Online Personals Watch: News on the Dating Industry and Business

Service Spotlight: Interview With Neil Steinhardt, GM Of PaysafeCard

OPW INTERVIEW - Nov 15 - Facebook uses prepaid cards. Cupid.com as well. Why? Because people’s credit is shaky these days, there’s a sizable unbanked market, and some people just plain don’t want to use their credit card for a dating site. I discovered PaysafeCard at the last iDate. Here’s my interview with the GM of PaysafeCard. (PaysafeCard are a client of Courtland Brooks)

Who are your top customers?
Cupid.com and Facebook.

How do prepaid cards work?
The PaysafeCard works like a lot of pre-paid cards. We issue a card with 16 digit pin code which are sold at retail for cash and redeemed online. It works just like cash on the Internet. We don’t charge any fees, we don’t register customers.

So how does it work for Facebook for example?
If you were to buy Facebook credits you would go to the checkout screen and you would see a bunch of payment options such as Visa or Mastercard and you would also see the PaysafeCard. You would then click on the PaysafeCard and see a couple of options. If you’re new to Paysafe you can type in your zip code and it will give you a list of the closest locations where you can use the card.  If you already have a PaysafeCard then you enter your 16 digit pin code.

Where do they get the cards from?
PaysafeCards are available in 28 countries - Europe, US, Mexico, Argentina.  There are 350,000 points of retail such as Paypoint in the UK and 7/11 in the US. We work with top shelf distribution partners in every country we are in and we make sure our PaysafeCard vouchers are convenient and local.

What’s your commission?
Prices have come down as is always the case with market pressure. The reality is that the PaysafeCard processing is higher than credit card processing, typically between 10-15%, but we are a lot less expensive than mobile payments for example. All payments are guaranteed with no chargebacks so it’s less book keeping and accounting. Just like paying by cash on the Internet.

What are the best practices that you would recommend for the Internet dating industry? How should prepaid cards in general be applied?
You need to look at your payment mix. Lots of payment options are out there. If you’re only after credit card customers and repeat billing then you are only swimming in a small section of the pool. There a plenty people who have reservations about recurring billings or sharing personal information online. You need to have multiple payment options, not too many that you scare the customer away but an adequate amount to give the customer the ability to pay.  We think having a cash option, which we are, really does attract a large segment of customer base. We have seen 10-30% increase in sales just by offering a cash option.

We have you listed in our payment processors spreadsheet that we issue.  You can find that on OnlinePersonalsWatch on the left hand bar. In a nutshell how would you describe PaysafeCard as being distinguished from other prepaid card providers?
We have a couple of differentiating factors. First, we don’t charge any fees so if you want a $10 PaysafeCard then it will cost you $10 and when you redeem it you get $10 of value. Secondly, we don’t register customers. We are not an e-wallet so the customers who want to retain privacy and not share personal banking information can do so with us.

Service Spotlight: Interview with John Maitland, CEO of PhotoVerified

OPW - Oct 18 - Internet dating users don’t like showing up at dates to find they’re meeting someone they don’t recognize. The industry can do better to help users not have these nasty surprises. John’s helping with that cause. - Mark Brooks

You verify photos, how do you do that?
We have a patent pending system to combat the problem that it is easy to create fake personas online. PhotoVerified makes sure that photos are recent and authenticated by your system. Unlike other processes who have tried a similar thing ours involves a human element. Technical [solutions] help with filtering but every photo is looked at by one of our verifiers.

Where are your people based? You must have a low cost base in order to have real people. Are they offshore?
Our main base is currently in Toronto but we are looking at offshore data centers.

How do you make sure that the photos are really of the people who are on the service?
When you sign up our system generates a unique code for you to display in the photo you are going to send to us. We ask people to write their code down on a piece of paper using a black marker then we ask them to crumple up the paper and flatten it back out again.  It is a lot harder to Photoshop a code into a crumpled piece of paper. This photo then goes to our verification system. Verifier doesn’t know the code. All they are seeing is a photo of a person and a code. They type in the code or reject outright for reasons such as person covering face. Assuming everything is good, verifier types in code and clicks accept.  If code is incorrect and the system doesn’t recognize it then it escalates to another verifier. The first person could have just made a typo. Second verifier doesn’t know someone already saw this photo so if the next verifier types in correct code then its fine. If the code is bad again then it’s escalated to a manager who can see more info, possibly it’s just sloppy hand writing.

