Online Personals Watch: News on the Dating Industry and Business

Parship CEO, Dr Arndt Roller - OPW Interview

OPW INTERVIEW -- Sep 30, 2006 -- Parship is Western Europe’s ‘eHarmony.’ It’s the leading internet dating site focused on long term relationships and currently operates in 10 Western European countries. Parship started out in Germany, Austria, Switzerland, Belgium and the Netherlands and more recently extended into Italy, France, Spain, and now into the UK in 2005 and Sweden in January 2006.  Here’s my interview with CEO, Dr Arndt Roller. - Mark Brooks

What is Parship’s founding story?
Parship.com was founded in 2001 by two managers of holtzbrinck networxs, the venture capital arm of Verlagsgruppe Holtzbrinck, a very quality minded publishing house (they own e.g. Macmillan Publishing) publish “Nature”) with roots in Germany. Holtzbrinck demanded a quality minded approach to the online dating classifieds. When they looked at the market they saw a lot of services that were oriented towards flirting. That’s when they met Professor Schmale, the scientific mastermind behind the Parship concept, and we started our service. From day one, Parship was oriented towards long term relationships. Parship is based on a mandatory, scientific matchmaking process, plus integration of personal preferences. We do things very different from the industry norm. For example, you won’t see “picture galleries”, not even pictures on profile pages until the time that the other person allows exactly that to happen.. This might look very odd when you look at the entire industry where pictures are everything.

Who are your competitors?
In the premium or long-term segment, Parship enjoys a very dominant market share. Havng said that, across Europe there are about 10 copies of the Parship service from small players. Some of them are former employees of Parship that have just set up their own service. But they have shown limited growth. One is a service called, Elite Partner, which was started by a former Parship marketing manager, and one is called be2, launched by a former Managing Director of Parship, who had to leave after very short time in the job. They all try to look very similar to Parship and are basically imitations.

How do you market Parship?
Many online dating companies seem to rely on keyword advertising predominately. For us, we’ve traditionally always worked very heavily with quality-newspapers and -magazine brands. Parship is integrated into their online-sites. We have 190 different corporate partners across Europe. Parship has a very good reputation in the B2B community, it´s been been built over 5 years and that helps us now as we approach more and more potential partners. In addition to that, we have significantly increased our brand marketing.

How did the UK launch go for you?
The UK market is probably the most expensive to enter, together with the German market. The big advantage we have is that we’re basically competition free in the long term relationships segment in the UK market. From what I can see, eHarmony has little impact in the UK and Europe. 

Could you give a couple of examples of how the UK and German markets are different from each other?
There are many elements. One obvious area of difference is the different use of payment methods. In the UK there’s a significant amount of people using credit cards. In Germany there’s much lower credit card usage. In many European countries credit cards are either not accepted in general or they might be accepted but not over the Internet. Second, the big media portals behave in very different ways. So, striking deals with them can be difficult and expensive. 

How does Parship pricing vary across Europe?
It depends on market pricing sensitivities. Price points vary as the result of our marketing experiences in each market. The same goes for many of our European competitors. In Germany we have membership choices, based on monthly pricing;, a 3 month membership costs 120 Euros, 40 Euros a month. A 6 month membership, which most of our subscribers use, costs 179 Euros, 29 Euros per month.  The 12 month costs 263 Euros, 22 Euros per month.

What advice would you give to the CEO’s of U.S. corporations interested in entering the European dating market?
Spend a lot of time in Europe first and don’t look at Europe as one market or as one big country. I mean, most Americans I’ve met apart from those that have lived in Europe for a long time can’t help but look at Europe as one country.  As long as you have that mindset, don’t go to Europe.

From what I’ve heard about China and India that is also not ‘one’ country. The same with the U.S.A. actually. New York is not ‘just like’ San Francisco. Baltimore is not Little Rock, Arkansas. I’ve got tremendous respect for people entering the U.S.market from the outside because I think that’s a very, very difficult thing to do successfully. The same applies for companies from the US or Asia trying to enter Europe with its 10 -15 relevant local country markets.

