A recent report by Topeka Capital Markets finds that the combination of tough economic times, a rise in the number of singles, social media and mobile technology is causing a resurgence in the "fast food dating" business of online personals. people are a lot more comfortable posting their personal information online.
So there's no longer a negative stigma attached to online dating," said the report's author, Victor Anthony, Topeka's managing director of Internet media. In a recent Pew Internet survey, 59 percent of Americans said they consider online dating a good way to meet people compared with 44 percent in 2005. are single, meaning there's plenty of opportunity for dating sites.
Other research suggests that more than a third of married couples now meet online. The unmarried population stands at 47 percent, up from 42 percent in 1994, according to the Census Bureau.
But even though the industry as a whole is growing, not all online personals sites are created equal, and analysts say only a select few make for good investments. Others focus on niche markets like race, religion and ethnicity.
Sites like e Harmony—the second largest online dating website in the U. "There are few stand-out investment opportunities these days," said Mark Brooks, an Internet dating industry consultant based in New York City.
Leading the pack is Match.com, owned by IAC/Inter Active Corp, the Internet holding company controlled by billionaire Barry Diller.
Analysts say is best positioned to capitalize on the surge, so much so that Topeka has increased the value of the company's stock to $98 from $78 and recommends investors purchase shares of IAC in anticipation of a spinoff.
"In general, I would recommend mobile and social and large dating sites. "The dating phase prior to an offline marriage runs up a $23,660 tab.
The average dating site customer spends just 9 a year for online memberships, which more than pays for itself to the tune of ,803 in cost savings from fewer dates," the report said.Mobile technology is another driver of industry growth.The monetization of romance in the form of dating apps has allowed users to take their online dating experience with them wherever they go.(IAC announced in December that the dating website will be reorganized as a separate business called Match Group, with its own chairman, potentially setting the stage for a spinoff.) "A company like Match, they have the best potential to gain significant market share in terms of the number of subscribers," Anthony said.If it happens, the move will make it easier to turn Match into a separately traded company, a strategy Diller used before.IAC previously spun off travel service Expedia in 2005.