[November 17, 2004] Dow Jones Market Monitor By Riva Richmond Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)–Yahoo Inc. wants to find someone to love the real you.
On Wednesday, the Internet giant plans to launch a new, pricier class of its popular online dating service that it says will help singles better understand who they are, how they love and who they should let into their hearts.
The new service for “relationship seekers,” dubbed Yahoo Personals Premier, lets people search for soul mates based on the results of online personality and relationship tests. Although the tests are available free to all comers, searching for compatible people requires Premier membership, which costs $34.95 a month, compared to $19.95 a month for a standard membership.
The interactive tests, which were designed by relationship experts, are designed to assess a dater’s personality type, “love style” and relationship skills. On top of giving people insight into themselves, test results advise daters about what sorts of people they would be happiest with – and which are more likely to bring strife and hurt.
“It’s like free therapy,” says Lorna Borenstein, a former eBay Inc. executive who is now vice president and general manager of Yahoo Personals, of the 10-minute personality test and 30-minute relationship test. “It tells you who’s more likely to be right for you, as opposed to your perception of who’s right for you.”
So a woman with an “idealist” personality and “romantic” love style, for instance, will learn that men who are “creators” and have a “passionate” love style are their best bet. Men who seek “spontaneous” or “careful” love are probably people to avoid. With a Premier membership, she can search for men whose tests revealed the right qualities, as well as meet standard search criteria like location, height, education level and religion.
Yahoo says the capability will more efficiently yield the higher-quality prospects that relationship seekers want from online dating services. “How do you find your needle in the haystack?” Borenstein asks. “Technology can make it easier.”
And these singles, which account for about 27% of online daters, are willing to pay more money than casual daters if given better tools for their search, she says.
The higher-priced offering comes at a time when growth in spending on online dating is slowing. Personals remain the largest paid online-content category in the U.S., excluding pornography and gambling, with U.S. consumers spending $227.9 million in the first half of 2004, according to the Online Publishers Association. Although spending in the period was up 6.4% from the first half of 2003, it has declined sequentially for three quarters in a marked reversal from two and a half years of rapid growth.
Yahoo won’t disclose how much of its revenue comes from personals, though it has said the service is one of four that together account for 70% of its paid-service revenue. The other three are Internet-access, e-mail and small-business services. Yahoo operates the No. 1 personals site with 6.2 million users in October, according to research firm comScore Networks Inc.
Borenstein said technology and product innovation at Yahoo Personals has boosted activity on the site in the past. Of course, the company won’t be the first to provide personality and relationship testing. EHarmony, for one, has built a sizable community by offering to connect more serious-minded daters based on compatibility testing. Match.com also offers personality testing. But Yahoo says it has taken the concept further.
Now that personals growth appears to be leveling off and companies are looking to spark a second wave of growth, “the name of the game changes a bit to things like innovation, differentiation, satisfaction and the like,” says analyst Dan Hess, a comScore senior vice president. “To the degree (Yahoo’s offering is) new and different, or more successful, it offers a way to differentiate.”
Yahoo says its tests are the most up-to-date in terms of scientific understanding of what makes good relationships and the most fun to take. The tests ask users to react to hypothetical situations, rather than a list of questions with multiple-choice answers.
Yahoo also says it applies the most advanced search technology to the task of matching compatibility information with real people.
Prospective dates who have also taken the tests will also be rated on their personality and relationship “fit” with the searcher and given a one-to-five heart rating on their “overall fit.” Yahoo’s “SmartFit” search technology also accepts feedback from users about whether recommended people are actually compatible and learns from it to provide better search results the next time.