When we look back at the last 10 years, there must be a reason that so many American online companies that decided to enter the European market have failed.

So what would you say would be the biggest market investment that you learned in the last couple of years with Parship?
Quality might take a little longer but will definitely reap much bigger rewards than a quick and dirty approach that many people follow. That’s a lesson across Europe. 

What do you mean by quick and dirty?
Going into a market not really caring about the quality. For example, taking money from day one. Not looking after user complaints. That kind of approach is what I mean. That sometimes seems to work for some of our competitors but we’ve learned that e.g. waiting longer before asking people to pay and investing more time before you launch a service pays off.

Does Parship’s matchmaking profiling really work?
Yes, definitely. And we are continuously improving the matchmaking process. For the first half of 2006, 38% of our subscribers tell us they left the service because they found the love of their life. Cynics tell us that with such strong success rate we might destroy our future market chances. That´s of course completely wrong. Such success leads to a very high customer satisfaction level, which is important in many industries but is absolutely the most important key metric in our business, since it builds trust, confidence and positive word-of-mouth. As long as a user is really looking for a long-term relationship, in Europe, Parship is the best way to find the right partner. If they are looking for casual date we are just not right.

How fast will Parship grow over the coming year and what are your goals?
We will grow between 50% and 70% over the coming year, faster than market growth and despite increasing competition.

First of all, internationalization is an ongoing process for us. Launching a country doesn’t mean there is no further work to do. So, developing and growing all our Western European services is our goal. Then there’s a commitment from all of us at Parship that we will focus only on long term relationships. Like I said, we have no interest whatsoever in going into flirting and dating. We’ll leave that to the experts in that field. That leaves us with some interesting opportunities around the quality and premium approach.  We are currently working on new business developments that we’ll talk about once they’re launched. I don’t want to talk about things we haven’t really done yet.

Are there any countries outside of Europe that you have your eye on?
Yes.

USA, per chance?
First and foremost, we consider ourselves a European company, with roots in Germany.. We are the number one premium service in Europe. To maintain that and benefit from the fantastic growth opportunities will keep us very busy. But if there is an interesting and compelling opportunity outside of Europe, we will definitely go for it.

CyWorld => Wallop

MARKET WATCH  -- Sep 28 -- On CyWorld, the Korean social network, about $125 million is spent annually on stuff to decorate the CyWorld communities. In the virtual-game market, about $900 million is spent by players sprucing up their virtual environment; castles, bigger castles, castles with moats. Consumers spent $2 billion in ringtones back in 2001. Today, about $7.4 billion is spent on personalized ringtones around the world. So, Wallop is a neat idea, with a lot of potential. FULL ARTICLE @ MARKETWATCH.COM

What Parents Need to Know About MySpace

US NEWS - Sep 18 - COVER STORY -- MySpace seems like Lake Wobegon gone horribly wrong: a place where all the women are fast, the men are hard-drinking, and the children take an above-average interest in imitating them. In August MySpace accounted for 81% of visitors to leading social-networking sites (Hitwise).  Facebook came in second with 7%. Parents should ask to see their kids profiles and make sure photos aren't overtly suggestive. Text should not signal that your child is emotionally vulnerable; i.e. "I'm feeling lonely." Purdue University found that a third of employers screen job candidates on search engines, while 11% look at social networking sites. MySpace Unraveled is a new book on safety.  BlogSafety - forums.  GetNetWise.org - snooping software. NetSmartz.org - safety videos. WiredSafety.org - advice.

Mark Brooks: MySpace allows users to keep their profiles private these days. However, photos of your 19 year old partying a little too hard could still make their way permanently onto the web to embarrass them later in life with a potential employer.

