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Why Match.com Is Taking Part of Its Business Off-Line With 'The Stir'

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In time for Valentine's Day, a look at the business of encouraging face-to-face meetings among online daters.

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It's a Wednesday evening at an upscale rooftop lounge in midtown Manhattan. Under gold and black tapestries that hang from the ceiling, several men are standing alone, staring at flatscreen televisions, while a few pairs of women sip cocktails, pretending to be deep in conversation.

Thirty-year-old Jen S., whose name has been changed to protect her identity, is fiddling with her phone while occasionally looking up at the crowded room.

"I just texted my friend and told her it's like a junior high dance with really expensive drinks," she said. "But it seems to be getting better as people are getting drunker."

In May, Match.com launched "The Stir" -- a program of local dating events that bring together Match members for activities like cooking classes, bowling nights, and happy hours. The company, owned by Internet giant InterActive Corporation (NASDAQ:IACI), wants to attract new members who might not otherwise try online dating.

At stake is the growth of Match, which is IAC's second most profitable division, bringing in about 24% of fourth-quarter revenue from 2.8 million paid subscribers, according to the most recent quarterly report. The Stir could help Match grab a larger share of the 102 million singles in the US

"We believe if we can get more people face to face through our singles events, we're going to have much more success and get more people to try Match.com," Mandy Ginsberg, CEO of Match.com, told Investors Business Daily in June.

Match members who pay for the service (many don't, making do with the limited number of free features) get an invitation to a Stir event, and they are allowed to bring up to five people as guests. People who commit three or six months have a better chance of receiving a Stir invitation. The Stir's invitees are selected based on where they live and their age. Monthly memberships range from about $21 to $42, depending on how long one commits to using the service.

"I came tonight to support my friend," says Christian H., 26, who adds that he has an "in-the-works" girlfriend, but if it doesn't work out, he would consider paying for Match.com and attending the events. "It's better than hitting the next or search button," he said. "At least when you come to this bar, you already know the deal. You know what people are here for."

In January, Match threw more than 400 events in 80 different cities, from Los Angeles and New York to Honolulu and Anchorage. In 2012, the company held more than 1,600 events with more than 150,000 attendees, according to Match spokesperson Amy Canaday. She added that 85% of members said they had a good time and would go to the event again.

Match.com launched in 1995, making it one of the first dating websites in history. The website and its 560,000 active users were eventually sold to IAC for $43.3 million in 1999, according to the company's 2000 annual report. Since then, Match.com has more than quadrupled the number of paid subscribers and has added 30 other dating brands, like OkCupid and Chemistry, to its Match division. OkCupid has also launched events.

From year-end 2007 to year-end 2012, the Match division grew its revenue more than 100% to $713.4 million, and increased its paid subscriber numbers by more than 100% to 2.8 million.

Mark Brooks, an online dating consultant based in Europe who covers global businesses, says there's no question that Match has to do events.

"Where else can they grow?"

He adds, "There's really two distinct kinds of singles: those that go out to meet people, and those that like to idate."

By not having events, Match misses out on those people who want to get out from behind a computer and meet someone in person, he said.

But events have had a history of failure at Match. Over the last decade, Match has tried to operate singles events and build speed dating businesses only to realize it wasn't worth the company's time and money. Match first tried to offer singles events in 2002 with its launch of MatchLive.com. Later in 2003, it launched SpeedMatching.com. Today, both URLs redirect to Match.com.
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