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Inside The Online Dating Industry
by Joe Tracy,
publisher of Online Dating Magazine
Another
Look: Starting an Online Dating Service
A
year ago I wrote an article focused on those thinking
about starting
an online dating service. It was a reality
check article. Now, a year later, it's time to revisit
the subject and give you a heads up on a service that
is doing everything right in its quest to be one of
the 1% success stories. That's right... 1%.
Out
of every 100 online dating services that are started,
99 of them will fail and never make a profit. Everyone
starting a new service thinks they'll
automatically be
a part of that 1%, but then again, many Americans also
think they'll one day win the lottery. The harsh
reality is that from the time you launch your service
you are part of that 99% and only those who know how
to prevail will change that fate.
Every
week I receive several emails from people telling
me they are starting a new service. DateLists.com,
an online dating directory, receives three new registrations
a day from new online dating services. They have
to delete about as many entries a day from the archives
from failed services. Overall, there are close to
1,000 new online dating services opening every year.
It's an oversaturated market that everyone thinks
is easy to break into.
It's
not.
There's
a lot of online
dating software out there to help
people "break into the industry". There's a lot of
templates for sale on eBay. It seems like an "easy"
and "profitable" industry to be a part of. The main
problem, however, is that online daters want
to be a part of something that's already established. Even
if you offer a "free lifetime membership" to the
first 20,000 members, it will take awhile to reach
that plateau. Why? Because when a person sees that
there are only three members on the dating service
(you, your mom, and your best friend), they turn
and run. What good is a free membership to them when
there are only three members and they all live in
Jasper, Wyoming?
I'm
pleased, however, to tell you that there are some
online dating services that do make it past the growing
pains and into success. These 1% of gems are rare
and being able to study one doing things right is a great
opportunity.
I've
mentioned to you before a new service called Let's
Grab a Drink. I first learned about this service
when they contacted me about advertising in
Online Dating Magazine. Now, I must admit that the
second I learned it was a new online dating service,
I was immediately skeptical. A new service can advertise
all they want, but if they can't convert clicks into
members (the major failing of most new services),
then they will fail.
So
here I was conversing with the president of Let's
Grab a Drink, before its launch, when he said
two things that really struck me:
1) Let's
Grab a Drink would have a refund policy (try
finding that on any major online dating service).
2) Let's
Grab a Drink was going to start small (Houston,
Minneapolis, and Chicago) before adding more cities.
For
the first time in awhile, I thought "these guys might
actually make it". For one, they were starting small,
focusing their advertising in just a few cities in
order to build the databases of people in those cities.
Second, if a person cancelled, their membership,
they would be refunded for any days not used!
Now,
several months later, Let's
Grab a Drink is starting to make a name
for itself and here's how:
1)
They network with other local companies (radio,
newspaper, hotels, restaurants, etc.) to offer
local singles events. At these events, they sign
up members.
2) They offer prizes to members, with the current
one being a 7 day trip to Clearwater Beach, Florida.
Having a profile on the service automatically enters
you into the contest.
3) They do radio campaigns (one of the current ones
is called "Date and Win") in which they give out
prizes to site members (certificates, concerts, dinners,
etc.)
4) They do local TV and radio advertisements. Remember,
since they are in only three cities (which is soon
to change), they can do more to build local membership
bases before expanding and applying the same techniques
to new cities.
5) They offer a refund policy and there's no red tape
you have to go through. It's a one-click cancellation
process and you are refunded for any remaining time
on your membership.
Folks, Let's
Grab a Drink is becoming a case study
for how to do things the right way. The company even
plans on donating a portion of its earnings to
various charities (something Romantic
Planet also
does) once the company becomes more profitable.
I
cannot say enough good things about this new online
dating service. They are putting the consumer first
(easy cancellation, prizes, refunds, etc.) and removing
the headaches from the billing/customer service side
of the online dating process.
When
you put consumers first, they will put you first. And you know what?
It's working. Next week, Let's
Grab a Drink will be
expanding to California, New York, Colorado, and Florida.
If
you are serious about starting an online dating service,
this column is the most important one you'll ever
read. It shows that your mindset is a key part of
whether your service will succeed. Stop making it
about "what can I do to get more money from the consumer"
and make it about "what can I do to improve the consumer
experience?"
Remember:
1)
Put the consumer first. I'm sure you've
been upset at the way a company has treated you
in the past. Strive to make it so that no one is
ever that upset with you. Remember the golden rule,
"do unto others as you would have them do unto
you."
2)
Find ways to heavily differentiate yourself (in
a good way) from mainstream online dating services
(i.e. offer refunds).
3)
Network with other businesses to create joint ventures
that benefit everyone involved.
4)
Offer incentives for people who become members
(paying or not). Note: My free ebook "Maximizing
Your Online Dating Success" can be used as an incentive.
I offer a co-branded version to online dating services
that are already open and don't contain adult-content.
Email me with the URL of your service and a request
for the eBook and I'll co-brand it and give it to
you free to offer your users when they sign up.
5)
Don't start too big. One reason Let's
Grab a Drink is succeeding is because they only focused on three
cities to start. It allows you to focus your marketing
dollars.
6)
Remember that you need to market from several different
angles and markets. Just doing online advertising
won't cut it.
7)
Find ways to create press releases that will attract
attention. All it takes is for one news organization
to write a story on you and that one story could
result in many more. I was once quoted by the New
York Post and that article led to several TV appearances
and radio interviews on the same subject. If you
have the money, hire a good public relations firm
to help.
8)
Be serious. Running a successful online dating
service isn't something you do "just on the side".
There's a lot of issues to work out, especially if
you become successful - servers, technicians, customer
support reps, etc.
Starting an online dating service isn't something
you do after purchasing a template on eBay. It's something
you do after you've created a business plan, marketing
plan, networking plan, and have established a winning
team with new ideas that keep the focus on customer
satisfaction. Do a great job and I may be writing about
you here.
...
Cheers and Jeers
Welcome to Cheers and Jeers where every month I highlight
something a person, company, or service is doing in
the dating world and give it a thumbs up or a thumbs
down. This week...
Jeers:
LavaLife
A few months ago, LavaLife (a service I generally like)
started phasing out its Credits program (you buy credits
then use those credits to communicate with others)
in favor of monthly subscriptions. Operating on credits
(where you use X amount of credits per communication)
was one of the things that made LavaLife unique. Now
they are becoming like any other service and the result
is showing.
Before
LavaLife went
to a monthly subscription plan, I would never receive
SPAM messages. Now that paying members can communicate
with whoever they want, I have seen SPAM messages
from fake LavaLife members
skyrocket. LavaLife has
created a problem where there wasn't one before
and in the process removed their Unique Selling
Proposition.
Note: If
you know something an online dating service is doing
right, please
let me know. We are going to
be highlighting more of the positives of specific services,
providing them with free publicity as a result of their
desire to be more consumer friendly.
Joe Tracy is
publisher of Online Dating Magazine and is often quoted
by the media in relation to online dating topics. His Inside
the Online Dating Industry column is published once a month.
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