Eharmony Case Study

In 1998, Dr. Neil Clark Warren and his son-in-law, Greg Forgatch, founded eHarmony. Dr. Warren practiced psychology, with a focus on marriage and family relationships, for 35 years. His decades of experience led him to create eHarmony, as a way for singles seeking a serious relationship to connect. The serious dating segment of the market had not been served before this creation, which is eHarmony has been able to be so successful. As technology has become more advanced and social media more widely used, the online personals industry has been relatively attractive. In 2005, this industry saw a major growth as online dating sites became more socially acceptable. People were beginning to know friends who had met their spouses online, which

Many customers have emerged and are focusing on segments of the market that eHarmony has not touched. The biggest competitor for eHarmony is Match. In 2006, Match introduced a new brand called Chemistry, which is challenging eHarmony in the serious relationship segment. Match realized that the serious relationship segment is much more loyal and is willing to pay more to find a relationship. Like eHarmony, Chemistry requires a questionnaire to be filled out and has a three-step guided communication process, but it differs from eHarmony in that its membership is open to anyone. Also, like eHarmony, Chemistry has a doctor who developed an algorithm to match its members, but this one is based on interpersonal chemistry, rather than psychological compatibility. In addition to this direct competitor, eHarmony is competing with free do-it yourself-sites, which take away one of the biggest barriers that separates casual daters from serious ones. One of the most popular free sites is a site called Plenty of Fish. This site saw rapid visitor growth in the U.K. and Canada, and by 2007 had reached number four in the United States. These free sites received more visitors than eHarmony, since people did not have to pay, but most of these visitors were casual daters, so this is not a major threat to eHarmony. Next to Match, niche sites have proved to be one of the most serious competitors. The largest niche market is the gay and lesbian market, which has attracted one-tenth of internet traffic from heterosexual personals sites. One of the limits of eHarmony is that it is not open to singles interested in the same sex. As this demographic segment is growing, competitors will take the advantage over eHarmony if it does not adapt. Other niche markets include those based on race, faith, health conditions, or various hobbies. While many niche sites enter the market every year, most of them fail