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How Does Tinder Make Money? The Tinder Business Model In A Nutshell

Tinder is among the most popular dating apps. Initially named MatchBox, it leveraged a “double opt-in” mechanism that helped remove the initial friction of having to meet strangers. Later on, the product was renamed Tinder. The company (now parts of the Match Group) makes money via its main subscription plans and premium features like boosts and super likes.

Origin Story

Tinder is a North American online networking and dating application.

The prototype for the app, named MatchBox, was created at start-up incubator Hatch Labs by Sean Rad and Justin Mateen. Rad had identified an absence of platforms allowing users to meet each other and noted that a “double opt-in” system could alleviate the stress of interacting with strangers.

Six months after creation, the prototype was renamed Tinder to match the flame logo designed by eventual CCO Chris Gulczynski. Then began an aggressive marketing campaign, which involved launching the app at multiple college campuses. By 2014, there were over 1 billion swipes per day equating to 12 million matches.

Tinder became a part of Match Group in 2017, a portfolio of popular online dating services including OkCupid, Meetic, Match.com, and PlentyOfFish. As of Q4 2020, Tinder had 6.7 million paid subscribers, with almost 1 in 5 adults in the United States having used the service.

Tinder revenue generation

Tinder operates on a freemium model of revenue generation.

The app is free to use, but Tinder subscribers can pay for a variety of added features and functionality. Let’s take a look at them below.

Subscription tiers

In addition to the free “plan”, users can upgrade to one of three paid plans:

  1. Tinder Plus – starting at $9.99/month, users get unlimited likes and rewards with 5 super likes per day. Location can also be changed for those using the service while on vacation.
  2. Tinder Gold – starting at $29.99/month, users get all Tinder Plus features in addition to top picks and the ability to see who likes them.
  3. Tinder Platinum – a relatively new plan starting at around $39.99/month. Platinum users can message others before they match and see prioritized likes.

Prices for each plan vary according to geographic location and market, particularly if the company is beta-testing new features. Like many subscription services, a cheaper price can be obtained by paying six-monthly or annually. For example, the cost of the Tinder Plus plan drops from $9.99 to $4.17 per month if paying yearly.

Prices are also dependent on age, which has attracted some controversy. Users over 30 years of age are generally charged much more for equivalent service than those under 30. Anecdotal evidence suggests that price is also dependent on geographic location and sexual orientation.

Tinder argues that its dynamic pricing allows the more budget-conscious younger generation to access paid subscriptions.

Premium features

For users who want extra functionality without signing up for a plan, they can pay for premium features on a once-off basis including:

  • Boosts – which increase visibility.
  • Super Likes – which provide extra social signals of profile popularity.

Again, prices are dependent on the abovementioned factors and cheaper prices can be had if purchased in bulk.

Key takeaways

  • Tinder is an American online dating and networking application. It was created by Sean Rad and Justin Mateen at start-up incubator Hatch Labs. Originally called MatchBox, the name was changed in 2012 to reflect a previously designed logo.
  • Tinder operates on the freemium model with three paid plans for extra functionality. Prices are highly variable and are dependent on age, geographic location, and whether plan features are being tested in new markets.
  • Tinder also gives free users a chance to enhance their experience by purchasing Boosts and Super Likes.

Read Also: How Does Bumble Make Money.

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Published by

Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which reached over a million business students, executives, and aspiring entrepreneurs in 2020 alone | He is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate | Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy | Visit The FourWeekMBA BizSchool | Or Get The FourWeekMBA Flagship Book "100+ Business Models"