Business Strategy Hub

How Does Tinder Make Money?

Company: Tinder
CEO: Sean Rad
Year founded: 2012
Headquarter: Dallas, US
Number of Employees (Dec 2018): 200
Parent Company: Interactive Corp (IAC)
Type: Private
Valuation (March 2019): $10 billion
Annual Revenue (Dec 2018): $800 Million

Products & Services: Tinder Online | Tinder Gold | Tinder Plus
Competitors: Happn | Hater Dater | Raya | Bumble | Hinge | The League | Coffee Meets Bagel | Zoosk | OkCupid | POF | Grindr | Match.com

Fun FactAs of Dec 2019, Tinder has over 4.3 million paid subscribers worldwide.


Introduction

Tinder is a location-based dating app. It was launched as a mode to remove the social and physical hindrances between people. The app focused on connecting people across the world.

What makes Tinder unique from other such similar social apps?

Swipe Right, Match, Date.

Yes, it’s that simple! It’s a new age dating app for millennials. Tinder reached over 50 million users in just a couple of years because of its popularity among millennials.

The app connects you to the people who are complete strangers. Not the people whom you already know or in your connection. As Tinder has one of the unique business models, it won the Crunchie award of TechCrunch’s Best New Startup of 2013.

Creating a profile on Tinder is a normal process as users can log in through their Facebook profile. All the user information that exists there, for example, pictures, personal information, interests, work details, and any other info will be exported on to the user’s Tinder profile. All the profiles created on Tinder play a vital role in the Tinder Revenue Model.

Very few people know that Tinder is owned by InterActiveCorp (IAC). IAC is a huge internet and media company (headquartered in New York) that owns over 100 well-known brands around the world.

You might have heard of Handy, Angie’s List, ask.com, dictionary.com, CollegeHumor, Vimeo, Investopedia, Match.com, OkCupid, Twoo, PlentyOfFish, these are some of the brands which the company IAC owns.

How Does Tinder Make Money?

How Does Tinder Make Money?
How Does Tinder Make Money?

Now let’s understand the Tinder business model and more importantly, how Tinder makes money?

 

1. Free-mium Service

Tinder gained its popularity by providing a free app to its users by utilizing a freemium business model.

In today’s, Technology dominated world, businesses provide free apps in the hope to have rapid adoption and gain a huge customer base, which is exactly what happened in case of Tinder.

Within a few years of its launch, Tinder became very famous very fast! Now, Tinder has added all kinds of paid services in their apps.

  • Tinder Basic provides free access to all its users. However, it gives a limited number of swipes in the 24 hours.

 

2. Paid (Premium Service)

After gaining a substantial customer base, Tinder has been adding some additional paid features. When it started the paid service of Tinder Plus. For the people who are okay with basic features, Tinder basic is for them.

For better and more advanced features, there’s Tinder Plus and Tinder Gold. These two new paid services are the ones through which Tinder makes money.

 

  • Tinder Plus

It was launched in early 2015, some of the special features which can be available for Tinder Plus users are mentioned in the table below.  

When it comes to the costing, Tinder Plus uses a subscription model, and its monthly fee varies according to the age of a user ($9.99 to $19.99) in the US.

    • If a user’s age is below 28 years – $9.99 per month
    • If a user’s age is above 28 years – $ 19.99 per month

 

  • Tinder Gold

 Tinder Gold was launched in late summer of 2017. Tinder Gold differs from Tinder Plus because of its unique characteristic that is new members only feature. With an exclusive paid service in Tinder Gold, the user can experience all the plus features as well as the new Likes You feature.

The new feature is useful in terms of finding out the number of likes the person received. It displays a grid format in which the person can see who liked them even before they swipe, and the person can return the like back. Waste no time in swiping as this feature allows checking the person’s profile or dismiss it. There’s an additional feature of gold heart logo.

The cost for Tinder Gold also varies with ages, locations, time of service. It ranges from $14.99 to $82.99.

  • Super Like

 As of June of 2018, a new feature in which you can like somebody with a swipe up or give somebody a blue star. Free users get 1 super like a day whereas all paid users get 5 super likes a day. Users can also buy super likes in a package of 5 or 25 at an additional cost of $4.99 – $19.99.

  • Boost

A new Boost feature is added to the paid versions in the Tinder app. This feature surges the chances of a match by getting more profile views through the user’s profile boost. The users can purchase this additional feature at $1.99 to $3.99 per boost.

  • Sponsored Profiles

Tinder has also partnered with various corporations, campaigns, and events to exhibit sponsored content by creating their profiles.

By swiping right on a sponsored profile, the person can get matched automatically and receives a message from the sponsor, just like we see on websites these days. It is up to the user if he/she wants to engage with the profile or converse with them. This feature starts at $9.00.

  • Swipe Life

Through, its lifestyle website, Tinder is also planning to generate video content. As of now, the monetization method of video content is not very clear, according to company sources. However, we can assume that it could be used for paid advertising.

Tinder services and its monthly and Al a carta pricing
Data source: Lifehacker.com | Tinder services with its monthly and Al a carta pricing

In Conclusion

As of March 2019, the brand valuation of Tinder is estimated at $10 billion. It looks like the current Tinder business Model is thriving and is absolutely productive. This is because of the new dating trends prevailing around the world. With such exciting and advanced features provided by the app, people are willing to pay for it and create their network of friends or relationships. 

Tell us what you think? Did you find this article interesting?                                                   
Share your thoughts and experiences in the comments section below.

Brianna Parker

She is a creative writer, corporate storyteller and global brand consultant, who has a unique combination of a business and creative mindset.

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