and Match.com.

The latest generation of young people, who are returning to the dating scene after the pandemic, also appear to be shifting to alternatives to Tinder in the hunt for romance.

Downloads of Tinder, which allows users to accept or reject potential partners with the swipe of a smartphone screen, dropped 5 per cent in 2021 to 70.7mn. Rivals such as Bumble and new start-up Thursday have enjoyed consistent growth, according to new figures from app market researchers data.ai.

That trend has led Tinder to make changes in an effort to achieve new growth, from restructuring its leadership to betting on the so-called metaverse as the future method by which people will meet online.

“Sign-ups have not returned back to pre-pandemic levels,” Gary Swidler, chief operating officer and chief financial officer of Tinder parent company Match Group, told the Financial Times.

“New users remain a challenge and that’s where product innovation comes in. We need to give people a new reason to come into the [dating app] category, they haven’t had something new and exciting in a while.”

His comments come just weeks after Match said Tinder was failing to meet revenue growth expectations in its second-quarter results, ousting the company’s chief executive Renate Nyborg after less than a year in the role.

Match, which owns a host of dating sites including established brands such as Plenty of Fish and OKCupid, needs Tinder to retain its dominant market position. The app generated $1.65bn in revenue last year, more than half of Match Group’s total revenue.

The group’s share price has dropped more than 50 per cent this year, with its heritage platforms, such as Match.com, suffering declining revenues and paying users.

“It is on us to figure out what is the next great thing [in dating],” said Swidler. “It tends to come with technological evolution or revolution.”

One of Tinder’s big bets is the metaverse, where enthusiasts believe people will increasingly interact in virtual environments. Tinder is doing this through further gamification of the app, hiring executives from games companies Zynga, Electronic Arts, Glu and King in recent years to bolster its offering.

The platform is finding it tricky to execute this vision, rolling back its virtual coins feature this month, used for in-app spending, having only launched in November, after seeing mixed results.

The company is still figuring out how these features can effectively contribute to Tinder’s revenue and is currently reassessing the model. It plans to relaunch coins and introduce virtual goods on Tinder in the second half of 2023.

“A lot of older people are using Tinder now,” Swidler said. “If you’re looking for somebody who is a teenager and you’re thinking what are they going to use in a year or two when they are dating app eligible? That’s the audience we have to be looking at, the Gen Z audience.”

Reaching that audience is a challenge. More than 90 per cent of that generation feel frustrated with dating apps, according to Gen Z research agency YouthSight. They also feel less inclined to be in a relationship, with 40 per cent of respondents saying they were “happily single”.

Millie Shields, a 24-year-old influencer who creates TikTok videos about dating, said Tinder has a negative reputation, known for hookups rather than long-term dating.

“[Young people] tend to want to meet someone organically rather than have it forced on a dating app,” she said, adding that many people just use Tinder for entertainment.

Swidler said this stereotype was “hard to shake” but that the platform had now evolved and it was focused on making it a safe and positive space, including through the launch of a female-oriented subscription later this year.

“The key thing is the user experience being up to standard, making sure you actually are tackling those issues that younger people are very upfront about [like] abuse, harassment and unpleasant experiences,” said Rebecca McGrath, a senior technology analyst at market research provider Mintel.

“Tinder has tried getting into these other areas like currency and talking about the metaverse and . . . that’s not necessarily where they need to be putting their focus.”

Match does not share demographic figures of age or gender for Tinder, but estimates from data company App Ape suggest that 76 per cent of US Tinder users are male. Rival app Bumble’s design means women must initiate conversations on the platform — only they can send the first message to potential suitors.

Bumble increased downloads by 20 per cent last year to 21.1mn, according to data.ai, while fledgling app Thursday, which encourages in-person meetings, increased from under 1,000 downloads in 2020 to more than 200,000 last year and a further 100,000 in the first quarter of this year.

The introduction of gaming-inspired features and new subscriptions is aimed at boosting revenue as Tinder’s model relies on users paying for subscriptions or one-off spending.

In the second quarter of this year, Tinder had 10.9mn paying users — up 14 per cent year on year — amounting to more than 60 per cent of the Match Group’s total paying users who spend a monthly average of $15.86 per person.

In comparison Bumble has more than 1.9mn paying users, spending an average of just under $30 per month.

Both Tinder and Bumble declined to provide figures for total users, including those using the app for free.

However, as the cost of living increases, consumers are cutting down on discretionary spending such as digital subscriptions, which the company anticipates will impact revenue.

“Paying even a small amount for online dating is probably for many people a fairly easy cut if they can have a fairly equivalent free experience,” McGrath added.

Swidler remains confident about Tinder’s outlook. “Tinder is still the largest dating business in the world,” he said. “And that has a significant advantage because if you want to meet people, the best place to go is where there’s a lot of people.”

Additional reporting by Dave Lee in San Francisco and Rafe Uddin in London