The churn argument overlooks the fact that there's a lot of repeat business. I know plenty of people who have been using one or more of these services literally for years. IAC seems to have figured out something the other investors have not, which is how to capture that segment of the market and keep them coming back. It seems to have something in common with slot machines and other casino and freemium games: you have to give people enough wins to keep them playing but not enough that they actually get what they want.
Really interesting analysis. I always wondered if the general quality of online relationships is less than those formed elsewhere. I mean, if you found your partner on a dating site I wonder if you are more likely to break up because you know there is a whole pool of singles just waiting to message. If you don't have a buffet of potential partners to choose from you may be happier?? I am reminded of Dan Gilbert's research - seems it may apply.
I know that online dating was a horrible experience for me. I felt I was becoming way too picky and judgemental trying to pick people to go on dates with. I also knew I couldn't judge chemistry and compatibility through someone's profile so the whole thing was pretty frustrating. I ended up meeting the person I married totally randomly one day when I wasn't looking.
Obviously I am not saying all relationships that were formed online are terrible or anything - I'm talking generally.