Expanding OPW's Daily Reading List

OPW -- Sep 29 -- Besides monitoring mainstream news services we're also scanning the following blogs each day for news items starting today: Apophenia, Digg, Many-to-Many, Mashable, Micro Persuasion, Mobile Crunch, Online Dating Insider, Ross Mayfields's Weblog, Scobleizer, Silicon Beat, Startup Review, TechCrunch, Techmeme, The Blogging Times, The Dating Weblog, The Internet Dating Guide, The Paradigm Shift, The Social Networking Weblog, Valleywag, Web Publishing Blog. Phew!  Are there any more you'd like me to add to the list? Does anyone know of a way to do a daily keyword search (i.e. 'dating') from a defined list of blogs? - Mark Brooks

SexSearch Affiliate Promotion: Island Gathering

PRESS RELEASE -- Sep 28 -- SexSearch has the very LAST room (Oct 12th-16th) available for the Island Gathering (150 attendees, $1900 each).  Affiliates get one chance to win for every SexSearch user sign up today through Sunday!  SexSearch is sponsoring this event complete with ATV island tour, sailing, luxury dinner, a poker tournament. SexSearch has grown to over 10 million registered members and signs up 15,000 members a day; growing primarily through affiliate marketing. New affiliates that sign up get a $100 bonus, just for signing up!

Mark Brooks: SexSearch is super aggressive with affiliate marketing and is now the #2 player in the casual dating space. I'd call it a niche, but it's hardly a niche these days, it's so huge. 

Dr Phil: Internet Love Scammers

OPW -- Sep 28 -- Victims shell out $100,000 every single day to scammers who put up nice pictures on dating sites, sweet talk singles and then say they need money, e.g. they're on business and are stuck in Nigeria.  Scamming is an international crisis with most scams coming from Nigeria.  There's a saying in Nigeria.  "You blame the person for leaving the rice available to steal."  A lot of the scammers are graduates but don't have a job to go to.  70% of Nigerians live on less than a dollar a day in Nigeria. 

Scammers pocket $300 million a year from British victims.  Not too long ago a senior UK politician was a victim; $15k stolen from his bank account. 

VICTIM: Deedee accumulated a $928 phone bill...but 'Cole' (the scammer) said he'd pay it when he returned to the USA.  He needed a $2300 ticket home to the USA.  Deedee has sent him $3700 so far.  She totally believes 'Cole' is in love with her and thinks he lives in Buffalo, NY.  Dr Phil located the man.  He's a lottery scammer in Nigeria; people send money to get money back.  She never noticed that he had a West African accent.  The man in the picture is Michael, a model (and police officer) who's picture was taken from focushawaii.com.   

The next guest is pretty sure she's being scammed but is in love and can't give him up.  The scammer says he's English and his father is African.  Hence the accent.  He asked her for money a month after  they started talking.  He'd gone on a contracting job and was beaten and robbed and needed money for hospital.  Then he asked for $750 for an airplane ticket, then $200 more for additional anti-terrerist fees. "I don't know, love does strange things to you I guess."  Noone was at the airport.  Five days after she went to the aiport the scammer's 'doctor' called.  He was in a coma after being hit by a car and woke up calling her name.  The doctor needed money for his bills.  After leaving the hospital he wanted $25k for a farm.  She kept on sending him money.  9 times out of the 14 times he asked in the ensuing 4 months.  To this day, she wishes he would show up at her door.  She's STILL chatting with him on the internet!  In reality, the picture is of a UK model. 

Dr Phil estimates internet scammers take $15 billion a year. "All those people who are bullying and victimising innocent people.  We're gonna turn a big floodlight on over their heads, on this show, this year."   

Mark Brooks - Dr Phil mentioned Yahoo and Yahoo chat on the show.  No mention of Match.  After the show at 7pm PST Dr Phil was on the Match.com website on a live chat to take questions.  Alas, I logged in at 7:30pm and the chat session was over. 

Internet dating sites have three lines of defence again scammers. 1. Automated filters that look for words and behavioral patterns that indicate the presence of a scammer. 2. User flagging.  Users can flag profiles of people that they suspect are up to no good. 3. Customer service/abuse teams review profiles, photos and user flaggings. 

