This document is authorized for use only by KYLE MATTICE in MGT 509 Spring 2015-1 taught by Keith Yurgosky, University of Scranton from March 2015 to August 2015.

This document is authorized for use only by KYLE MATTICE in MGT 509 Spring 2015-1 taught by Keith Yurgosky, University of Scranton from March 2015 to August 2015.
For the exclusive use of K. MATTICE, 2015.
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eHarmony
approximately $250 million on 1.2 million paying customers, with equal membership from men and
women. Most of the membership growth had come from overseas, accounting for 30% of the firm’s
revenues. To boost US growth, Match invested in new features that made Match more similar to
eHarmony. For example, it started to offer dating advice from a doctor, Dr. Phil McGraw, a popular
daytime TV personality who had gained celebrity status following his appearances on The Oprah
Winfrey Show. Match featured Dr. Phil prominently on its website, advertising his “Mind, Find, Bind”
method for finding “enduring romance,” while carefully avoiding references to marriage. The
campaign did not boost the membership base, as the number of paying customers had increased only
to 1.3 million despite the company’s presence in 7 new countries. 43 Unsurprisingly, by early 2007 Dr.
Phil had faded into the background, while Match focused on its campaigns of “It’s OK to look” and
“Find someone special in 6 months, or we’ll give you the next 6 months free,” designed to attract new
members who would hopefully convert to paying customers.
However, despite the slow growth, margins were predicted to remain at 20%–22% on projected
revenues of $349 million and an asset base of $333 million.44 Maintaining margins would be a major
achievement for the company, as it has just increased its advertising spend from $80 million to an
estimated $145 million, matching eHarmony’s advertising spend as a percentage of sales.45 Among
other online personals companies, only Match had any kind of TV presence to rival eHarmony. Given
the fact that Match’s website traffic in 2007 was only 20% of 2004 levels, many expected the
company’s advertising expenditures to increase in the future.
In early 2006, Match also launched a new brand, called Chemistry to challenge eHarmony in the
serious relationship segment. “At some point Match realized that was a lot of money to be made in
the serious relationship market. Those consumers are often much more willing to pay for
memberships,” recalled a Marketing team member. Chemistry shared many similarities with
eHarmony, with a few important points of difference. Like eHarmony, Chemistry required that
prospective members fill out a questionnaire before joining the site (see Exhibit 12). However, unlike
eHarmony, Chemistry sold memberships to anyone who wished to sign-up, giving them a major and
minor personality designation, from the menu of Explorer, Builder, Director, and Negotiator.
Chemistry was also similar to eHarmony in that it delivered a pre-set number of matches to its
members using an algorithm developed by another doctor—Dr. Helen Fisher, a visiting research
professor of anthropology at Rutgers, and author of four major books and numerous publications.
Unlike eHarmony, Chemistry claimed that its algorithm focused on interpersonal chemistry rather
than psychosocial compatibility. To appraise such attraction, Chemistry asked its members to
compare the length of their ring finger to the pointing finger of their right hand—a characteristic
apparently determined by the amount of testosterone present in the womb during fetal development.
This, in turn, was thought to determine certain personality characteristics. Chemistry applied for
patents, claiming a system to determine early-stage attraction between prospective mates.
Finally, like eHarmony, Chemistry required that members go through a three step guided
communication process. The first step required that both people rank criteria, such as neatness,
feelings on family life, sense of humor, and pets and send their answers to their match. The second
step entailed sending two questions for the match to answer. Chemistry provided questions asking
about proudest moments, greatest regrets, and lessons learned from previous relationships, but
members could also write in their own questions. If the matched members decided to pursue their
relationship further, they could proceed to email contact. Chemistry did not offer the equivalent of
eHarmony’s Fast Track. However, it did allow people to come back to the site and report how their
offline dates went. This feedback was reportedly used to deliver better matches.
In its first year of operation, Chemistry spent $10 million on advertising and claimed 2 million
registered users, even as some users reported a fairly low “successful first meeting” rate.46 In 2007