- May 22, 2021
- Posted by: Stratford Team
- Category: Tech
The largest dating apps in the U.S. are banding together in support of Covid-19 vaccines, in the hopes that it’ll be a hot vax summer.
For the uninitiated, hot vax summer plays on the idea that once single Americans get their coronavirus vaccines, there will be a surge in dating, hookups and overall social opportunities due to all the pent-up demand. (You may also know it as shot girl summer.)
Match Group’s Hinge, Tinder, OKCupid, BLK, Chispa, Match and Plenty of Fish users will be able to share their vaccine status and get some premium benefits. Bumble and Badoo will also be able to note whether they’re vaccinated, and receive some complementary credits.
Bumble‘s and Match Group’s latest earnings reports already indicated what all of the social media anecdotes are saying — people want to hook up again. Though, Match executives put it another way in its letter to shareholders, calling this the “summer of love.”
In its earnings release, Match said it anticipates total revenue of $680 million to $690 million in the second quarter. That would represent 22% to 24% year-over-year growth. Additionally, the company expects EBITDA of $255 million to $260 million this next quarter.
“The vaccination rates and control over the Covid cases these last few months have resulted in our users feeling more confident about their dating lives,” Match CEO Shar Dubey said in a call with investors.
Bumble estimates total revenue in the range of $175 million to $178 million for the second quarter, up 31% year-over-year at the midpoint of the range. That’s also slightly better than analysts surveyed by Refinitiv expected, though some analysts considered it overly cautious. It also anticipates full year revenue in the range of $724 million to $734 million, raising its guidance.
Bumble CEO Whitney Wolfe Herd told investors the company was seeing “meaningful pent-up demand as economic and health improvements approve across regions.”
‘Growing momentum with reopening’
“We got a kick out of hot vax summer,” Grindr’s Director of Marketing Alex Black told CNBC. “Activity is definitely up and we definitely expect that to increase going into the summer.”
It’s not that people didn’t use dating apps while isolating at home this past year. Despite the pandemic keeping people from in-person meetups, dating apps saw a jump in usage during lockdowns. Dating companies were able to shift their businesses to put an emphasis on virtual dating during the pandemic, so people could fill up their evenings with Zoom dates and phone calls.
It seemed to pay off.
Bumble’s first quarter revenue increased year-over-year to $170.7 million, up from $79.1 million for the first quarter of 2020. Analysts were expecting $164.6 million. Total paying users also increased 30% to 2.8 million.
For its first quarter, Match reported adjusted earnings per share of 57 cents on revenue of $668 million. Analysts expected 40 adjusted EPS of 40 cents on revenue of $651 million. Average subscribers increased 12% to 11.1 million, up from 9.9 million in the prior year quarter.
Daily average swipes were up 24%, daily average messages gained 19%, and conversations were 32% longer compared to the baseline period before Covid, Match said. Hinge is on pace to double its revenue in 2021.
“Stronger than expected 1Q21 results show growing momentum with reopening,” Truist Securities analysts wrote in a recent note on dating apps.
A reacceleration of the economy and a willingness to meet up with strangers again will likely push companies’ growth even further, Jordana Abraham, co-host of the popular dating podcast “U Up?” told CNBC.
Now that more than 270 million vaccine doses have been administered in the U.S., the people who took breaks from dating over the pandemic (tired of endless swiping or remote dating) are ready to get back out there. Often, an app is behind meet ups.
“People have felt this fear of being in physical contact with people, this fear of going out and meeting anyone new,” Abraham said. “And as people across the country start to get vaccinated, there’s like something in the air. It’s the sense of hopefulness, in the sense of, you know, the idea that they’re going to be able to get back to that physical intimacy which so many people have been craving.”
Bumble told investors that it was already seeing signs of increased engagement in the U.S. People who had opted out of the app during the pandemic are starting to come back, and people who stayed are engaging even more.
“Of course people who took a break are definitely coming back,” Grindr’s Black said. The company is seeing growth among new users and a return of those who are logging back in for the first time in a while.
Kathryn, a 27-year-old from Chicago, said she’s been on-and-off of Hinge and Bumble since the pandemic restricted nearly all of the ways to meet people in person. (As she put it: “at bars, at work, Uber Pools, the wine section of Target, etc.”). Now that she’s vaccinated, she’s comfortable going on more dates that aren’t virtual and is looking for casual relationships.
“I’m not looking to immediately reenter the world and settle into a serious relationship,” Kathryn told CNBC in an email, asking that her last name not be used so she could speak freely about her dating life. “I don’t know if that’s the common sentiment though. A lot of people may have realized after all this time alone at home that they’d like someone stable to be there if and when something like this happens again.”
It’s a similar story for Jordan, a 24-year-old from Boston. She’s been using Hinge and Bumble, and had been seeking out a serious relationship before the pandemic. However, after spending a year living alone and becoming fully vaccinated, she said she’s leaning more toward casual relationships, wanting to meet more people.
Most places also still haven’t returned to normal, so people are relying on apps to continue meeting people.
“Since my area is still re-opening, it feels like I’m in limbo, where I can go places but can’t necessarily go to the types of events/activities where I usually meet people (ex. bars, concerts) or COVID restrictions limit socialization at the places I can go (ex. local outdoor events, museums, gym),” she said in an email.
Bumble’s Wolfe Herd told CNBC’s “TechCheck” that as people come out of the pandemic, they’ve realized what they’re looking for.
Grindr is ramping up its marketing and advertising spend in anticipation of a return to normal. The company is also planning a handful of in-person events for later in the summer, going off of local health guidelines. Bumble may also boost its marketing spend, depending on pandemic recovery.
Of course, it all depends on whether pandemic conditions continue to improve. The Centers for Disease Control and Prevention said fully vaccinated people no longer need to wear a face mask or stay six feet away from others in most settings, whether outdoors or indoors, which is a huge vote of confidence for singles.
A safe hot vax summer
People don’t want to just be protected against the coronavirus. A similar story has been playing out with U.S. condom sales this past quarter. Male condom sales dipped over the year, since fewer people were having sex, but now that restrictions are easing and people are vaccinated, sales are back up.
Sales jumped 23.4% to $37 million during the four weeks ending April 18 compared year-over-year, according to the latest figures from market research firm IRI and reported by CNN.
Trojan condom-maker Church & Dwight said 2021 could be “promising” for sales. Condoms are expected to deliver year-over-year growth as society opens up and consumers have greater mobility, the company’s CEO Matthew Farrell said on an April 29 call with investors.
Durex-maker Reckitt Benckiser said in its April 28 earnings report the segment delivered double-digit revenue growth in the quarter, led by strong growth in China due to an easing of social distancing restrictions.
“Looser ‘stay at home’ restrictions in China, compared to the first quarter of 2020, have for example, helped drive strong growth in our sexual wellbeing category. Over time, we would expect this recovery to be replicated in other markets where lockdowns have led to temporarily reduced demand,” the company said.