Business Model of Tinder: World’s Favourite Dating App

Business model of Tinder by Business Gamut, Businessgamut.com

Tinder is an online dating platform and is one of the most downloaded applications on smartphones. It ranks 2nd in the lifestyle category on the Apple App Store. Having started its operations in September 2012, it has a revenue of approx $1.2 billion in FY2019 a 43% increase from previous year and is the market leader in the online dating industry. The company is owned by Match Group which is parent to OkCupid aswell. Tinder is backed by investors like Primak Ventures, IAC, and Benchmark.

Here is the simplified business model of Tinder by Business Gamut

Who is Right Swiped by Tinder: Customer segmentation

  • Tinder has straightforward customer segmentation: those people who want to date someone
  • The target segment is Gen Y and Gen Z living in cities
  • Tinder targets internet consuming college students(Gen Z) and working professionals (Gen Y)

Why is Tinder right-swiped by people: Value Proposition

  • Finds people to hang out with, to go on a date. Meet strangers who have similar interests.
  • Offers the convenience of finding someone whom you would not find otherwise
  • Reduces the social embarrassment of getting rejected in public
  • Enables access to people of diverse demography on your phone

Where does Tinder chat: The Communication Channels

  • Tinder is a digital company and uses digital channels to communicate its value proposition to the audience
  • Mobile App is the major channel of communication, there is web interface as well
  • Tinder is known for its amazing social mediacontent, keeps the audience engaged very well, Tinder writes excellent blogs explaining the features and other blogs which speak about dating tips
  • College fests and other events sponsored by Tinder
  • The mobile application gives the details of paid plans and pricing while you are using Tinder on your smartphone

 How is Tinder maintaining the relationship so well: CRM

  • Tinder focuses on consumer self-service rather than a direct relationship with them
  • The application UI is very intuitive and self-service is very easy
  • Customer care can be availed over mail and FAX(Literally)

How can Tinder afford these many dates: The Revenue Streams

Revenue Stream of Tinder, Business model of tinder, business gamut, www.busniessgamut.com
Revenue Streams of Tinder

  • Tinder has a Freemium business model: basic services are given free of cost and enhanced versions with more control over how you can use the services
  • Subscription Fee: Tinder Gold and Tinder Plusare two premium services with extra benefits
  • An in-app purchase of extra features 
  • Tinder Plus costs Rs. 354/ month and Tinder Gold can be availed at Rs. 567/ month
  • Advertisement fee is one major revenue stream for tinder, Banner ads and video ads are shown on tinder. These cost somewhere around  Rs. 7 per 100 impression for banner and Rs. 115 per 100 impressions for video ads. 

Key resources that Tinder possesses

  • The key resource for Tinder is the mobile application itself
  • There are around 60 odd employees working for Tinder according to Owler
  • Intellectual Property is basically the key resource

Do they work or Just Swipe: Key Activities

  • Keeping the platform up and running with least downtime and keeping the customer data safe
  • Marketing is a major activity which keeps tinder afloat, they have to come up with new campaigns like “Swipe Night” etc. time to time to stay as the favourite dating app

Buddies of Tinder: Key Partners

What are the things that burn the Tinder’s cash: Cost Structure

  • Platform Maintenance and employee salaries are the sizable cost centres
Hope you understand how the world’s favourite most dating app is running its business through this simple business model. We would like to hear your thoughts about the blog, please tell us in the comment box given below.

3 thoughts on “Business Model of Tinder: World’s Favourite Dating App

  1. Thank you for your comment.Tinder has so many competitors now offering multiple options on single platform. For example, Bumble: Which give you options to not only get dating matches but also business match and match with people who just wants to make new friends.Competition is getting fierce day by day. We would write a separate blog addressing your questions.Cheers!

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