Last Updated Apr 28, 2010 1:21 PM EDT
The letter isn't long -- not long, that is, aside from a bullet-pointed list of 18 stats from Plentyoffish's marketing materials, which Match.com challenges its competitor to substantiate. The list includes claims that Plentyoffish generates over 500,000 new relationships and 18 million dates each year, and 20,000 new signups daily. "Based on my knowledge of the industry," writes Match general counsel Marshall Dye, "these claims cannot be supported and are misleading and/or false."
These sorts of letters are probably fairly common; what's uncommon is seeing them shared. But Plentyoffish founder Markus Frind not only posted the letter, he also answered it with a blog post going into his own suspicions of exaggeration by Match. (The ellipses are my own):
This letter is beyond ironic considering match's history of bogus claims, like this one from last week. Match claims that 42% of dates from dating sites are as result of match.com and 30% of marriages are a result of match.com What they fail to point out is that match has been around for 15 years and most of the sites listed in the survey barely existed 5 years ago...Match has good reason to go after Plentyoffish. While Match is a paid site, Plentyoffish is free, and is probably larger in the United States than Match, presenting a serious challenge to its business. The situation is analogous to the threat Craigslist poses to eBay -- each free company makes less money than its competitor, but arguably does a better job of catering to consumers.
If we actually look at what match.com claims it gets into the absurd. Last year they claimed 12 marriages per day. Eharmony claims 236 marriages per day Now a year later match.com claims double the number of marriages as eharmony in this survey around 472 marriages per day or 994 people getting married per day... On match.com you can't talk to a user if you don't pay. So does anyone actually believe that every day 944 out of 3000 new paying users of match.com will get married eventually because of who they met on match.com? Do 1 in 3 paying subscribers of match.com even go out on a date???
As Frind points out, Match attempted to compete by opening a site last year called DowntoEarth.com, but failed to find any growth (just as eBayClassifieds.com flopped). So Match now appears to have moved on to Plan B: threatening legal action.
The problem is that, as Frind's flippant posting shows, it's not likely to get terribly far. And the free sites are making a serious case that there's no need for Match or other paid dating sites. A few weeks back OKCupid, another free site, posted its own lengthy, stats-heavy attack on Match and eHarmony:
Yes, only 1/30th of the "20 million users" they [eHarmony] advertise is someone you can actually talk to. That's the paradox: the more they pump up their membership totals to convince you to sign up, the worse they look...In its entirety, the OkCupid post manages to simultaneously amuse, inform, and depress (when you think about the sheer number of people paying to find love on Match or eHarmony); I recommend taking a look at the whole thing. Luckily for the pay sites, OkCupid is a far less threatening rival than Plentyoffish, which is many times larger.
As you can see from the flow chart, the only way they don't make money is to show subscribers to other subscribers. It's the worst thing they can do for their business, because there's no potential for new profit growth there. Remember: the average account length is just six months, and people join for big blocks of time at once, so getting a new customer on board is better for them than eking another month or two out of a current subscriber...
Okay, Match is double counting to get "12 couples", since a couple that gets married also gets engaged. So we have 6 couples per day getting married on the site, or 4,380 people a year. Let's round up to 5,000, to keep things simple. My first observation is that Match.com made $342,600,000 last year5. That's $137,000 in user fees per marriage...
It turns out you are 12.4 times more likely to get married this year if you don't subscribe to Match.com.
But at the end of the day, Match isn't at serious risk of being overcome in the near future by Plentyoffish, or any other free site. Match has existed for well over a decade, and even its competitors admit that it continues to attract subscribers.
As always in the technology the world, the biggest risk may lie in a place that nobody is watching. My own guess: the blind spot for all of the above dating sites is Facebook. Not only is Facebook free, but it comes without the stigma that online dating sites still carry, and it is already a vehicle for plenty of successful romantic hook-ups.
For the moment, Facebook looks like a non-rival; the few dating companies that have tried to start on Facebook have by and large failed. For their part, the major dating sites have ignored Facebook. That's a mistake, though -- the social factor is important, as well as the casual dynamic on Facebook. And there's at least one dating site proving that it can leverage Facebook: Zoosk.com, which has a prominent Facebook application and, as you can see from the Compete graph below, has suddenly begun to grow very quickly.