Sunday, February 9, 2020

How online dating is changing the way single people spend their money 


This evolution is having an economic impact 'because it's driving consumer spending, it's driving household formation'.


Online dating is not only transforming the way people hook up, it is changing the way single people spend their money and shaping the nature of household spending, according to one investor taking an interest in the emerging sector.

"It's driving pretty much everything, if you think about all the things people spend money on around finding a romantic partner, courting them, getting married, having kids," said Daniel McMurtrie, the young co-founder and CEO of Tyro Capital Management, a New York hedge fund.

McMurtrie, 28, has tracked the rising tide in people going online to find a partner "from a kind of niche category, which was a little bit of a joke to some people, to being the dominant form of dating."

According to a Pew Research Center study published Thursday, 30 per cent of American adults have used a dating app or website. For people under 30, that increases to 50 per cent.

The proliferation of smartphones and the ease of using apps have been game changers. All a user has to do is enter a small amount of personal information to start seeing photos of potential matches. A simple swipe of the finger can show interest, and if it is reciprocated, start a conversation.

The financial cost of arranging a date has been drastically reduced, as has the cost in time from wasted encounters or rejections.

"Historically people have dated within their social circles, their friends, their family, their church, their social groups," said McMurtrie. "That's really maybe 100, 200 people max."
The social penalties have also been reduced. "If you date someone who's a friend of a friend and it doesn't work out, that can be very awkward." "Because everyone can get a number of dates instantly through an app, it doesn't really make sense to take that risk anymore," noted McMurtrie, who published a research paper on the phenomenon in November.

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