Increase Due to Rapid Growth of Online Dating Market in China
GUANGZHOU, China, March 6 /Xinhua-PRNewswire/ -- Marry5.com, a leading online dating website in China, announced today that its monthly revenues have reached US$300,000, with the Company expecting to see things continue to improve thanks to the launch of their supermarket-style online checkouts.
In the Web 2.0 era, network segmentation further drives the online dating market, and the online friends-making model is becoming increasingly popular. In 2006, a group of professional online dating websites emerged in China, attracting a great deal of interest from venture capital firms. As early as December 2005, Shenzhen Haotian's pengpeng.com and Marry5.com received US$12.5 million from Softbank Asia; then in early 2006, YeeYoo.com secured an investment of US$20 million from Meetic, one of the largest dating websites in Europe; and baihe.com raised a total of US$11 million in two rounds of investment from investors such as NEA, a world-famous venture capital firm. Other websites including love21cn.com and 96333.com have also benefited from venture capitalists.
However, after the initial investment fever, dating websites have had to face the reality of their operating problems directly, some of which even declaring no chance of the possibility of making a profit, having seen all their investments used up. Under such circumstances, Marry5.com first announced that it has addressed its profitability thanks to a steady revenue growth. Marry5.com jumped to one of the top 900 among global websites in early 2007, and had an ALEXA industry ranking of 1 in December 2006.
In China, netizens have become accustomed to free internet services, and the majority of dating websites now still attract users by adopting a free membership strategy. By contrast, similar foreign websites charge membership fees as a primary approach to profitability. For example, Match.com generates US$260 million in revenues a year from membership fees alone. Another website, eHarmony has 7 million registered users, 20% of whom are paid users, with each paying US$49.95 a month. Successful foreign cases provide some enlightenment to Chinese websites. Under profitability pressure, some websites have launched very expensive service packages for their members. This, however, results in an awkward situation: money comes while popularity drops.
According to a survey of Chinese netizens conducted by iResearch, a third-party research agency, 70% of netizens are willing to pay to make friends online, among whom, 29.5% are willing to spend under RMB10 (US$1.3), 18.8% to spend RMB10-30 (US$1.3-3.8), 11.1% to spend RMB30-50 (US$3.8-6.4), 7.7% to spend RMB50-100 (US$6.4-12.8), and even 2.3% to spend over RMB100. "Facing such diversified consumer habits and affordability, it is obviously difficult for uniform and very expensive charges service packages to survive. Undoubtedly, this practice sets a threshold and accordingly keeps a large number of potential consumers out, creating a bottleneck for the development of the websites themselves. Furthermore, while advocating personalized services today, uniform service packages are unreasonable. Due to different individual needs, such services mean inevitable waste for users. It appears to be more market-oriented to let users make a choice themselves," analyzed Xu Xinyue, General Manager at Marry5.com. So, Marry5.com innovatively has proposed a supermarket model in China's online dating market. "Unlike packaging membership like tickets for theme parks, what we offer is more like a supermarket. When logging on to our website, following their free registration, members can select what they want. They have the right to choose either paid or free products for their service package, customizing it so as to best meet their own needs."
Now, Marry5.com offers diversified paid products with charges ranging from RMB2 to RMB260 (US$0.25-US$33), including such basic functions as music, star member profile, wireless services and personal love consultations, as well as professional dating products and various offline activities.
From the humble beginnings of offering simple offline activities and wireless products to the full-blooded array of offerings today, Marry5.com has witnessed increased revenues after only one year. Driven by its groundbreaking offline activity, "looking for love in the same office building," paid activities have been accepted, and even welcomed, by many users. The website has produced revenues since September 2006, reaching almost US$130,000 per month by December 2006. In 2007, the newly launched "True Love" series and love consultation services have seen over 10,000 purchases, boosting revenues. This new influx of revenues has helped the site see its monthly revenues reach US$300,000. The website has even forecast that it will not only become No.1 in the industry in 2007, but would also be making a profit by the end of the year, positioning itself in anticipation of its IPO in 2008.
Currently, online dating services have a strong momentum throughout the world, and although it is still in the development stage in China, the market is expected to far outstrip Europe in the future. Statistics from iResearch said that China's online dating market is growing at an annual rate of 60%, and is expected to reach nearly US$84 million by 2008. Marry5.com has benefited from such a huge market and is more confident of occupying a larger share of the attractive market. "Right now we have 4.5 million registered members, and this figure is growing at a rate of 300,000 per month. Our target users are highly educated, high-income white-collar workers with high consumption ability. Given that only 10% of users are willing to purchase services with a spending average of RMB10 each, our revenues will reach up to RMB4.5 million (US$577,000) per month. It is just a conservative estimate and will certainly go up as users will tend to get more mature and the online dating market will become better defined," Xu explained.
Overseas Investors Detect Business Opportunities
With Marry5.com jumping to the top 900 among global websites in early 2007, and with its new ALEXA ranking of 1 in December 2006, many overseas investors are seeking cooperation with the website. "To get a slice of the online dating market cake in China, it becomes a key for foreign investment institutions to find a strong partner. With our effective profitability model, our targets to become No.1 in the industry in 2007 and go public in 2008 are round the corner. So the return on investment in such a ‘potential stock' as Marry5.com is clear," Xu said. When asked whether it will introduce another large investment in the near future following Softbank and about ongoing cooperation, Xu refused to comment, just saying that the project is still in negotiation, and acquiesced in the possibility of the cooperation.
By promoting its business model of "online + wireless + offline activities," combined with its supermarket model for profitability, Marry5.com seems to have a considerable development potential in the future. It is still a key in competition for all major dating websites to seek business opportunities among millions of young Chinese people striving to find their soul mates.
About Marry5.com
In June 2005, SAIF ( http://www.sbaif.com ) invested US$12.50 million in ACT Technology Co., Ltd (parent of Marry5.com) for a minority stake.
Since its launch on October 28, 2005, Marry5.com had had more than 4.5 million active registered users with monthly revenues exceeding RMB1.2 million. The number of new members recently also exceeded 300,000 each month.
In addition to online services, Marry5.com provides wireless and offline activities to ensure integrated friends-making services for its members under the support of its parent company ACT. With such a system, Marry5.com has enhanced its awareness on the internet and appeared in the top two spots (based on ALEXA rankings) among China's dating websites. In the 2006, Marry5.com won many honors, such as a "Top 100 Commercial Website in China," the "Special Mention Award" at the China Internet Conference 2006, and the "Top 10 Creative Investment Awards 2006."
For more information, please contact:
Lincole Lam,
Marketing Dept.,
Marry5.com
Tel: +86-20-3879-9930
Fax: +86-20-3879-9905 x137
Email: Lincole.lin@m-time.com
Web: http://www.Marry5.com
