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Business logic behind paying for dating site leads (9)

01-30-2013 04:55 PM #1 wiggywack (Member)
Business logic behind paying for dating site leads

So someone creates a dating site and then reaches out to an affiliate network to get people to sign up for the site. The pay the affiliate network $x/lead and then the affiliate network takes a percentage of that and passes the rest along to the affiliate for each lead they send.

My question is, what's the business case for the dating site owner to pay $7, $8, $9 per lead or more? In most cases, the site is free to join, correct? Are they charging for extras?

Or is it simply an advertising play? Dating sites ask lots of questions about your interests and personality, as well as your demographic and geographic data. This data is valuable for advertisers and they'll pay a premium to be able to access it.

But if they're after the advertising dollars, why don't we hear more about affiliates advertising on dating sites? Plenty of Fish is the only dating site I hear doing this. Or are these other sites monetizing through display ad networks?

01-30-2013 05:00 PM #2 andyscraven (Member)

Quote Originally Posted by wiggywack View Post
So someone creates a dating site and then reaches out to an affiliate network to get people to sign up for the site. The pay the affiliate network $x/lead and then the affiliate network takes a percentage of that and passes the rest along to the affiliate for each lead they send.

My question is, what's the business case for the dating site owner to pay $7, $8, $9 per lead or more? In most cases, the site is free to join, correct? Are they charging for extras?

Or is it simply an advertising play? Dating sites ask lots of questions about your interests and personality, as well as your demographic and geographic data. This data is valuable for advertisers and they'll pay a premium to be able to access it.

But if they're after the advertising dollars, why don't we hear more about affiliates advertising on dating sites? Plenty of Fish is the only dating site I hear doing this. Or are these other sites monetizing through display ad networks?
Most sites only have limited FREE stuff to get you interested. So you can usually search at will or you may be able to send a message but not read the reply! Or not send messages at all until you upgrade!

01-30-2013 07:48 PM #3 butthole (Member)

the reason you see affiliates advertising on POF is because POF is actually fully free. They make their money from the ads.

01-31-2013 12:09 AM #4 dr_ngo ()

You should sign up for a few dating sites yourself and see how they monetize. Basically there's usually a "premium" membership upsell, and that's where dating sites make money from on the backend.

If an affiliate sends too many leads that don't turn into sales, they'll usually get a lower payout or even get kicked off the offer.

01-31-2013 12:34 AM #5 panthary (Member)

I've always wondered what ROI the dating websites are receiving from the leads, fascinates me they would pay so much for a free sign up.

Quote Originally Posted by butthole View Post
the reason you see affiliates advertising on POF is because POF is actually fully free. They make their money from the ads.
POF has free accounts & paid subscriptions

01-31-2013 10:18 AM #6 Finch (Moderator)

Quote Originally Posted by panthary View Post
I've always wondered what ROI the dating websites are receiving from the leads, fascinates me they would pay so much for a free sign up.
I think we can safely say that they'll only pay us what they can afford to. If there's any spare margin, the merchant takes first dibs. We are the last mouths to feed!

I think there's definitely room for a rival to POF. Dating sites are an advertiser's goldmine for their targeting options alone. Where else are you going to entice the user to reveal so much about his life and what he's actively looking for?

01-31-2013 10:49 AM #7 Animal Manager (Member)

Also consider, monetizing those leads through membership or even getting anywhere near profitability from their members may not be the primary motivation for those sites. A lot of times they are just looking to show significant & consistent growth so that they can be sold on once they hit a critical mass.

http://www.onlinepersonalswatch.com/...-by-zoosk.html

01-31-2013 03:12 PM #8 xerocool (Member)

If a company can convert well on your leads, paying $3-4-$5 is no issue if the advertiser is charging a nice amount. If leads back out, they back out. If they don't, then you'll face issues. simple.

01-31-2013 03:21 PM #9 matthewk (Member)

Its similar logic to zip submits, they monetize hard and do full analytics on the entire funnel from click to life time value, if your free signups don't back out to profit you will get pulled from the offer.

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