Not a Tinder user or investor, but this makes me curious. Why is it okay for insurance companies to sell me products with hyper-personalized pricing (often based on sex, age, and race), but it's not okay for Tinder or other tech companies to do so?
Marketing methods are often a little more fuzzy and less ethical than the actual underwriting. Insurers and marketers know about all sort of stuff that affects insurability, from eating habits, to gun ownership, to participation in high risk activity.
I don’t necessarily understand what Tinder does precisely, but it’s pretty obvious that you can exploit the insecurity or desperation of people looking for dates. It’s gonna be easier to extract cash from a 45 year old divorced woman than a 25 year old single woman. And you may want to use tolls as a friction point to reduce the number of undesirable or less profitable men.
You can probably use willingness to pay as a factor to score matches that will generate more churn that keeps the subscription in place. Generally speaking, I expect the most evil imaginable from companies like this. Online dating is a real mill, especially when you pass the threshold where you’re not attached and most people in your cohort are.
May as well just ban the sub-180 midgets who are wasting their time. Then charge a premium for having a choice pool of candidates for the other half.
In the US, at least, you actually need to to get pre-approval for your prices and how you arrive at that price, and that information becomes public record.
But some factors get a free pass whereas others don't. eg. age/sex is allowed, but race/income/education isn't (although zip codes approximate some of those, to an extent).
(Side note, in the lead up to the restriction on how insurers could base their premiums, there was a failed initiative in the 90s that would have made California a no-fault state and would handle funding insurance through a surcharge on gasoline prices.)
Men under 25 pay the highest premiums due to their repeated statistically demonstrated tendency to take far more risks and accordingly have far more serious accidents.
(And good luck getting full insurance if you're male, under 25 and own a vehicle with a turbo.)
Likewise, women 30+ get lower premiums than men because while they have more fender benders, they have far less serious crashes - and our insurance companies proudly advertise to women on that basis.
And your car premium will vary based on your location's car theft rates, although how you store your car (garage vs. driveway vs. street parking) and installed antitheft devices will reduce it.
However, race based pricing is very much not a thing.
It probably could be, as a proxy for socio-economic status, as the indigenous people of NZ are over-represented in all negative socio-economic indicators, thanks to colonisation followed by about a century of government policy, some deliberate (e.g., Tohunga Suppression Act 1907), some accidental (Manpower Act 1944).
And poor young men are even more at risk of serious accident than other young men.
That said, as no insurer will pay out if your car didn't have a current warrant of fitness (proof that your car meets minimum safety regulations), or current registration (just a tax, used to fund road maintenance and our no-fault accident insurance scheme), that effectively discriminates against poor people anyway.
Incidentally, NZ doesn't have compulsory third party insurance.
And I strongly support that - making it compulsory only benefits insurance companies by reducing their risk (which they aren't compelled to pass on to customers as lower premiums), and because once something is mandatory, you can charge far more than is fair, and people can't respond like a rational market would by just not buying your service.
E.g., I'm a redhead living in the Southern Hemisphere who has been active in the outdoors all my life and who smoked for 30 years.
So to get insurance that paid out in the event of terminal illness, I had to either pay a massive premium, or agree to exclude melanoma and lung cancer.
Makes sense - redheads produce minimal melanin, and there is far more UV exposure in the Southern Hemisphere due to the ozone "hole" that forms over Antarctica every year and drifts north onto southern South America / southern Africa / Australia / New Zealand. So as a ginger who had spent a lot of time outdoors under a harsher sun, I'm definitely in one of the rows in that actuarial table that's coloured red in Excel.
(And smoking is self-evident).
Now, back to Tinder. Are they charging based on risk? No.
They're charging what people will pay. And I'm willing to bet that they consider a recently divorced 48 year old man is able to pay more, and if I'm being uncharitable, desperate enough to do so.
So your comparison is very much apples and oranges.
They're a) far more likely to find a partner and b) leave the platform when they do.
So higher "risk" of exiting the platform from Tinder's POV, so you'd want to get their money upfront, presumably?
Divorced men who are going to fat while balding, with 50/50 care of three kids and alimony to pay, aren't flying off the shelf.
So for Tinder, they're a low exit risk, and typically far more able and willing to pay for features that they think might aid them.
A 25 year old man in good shape, no kids, and starting out on a good career, is far less likely to _need_ the features Tinder charges for.
It's well-known that insurance rates vary a lot from person to person (transparency) _and_ there's multiple insurance companies offering what's effectively the same service (competition). So, if I don't like the price, I can get my car/house/boat insured with someone else who will likely give me a different personalized price.
In this case Tinder seems to be working hard to keep the magnitude of the pricing variance secret and there's no real competition since Tinder's apps are the only way to access the service.
Personalized pricing for a digital service with a more-or-less constant cost-per-user doesn't make sense here (unless you want to maximize profits by unfairly discriminating against certain demographics).
If discrimination by gender or other relevant characteristic was illegal in the US that might have some legal, not moral bearing, but no one cares.
> In the United States, a few states have adopted statutes forbidding gender-based price discrimination, but these policies are largely unenforced.
https://en.m.wikipedia.org/wiki/Gender-based_price_discrimin...
That "crap" is something you brought up on your own. We're discussing unfair discriminatory pricing, not mating.
Agreed, which is why it was a big collective fuckup for Western societies to migrate from the societies where premarital and extramarital sex was condemned, thus ensuring a far more even distribution of sexual access for men and women.
Is that 'unfairly discriminating against a certain demographic'?
I suspect it gets a free pass because the demographic being discriminated against is better off (eg. adults who tend to have more disposable income). If it were the other way around (eg. software companies charging elderly people more because they don't know any better), there's going to be more backlash.
this is why you don't see a discount for couples usually - coz they were going to pay even without the discount.
"Most people are fine with movie theatres charging 65+ SENIORS less than they charge adults."
1. Consumer surplus
2. https://www.economicshelp.org/blog/7042/economics/examples-o...
The most sense it makes for Tinder to do is to chage men more than women, which they already did.
Insurance cost is determined based on actuarial tables, whereas Tinder probably doesn't even consider the size of anyones table.