Socializr Revealed

VESTED VENTURES -- Sep 13 -- On September 7 Gamma users gained access to Socializr. Socializr.com is a "free web service for sharing event and party information with your friends. Use Socializr to plan the ultimate social life!" It's a very clean and simple design with friends list, comments on friends/events, event invites w/RSVPs, photo posting/sharing for users and events, and forums. Organizations can have their own webpage for posting events. There is a link to "IM this event." I'm not too impressed as of now. I would have thought that $1.5 million in 2 rounds of funding and many months of development would have produced something better. It's Evite with social networking. Hopefully there's much more functionality that's going to differentiate this business better than the only interesting piece of this business, which is the the founder had previously created Friendster. Competitors: Evite, Upcoming.org (purchased by Yahoo), Renkoo, Skobee, Mollyguard, Eventful, Zvents, Google Calendars.  

Mark Brooks: I worked with Jonathan in 2003.  Markslist.com (my domain) was the events center on Friendster for a while and we run a series of events called 'Friendster Exposed which pulled 300 attendees at a time.  He always had an interest in Evite-esque functionality. Jonathan moved from Silicon Valley to San Francisco and has been partying it up since he cashed out and left Friendster. He's more plugged in to the hipster network and should be able to do a great job seeding another social network. 

Yahoo Acquires Video Editing Company, Jumpcut

VENTURE BEAT -- Sep 28 -- Jumpcut's video editing tools are based on Adobe's "flash" technology. It's a fully-featured video editor, which sits in the browser. Jumpcut also host videos. FULL ARTICLE @ VENTURE BEAT

Mark Brooks: Online personals users are buying webcams. Cameras are all video enabled these days.  It's time to enable video uploads on profiles. Videos don't lie.

Mobile Dating Sucks

THE PARADIGM SHIFT -- Sep 28 -- At the European iDate lots of companies where trying to sell mobile dating, but every owner I talked to said they thought mobile dating was a joke and would never amount to much. The basic problem is that there is no such thing as mobile dating. Sure you can put up profiles and make it look like a dating site but no one actually uses it. People who use "mobile dating" are mostly under the age of 24 and are looking to chat with others. Mobile dating as it stands today is nothing more then a chat line, and most of the  mobile "dating" users don't even have computers. Online daters are age 30 to 40 and looking for longer messages and serious conversations. Mobile daters are mostly looking to kill time and to chat for entertainment. When trying to create a mobile dating site your existing brand is meaningless, the only thing that matters is being on deck at a carrier as it is the only way to get users. It is strange that all these mobile companies are pitching mobile dating as an extension of online dating. They all know full well and admit in private that "mobile dating" and online dating are completely different markets with different demographics that don't overlap. FULL ARTICLE @ THE PARADIGM SHIFT

Mark Brooks: Markus cuts to the chase once more. That's the situation right now. The moneymakers are flirty chat applications, but that's because the mobile dating apps suck and are below critical mass. But, it's going to change. Mobile dating will eventually overtake internet dating. Why?  Because mobile computing will eventually overtake fixed computer (PC/laptop) usage. Laptops will morph into palmtops and be unified with cell phones and mp3 players (time to invest in Apple ;-) ). I'm talking ten years out, but I see this as inevitable. Keyboardless voice activated sexy (a la Apple) palmtops will make mobile computing more compelling. Location based services and video dating will make mobile dating more compelling. A couple of mobile enabler services are working on video dating right now. Your comments please.

Craig Newmark - Craigslist Not For Sale

REUTERS -- Sep 28 -- Craig is not interested in selling out despite MySpace $15 billion valuation. Craig was running his site (back when it was an e-mail list of local events) during the dot-com blowup. He saw stupid companies get stupid money and lose it. Keeping Craigslist a real $20-30 million company is much more satisfying than making it a fake $15 billion one. FULL ARTCLE @ VALLEYWAG

Mark Brooks: Craig is nothing but consistent. Many people have approached him since the site's inception and his answer has always been the same. eBay owns 25% of Craigslist only because one of the founding employees sold their share. I own Markslist.com btw.  One day I'll do something useful with it. Any ideas? At one stage it was the social events calendar for Friendster. Now Jonathan (Friendster founder) has started Socializr as a social events social network.

MySpace Worth $15 Billion?