I love the crumpled up paper part, is that the part that’s patented?  What part of the process have you locked down?
We don’t have a patent issued yet, it’s still pending but it is part of the patent as well as other technical details that allow us to filter out signs of potential manipulation. Other thing is that we use a timer so it limits the ability to manipulate.

What’s your service cost?
Less than if you were trying to do this in house.

Service Spotlight: Interview with Nick Tsinonis, CEO, Intro Analytics

OPW INTERVIEW - Oct 11 - This is a new strand of interviews called Service Spotlights for companies that serve the dating industry.  We're pleased to start off with the CEO of Intro Analytics, Nick Tsinonis. - Mark Brooks

What does Intro Analytics do?
It’s a data intelligence matching company designed for dating sites and social media. We look at the behavior people have online and we match them based on that.

Back in 2004 when I was working with Cupid.com, I had the opportunity to visit Professor Dan Ariely. The key takeaway I had from that meeting was that peoples behaviors give you a better indication of who they are and what they are looking for. That’s why I’ve been keen to speak to you.

Who’s the brains of Intro Analytics and what’s your founding story?
The brains are myself and Gavin Potter. I started a website in 2006 called YesNoMayB. I was going to revolutionize the online dating industry by matching and analyzing your taste without you having to do much. I realized that it was really hard to have the science to match people like that. So I approached Gavin. He had his own techniques for data analysis as he came from a mathematical and psychology background and he also had strong computer science. Within 24 hours he astonished me with what he did with my data. He said ignore NO’s and just concentrate on the YES and MAYBE’s.

Why ignore the NO’s?
He said there’s a lot of noise in the NO’s. He said think more about signals. A clear signal would be a match so get rid of dirty signals. We launched Intro Analytics at iDate ’09.   It’s great to have the science/data crunching. To turn that into a product is easy. But for a customer to send you data needs a lot of operation and product management.

A lot of data for you to choose from. What data do you prefer? What do you draw from primarily to establish behaviors you want to match?
We look at implicit data, which is behavior.  We are looking at what a person is clicking on and who he is messaging to. We look at the instances of that event and when it happened. Some are stronger signals than others i.e. a message is stronger than a view but even a view is important. When you look at all the views of a person you can personalize the site for those users in a 1-1 way, create a completely different window. People can branch off into area they want to.

One thing I’ve heard consistently is the computer power needed to do this kind of matchmaking is pretty intense. Do you provide computing power?
Yes, it’s part of our magic. Computing has become a lot more powerful but if you know how to utilize hardware for processing data then we can speed it up 100 times more than a database. We don’t use databases, this would take us days to crunch. 

Does this happen daily?  Do your client’s give you the data feed daily and then you crunch?
Yes, it could happen hourly if you want.  But in terms of being able to do a crunch it has to be done in a batch. We need to go back at least 6 months. 

You say that you help Internet dating companies make 30 % more money. How?
Amazon says that 35% of its sales come from recommendations, why?  Every single page of content on Amazon has a section just for recommendations for you. We look at usual activity, we can show you more of what you like, keep your attention for longer, and convert higher. People need to trust that you have a real science doing real things.

You have a wonderful vantage point in the online dating industry. You can observe a lot of behaviors’ from users. What would you say is the most counter intuitive behavior that you have observed?
We’ve noticed that users 50+ are a lot more loyal, stick around longer. We can actually create stories from looking at data. If someone wants us to look at something specific such as: When people go to bed? We can say that males stay up later whereas females are usually logged off by 2am beauty sleep.

Who’s using Intro Analytics in the dating industry at this stage?
Our biggest clients are GlobalPersonals.co.uk and WhiteLabelDating.com. We are also working with some free sites such as Smooch.com. 

Let’s talk about money. Let’s say I have a dating site with 100,000 paying members and several hundred thousand registrants at any one time. But the paywall is set up so that only the 100,000 subscribers are getting the matches. How much is that going to cost me to use Intro Analytics?
That’s a pretty decent sized site. The ideal price is $3,000 - $10,000 range. We try to squeeze as much analysis as we can into the service. We can offer in-house servers just for you so you can take some of the cost and for smaller clients that can save you about 20%.