Recently, I posted an article about the possible unbundling of Airbnb. The article led me to have a conversation about other examples of unbundling with my former roommate and #1 fellow BB Ki Vines fan Raj Bhuva. Raj rightly pointed out that Tinder has been a prime target of unbundling. There have been some accounts of a decline in the popularity of Tinder (although the pandemic did boost engagements and app downloads) and while a lot of that probably has to do with other factors, I’d definitely attribute some of it to the rise and gaining popularity of other, more niche competitors. I’m curious to see how some of the points and frameworks I made in the Airbnb article would hold up when talking about a different platform. (If you haven’t read that one yet, check it out here)
Tinder was founded in 2012 and seemingly revolutionized online dating with its classic swipe (which was originally a green heart and red x) functionality and double opt in match feature. It saw incredible growth, and by May 2013 (within a year!) was one of the top 25 social networking apps online. In a poster unbundling fashion though, Tinder’s competition today primarily consists of apps with similar-ish interfaces but targeted towards niche use cases or demographics –
- Bumble – Founded in 2014 by one of the founders of Tinder, when it comes to UX Bumble in my opinion is essentially a replica of Tinder with the added constraint that women must send the first message. Bumble is thus sometimes referred to as the ‘feminist Tinder’, and its userbase is considered to be slightly more educated and career oriented
- Hinge – Explicitly branded as ‘designed to be deleted’, Hinge’s user base consists primarily of users looking for a relationship, as opposed to casual encounters. The app’s interface, while still largely image driven, has a more robust filter functionality, and features some questions to help people get to know potential matches better.
- Dil Mil / JSwipe/ etc – Dating applications geared specifically towards racial demographics have also sprung to challenge Tinder. Dil Mil (for South Asians) and J Swipe (for Jewish singles), both founded in 2014, that fall in this category.
- Grindr – While Grindr was founded in 2009 (before Tinder), I mention it here as a representative of apps specifically geared towards same sex dating. Like Tinder, Grindr is heavily image driven, and has a grid interface to show available men in an area. Zoe, Her, and Scruff are other similar apps for directed towards the LGBTQ+ community.
(While websites like Plenty of Fish, Match.com and OkCupid also have significant share in the online dating world, I don’t list them here as they were launched before Tinder, represent a different style of online dating (less gamified more connection and website rather than app based), and aren’t exactly examples of unbundling as they don’t look to take out a chunk of Tinder’s business.)
In the previous article, I listed out a set of factors that help determine a platform’s susceptibility to unbundling. Let’s see how that stacks up with Tinder, and whether the framework needs revisiting.
- Size – GMV can’t be used here (lol), but Tinder has an estimated 50 million users. Seems large enough, and definitely unbundle-able.
- Pace of innovation – I don’t think Tinder has many problems here. Tinder’s quick to try to adjust to the times – for example in response to the pandemic it’s trying to launch an in -app video chat feature. Honestly speaking, this dimension was added primarily to account for Craigslist’s unbundling. I don’t think many modern day companies are slow to innovate (although this doesn’t mean they should be complacent towards that – they should always keep an eye on competitors and trends)
- Decomposition of value proposition – I think Tinder’s value proposition isn’t too decomposable. An argument could be made to maybe separate the processes of finding a match and communicating with the match (which who knows, may become more and more important especially if the app is trying to let you video chat with matches immediately raising a whole new host of safety and other issues), but don’t think this is a big worry for Tinder.
- Diversity of use cases – Tinder has a very diverse user base, and people have different motivations in using the Tinder platform. Obviously, this is where Tinder’s getting attacked – be it through a segmentation of the user base by race, sexual orientation, age?, or by use case (with apps like Hinge geared towards serious long term relationships rather than casual hookups).
Based on the Tinder example, I believe the unbundling framework laid out in my previous article could be changed to break this dimension into two – diversity of use cases, and segmentation of user base. They’re still correlated as often times different segments of the user base have different use cases of the value proposition, but are still two different ways of thinking about unbundling. For example, let’s take Uber – unbundling by segmentation of user base would be ‘Uber for seniors’ (maybe with special features such as increased care, in-car amenities etc), whereas unbundling by use case would be ‘Uber for special occasions’ (Uber Black!). You could maybe argue that Uber Black is directed towards a richer segment of the user base and is thus unbundling by segmentation – it’s very case by case. - Frequency of Use – Those who use Tinder use it a lot – there are anecdotal reports of people spending hours on the app every day. This makes it prime for unbundling in my opinion – such consistent use highlights the shortcomings/annoyances of the app, and users yearn for a more tailored experience.
Tinder is thus a large platform, has high use frequency, diverse use cases and a very diverse user base – and that’s what’s attracting this onslaught of competition. That said, there’s a couple of interesting things to note in the Tinder unbundling saga –
A lot of these platforms are owned by one company:
The chart above shows the audience size of the most popular dating platforms in the United States as of September 2019. 5 out of the top 7 names are owned by one entity – Match Group (which itself separated from IAC extremely recently). This dating giant holds a massive portfolio of dating platforms, including Tinder, Match.com, Meetic, OkCupid, Hinge, PlentyOfFish, and OurTime. They’ve also been reported to try to acquire Tinder’s #1 competition Bumble multiple times. This reminds me of a point I talked about in the previous article – acquisition strategy. This is a poster example of that. Leads me to think that that’s why Tinder is fine with letting Hinge occupy to relationship space. Speaking of which,
Tinder seems to be calmly occupying the hookup space:
While apps like Hinge and Bumble are pretty geared towards relationships, Tinder has been gaining reputation as a hookup app. This could honestly be intentional. Recognizing that a one size fits all approach leaves Tinder too vulnerable to a full scale unbundling, Match Group might be letting this reputation grow while growing Hinge as the ‘relationship app’ in their portfolio.
While the dynamics with dating apps are pretty different than those in the short-term rentals market, it’s interesting to see how a similar framework on unbundling can be applied with similarly applicable results/findings. Would love to see what new apps come to pick away at Match Group’s portfolio.