Online dating giant Match Group is unhappy with one of its leading brands, Tinder, so it’s putting its earlier plans to have the service adopt cryptocurrencies and venture into metaverse-based dating on hold.
In a recently released letter to the group’s shareholders, Bernard Kim, CEO of Match Group, showed a cautious approach toward integrating the company’s services with metaverse despite earlier bullish announcements and its last year’s acquisition of social networking company Hyperconnect for an estimated USD 1.73bn.
The CEO said a metaverse dating experience is important to capture the next generation of users, but added that,
“However, given uncertainty about the ultimate contours of the metaverse and what will or won’t work, as well as the more challenging operating environment, I’ve instructed the Hyperconnect team to iterate but not invest heavily in metaverse at this time.”
At the same time, Kim said that Match Group will “continue to evaluate this space carefully,” and that it will consider moving forward at “the appropriate time when we have more clarity on the overall opportunity and feel we have a service that is well-positioned to succeed.”
All this comes as Kim shared his disappointment with Tinder’s results in the second quarter of 2022 and the service’s stalled growth. While Tinder’s direct revenue expanded by 13% year-over-year, Kim admitted that, over the reported period, Match Group “has not been able to realize the monetization successes that we typically deliver.”
“Tinder’s current revenue growth expectations for the second half of the year are below our original expectations as a result of disappointing execution on several optimizations and new product initiatives,” the CEO said.
Kim’s letter also demonstrates a cautious approach toward launching dedicated tokens for its prime service, stating that, following the “mixed results” from testing Tinder Coins, the company decided to ”take a step back and re-examine that initiative so that it can more effectively contribute to Tinder’s revenue.”
”We also intend to do more thinking about virtual goods to ensure that they can be a real driver for Tinder’s next leg of growth and help us unlock the untapped power users on the platform,” he said.
Meanwhile, Renate Nyborg, CEO of Tinder, is leaving the company. Hers is one of several management changes at Tinder announced by Match Group. Kim will take up that role until a new permanent CEO is found.