CNN MONEY -- Sep 28 -- A Wall Street analyst assesses MySpace could be worth $15 billion in the next three years. MySpace video ads currently run $35 CPM, which would bring in plenty if the vast majority of MySpace pages viewed had video ads and not 50c CPM "swat the mosquito" banner ads. FULL ARTICLE @ VALLEYWAG

Mark Brooks: YouTube and FaceBook are looking at $1 billion+ valuations right now so it's not too hard to extrapolate MySpace valuation out a few years at the $10 billion+ range assuming consistent growth rates. Crazy days. No wonder everyone and their uncle are starting social networks. (btw, flash based, next generation social network Mooble is for sale for a song. Email me at mark@courtlandbrooks.com if interested).

Comscore's Canadian Internet Dating Rankings

OPW -- Sep 28 -- The Canadian internet dating rankings are now in. Both Lavalife and PlentyofFish edge out further against their competition. Canoe ReseauContact and Mate1 move one spot to #3 and #4 as Spark reduces it's traffic and relegates to the #5 spot.  NETCLUB.FR and Yahoo Personals move up one spot in a similar fashion. LoveHappens reduces it's traffic and relegates itself down from #6 to #9. Match grows a little stronger and moves up into 10th spot. 

Mobile Dating Sucks

THE PARADIGM SHIFT -- Sep 28 -- At the European iDate lots of companies where trying to sell mobile dating, but every owner I talked to said they thought mobile dating was a joke and would never amount to much. The basic problem is that there is no such thing as mobile dating. Sure you can put up profiles and make it look like a dating site but no one actually uses it. People who use "mobile dating" are mostly under the age of 24 and are looking to chat with others. Mobile dating as it stands today is nothing more then a chat line, and most of the  mobile "dating" users don't even have computers. Online daters are age 30 to 40 and looking for longer messages and serious conversations. Mobile daters are mostly looking to kill time and to chat for entertainment. When trying to create a mobile dating site your existing brand is meaningless, the only thing that matters is being on deck at a carrier as it is the only way to get users. It is strange that all these mobile companies are pitching mobile dating as an extension of online dating. They all know full well and admit in private that "mobile dating" and online dating are completely different markets with different demographics that don't overlap. FULL ARTICLE @ THE PARADIGM SHIFT

Mark Brooks: Markus cuts to the chase once more. That's the situation right now. The moneymakers are flirty chat applications, but that's because the mobile dating apps suck and are below critical mass. But, it's going to change. Mobile dating will eventually overtake internet dating. Why?  Because mobile computing will eventually overtake fixed computer (PC/laptop) usage. Laptops will morph into palmtops and be unified with cell phones and mp3 players (time to invest in Apple ;-) ). I'm talking ten years out, but I see this as inevitable. Keyboardless voice activated sexy (a la Apple) palmtops will make mobile computing more compelling. Location based services and video dating will make mobile dating more compelling. A couple of mobile enabler services are working on video dating right now. Your comments please.

Will Microsoft's Spin-off Pack a Wallop?

BUSINESS WEEK -- Sep 27 -- Wallop was unveiled Sept. 26. It was spun off from Microsoft a year ago and has been in the works a full four years. Wallop looks more like a desktop than a Web page, and it's entirely based on Flash. Instead of listing friends, the site has a radar-like graphic that plots your connections based on how frequently you interact with a person. Wallop doesn't make money by selling ads. It collects small payments for clever, animated applications called "mods." For a fee of, say, 10 cents, you can get a cartoon of an angry bunny created by an independent Flash designer to jump around your page. The key isn't simply amassing users, but getting "cool" people to come to Wallop.  Everyone will want to be where the cool people are. The site is invitation-only now, and each person only gets a few invites to dole out. Wallop will be doing some grassroots promotions in cities including Los Angeles and New York to woo trendsetters. FULL ARTICLE @ BUSINESS WEEK

Mark Brooks: Brilliant! They were wise to ditch the Microsoft pedigree. It wouldn't quite work for viral activation amongst the student population. (Microsoft is still kinda evil, compared with the likes of do good Google). South Korea's Cyworld has made a mint of graphical charms and mods. Will this concept convert to a Western audience. I think so. I worked on all-flash Mooble earlier this year. They are looking for more money to execute the plan I laid out. Namely, chase down Facebook. (Email trevorcoyne@ireland.com if interested)

