The dating economy disrupted
For better or worse, the world of dating has been transformed by technology over the last decade.
While desktop dating apps such as RSVP and Ok Cupid dominated the early part of this relationship revolution, as smart phones gained ubiquity across the globe they have fallen out of favour.
In their place, the likes of Match Group Inc (parent company of Tinder) and Bumble Inc have taken the reins. These were and are app-first companies, fresh, fun upstarts completely committed to challenging and changing the way people interacted – be it romantic or platonic.
That mission has led to the wild success for both platforms – with Tinder (arguably Match’s most valuable asset) and Bumble both growing incredibly quickly in recent times.
It should be noted that while we have full visibility on Match’s FY20 performance, Bumble has yet to finalise its 2020 figures, reporting data only up until the September quarter. Despite that, below we compare and contrast some of the key statistics from both companies.
From a market share perspective, Tinder remains the dominant force in the online dating world, especially in the US. According to data covering 2020, in the US Tinder controlled 40% of the market, Bumble 19% and Hinge (another subsidiary of Match) 6%.
Mind you, while Tinder has almost double the market share of Bumble, Bumble is growing significantly faster. In 2017, Bumble had just a 10% market share of the US dating market, while Tinder’s market share stood at 43%. This means that not only is Bumble growing faster, but Tinder is actually losing market share.
This may have been one of the reasons which CNBC’s Jim Kramer described Bumble as a better option for growth investors. As Mr Kramer said recently:
‘If you’re a growth-oriented investor, Bumble’s the way to go,’ while adding that ‘If you’ve got a more cautious approach to the market and you still want an online dating stock, Match is the way to go.’
While Match doesn’t break down user metrics per app – though it does tout the fact that Tinder is the world’s most downloaded dating app and grossing app worldwide – we can use other sources to gleam insight into its user data.
For example, according to BusinessOfApps, in an article published in January, on a global scale, Tinder had 55 million users while Bumble only had 20 million. In the US the gap between those metrics tighten, with it being reported that Tinder has 7.8 million US users compared to Bumble’s 5.0 million.
Bumble itself provided more colour to those statistics in its IPO prospectus, revealing it had 2.4 million paying users – across the first nine months of fiscal 2020; and 42 million monthly active users across the September 2020 quarter.
Despite a pandemic, 2020 was a strong year for both companies, with Match (Tinder) and Bumble reporting impressive top-line growth.
Bumble, for example, reported revenues of $416,577,000 for the period between January 1 to September 30 2020. By comparison, for the nine months ending September 30, 2019, Bumble reported revenues of $362,639,000.
As such, while we have incomplete 2020 data for Bumble, the first nine months of data potentially exhibits a positive trend which investors will likely be keen to see continue when the company reports its full-year results.
By comparison, Tinder – for the full-year in 2020 – brought in revenues of $1.4 billion, representing a year-over-year increase of 18%. This points to somewhat slower growth than the year prior, where Tinder’s revenues were growing at 43% year-on-year. Despite slower growth, Tinder continues to be Match’s arguably most important platform, making up more than half of the Group’s total FY20 revenue.
Match Group stock VS Bumble share price performance
With incredibly little historical share price data out on Bumble given its recent listing, fair share price performance comparisons are incredibly difficult. Despite that, Bumble has traded somewhat lower since publicly listing, though is up around 66% from its IPO issue price of $43 a share. A win for insiders, at the very least.
Like the investor enthusiasm around Bumble, the Match Group share price has been a strong performer over the last year, rising 129% in that period.
How to trade dating stocks
Where do you stand? Are you bullish or bearish on stocks in the online dating space? Whatever your view, you can trade the likes of Match Group (Tinder) and Bumble – long or short – using IG’s world-class trading platform now.
For example, to buy (long) or sell (short) Bumble using CFDs, follow these easy steps:
- Create an IG Trading Account or log in to your existing account
- Enter ‘Bumble Inc’ in the search bar and select it
- Choose your position size
- Click on ‘buy’ or ‘sell’ in the deal ticket
- Confirm the trade