## Why You Should Never Pay For Online Dating

Saturday, October 30th, 2010

The OkTrends data-miners, who usually analyze free-dating-site OkCupid’s own data, make the admittedly self-serving argument that you should never pay for online dating, based on the for-pay sites’ own data:

1. We’ll start with their yearly revenue: \$250M in 2009 as reported by the industry analysts at Piper Jaffray and CNBC2.
2. Since eHarmony charges users by the month, we’ll divide that big number by 12 and, rounding up, get \$21M.
3. Now all we need to know is how much the average user pays per month. If we divide that into the \$21M they make, we know how many subscribers they have. Their rates run this gamut:

\$19.95 per month, for a 12-month subscription
\$29.95 per month, for a 6-month subscription
\$59.95 per month, for 1 month at a time

From those numbers, we can see that they have somewhere between about 350,000 and 1,050,000 subscribers (the lower number supposes everyone is month-to-month, the higher supposes everyone is yearly).

4. What’s the exact number? Well, I found this helpful nugget in eHarmony’s advertising materials3: On average, eHarmony obtains 12-15k new users every day and sees full audience turnover every 6.5 months.
5. The most charitable way to interpret this last sentence is to assume their average account life is 6.5 months.
6. We’re almost there. To get eHarmony’s total subscribers, we divide their \$21 million in revenue by the average subscription price. Therefore maximizing total subscribers is just a question of minimizing the average monthly fee. First off, let’s do them the favor of assuming no one pays month-to-month.
7. Our remaining dilemma can be expressed mathematically like this: We want to minimize monthly revenue (29.95x + 19.95y) while making sure the average account life works out to 6.5 (6.5x + 12y = 6.5) where x is the [share] of users on the 12-month plan, and y is the [share] of users on the 6-month plan.
8. After some dickery with a legal pad we discover, in the best case for eHarmony, 1/13 of their users are on the yearly plan, and the rest subscribe 6 months at a time. Thus the minimum average monthly fee is \$29.18. They have at most 719,652 subscribers.
9. For the sake of argument, let’s round that up to an even 750,000.

So, having given eHarmony the benefit of the doubt at every turn, let’s look at where that leaves their site: 750,000 subscribers / 20,000,000 profiles ? 96.25% of profiles are dead.

Yes, only 1/30th of the “20 million users” they advertise is someone you can actually talk to. That’s the paradox: the more they pump up their membership totals to convince you to sign up, the worse they look.