Motley Fool analyst Rich Duprey has posted a piece on Nasdaq.com expressing doubts about Match Group stock.
The piece, entitled “Is Match Becoming Un-Hinged With Its Latest Acquisition?” argues that buying more dating apps might not lead to growth.
One reason for this is the ‘paradox of choice’. The paradox asserts that more options can sometimes lead people to avoid making a choice, always thinking a better option is the next one along (the concept, ironically, is often applied to the experience of using Tinder itself).
Users may hop between dating apps, not knowing which is best, and avoid staying in one place for long enough to add significant value.
Because of this, Match Group may have done better to adapt one of its own millennial dating sites and orient it towards long term relationships than acquire another brand.
Match may also be buying users that already use its services, and simply adding complexity to its operations without much potential for additional growth.
The article notes: “Match has acquired dozens of services over the past nine years and in the past three years spent $610 million acquiring different brands, about equal to its cumulative operating earnings for the same period.”
Hinge has previously branded itself in a way that was heavily critical of Tinder, so ending or re-purposing those adverts will be one benefit for Match.
Read more here.