Facebook's For Everyone

CNET NEWS -- Sep 27 -- As the site considers a hefty buyout by Yahoo and eyes new competitors in the college space, this week it joins the likes of Friendster and MySpace in losing the exclusivity that fed its popularity. FULL ARTICLE @ CNET NEWS

Mark Brooks: I'm on Facebook now. Feel free to link up. Facebook has surely been eyeing MySpace's userbase for a long while. This is the next logical (short term sell the company) step for them. They need to continue showing exponential growth rates for the buyout. Makes sense, but undermines their integrity/focus/branding. They have to stay ahead technologically now, or they WILL lose their student base to other sites as they seek out the next great underground superhip next generation social network. Students will use more than one network, and might eventually shift their loyalty and focus if a site opens up and is significantly technologically ahead of Facebook.

Check Mate

NY POST  -- Sep 27 -- "The guys that women meet on dating sites, at least 50 percent of the time they are lying," says New York private investigator Skipp Porteous. Sherlock Investigations offers a comprehensive check for $500. Intelius just started a major scare-tactic ad campaign which includes one TV commercial where a woman is blissfully unaware she is about to go on a date with a violent sex offender. If only she knew, the ad seems to say, she could buy a $50 criminal background check online. Dating guru Liz H. Kelly, author of Smart Man Hunting, advises using a secondary e-mail address, never giving out more than a cellphone number and always meeting in a public place. When Truedater users were polled recently, the #1 gripe cited about online daters was with lying about physical appearance, #2 was marital status and #3 was age. FULL ARTICLE @ NYPOST

Piczo European push

NETIMPERATIVE -- Sep 27 -- Piczo’s traffic has grown 393% in one year (comScore Mediametrix) and now boasts 4 million unique visitors in the UK, reaching 60% of the young teen demographic in the UK.

Mark Brooks: I don't see Piczo in the press much, but they have done a great job of targetting too-young-for-MySpace users.

Web Publishers Question Accuracy of Metrics Firms

MARKETING VOX -- Sep 26 -- The Interactive Advertising Bureau is pressuring the third-party metrics firms to improve the accuracy of traffic data reports. Major websites such as MSNBC.com claim the traffic data it collects varies by as much as 30% from the data reported by metric firms. Several top publishers are reporting that the gap is widening between internal traffic data and Nielsen//NetRatings and comScore Media Metrix data. These complaints are intensifying just as both firms prepare to undergo long-awaited Media Rating Council-led audits. Some favor a combination of third-party and self-reporting from sites, with which Nielsen is already experimenting. FULL ARTICLE @ MARKETING VOX

Mark Brooks: In 2003 I compared FriendFinder September 2003 uniques as reported by comScore and Nielsen//NetRatings. They were nearly an order of magnitude apart. The numbers and panel sizes have improved very significantly. Hopefully Nielsen's parity checking system will help. So, which internet dating sites will step up to the mark and share their internal numbers first? It would be great to report more accurate industry numbers. Fyi, I list Nielsen//Netratings, comScore Mediamatrix and Hitwise online personals site rankings in the left bar each month (by special courtesy).

Cingular and YouTube Promote Battle of the Bands

MARKETING VOX -- Sep 25 -- Cingular has teamed up with YouTube for an online promotion allowing independent musicians to submit videos that the YouTube community can then vote for. The four winning bands will appear on Good Morning America and receive airtime on Sirius. FULL ARTICLE @ MARKETING VOX

Mark Brooks: This is a marketing and PR double whammy.  Great idea.

Dr Phil Covering Dating Scams on Tomorrows Show

OPW -- Sep 27 -- Set your Tivo. This could be interesting. Dr Phil is covering 'love scams' tomorrow (Thursday). "Dee-Dee thinks her online boyfriend will repay the money he owes and marry her when he returns from Nigeria. And, Annette is "in love with the idea" of her Internet flame, but does he actually exist?" Find the channel and time.