case study

About the only thing harder than finding a date is choosing which Web site to meet him or her on. David Evans, online dating Industry consultant, says there are over 2,000 online dating, sites in the United States alone. The field wasn't quite that crowded when Harvard mathematician friends Chris Coyne, Christian Rudder, Sam Yagan, and Max Krohn founded OkCupid in 2004--but they still had to figure out how to get noticed, In previous ventures, free had been the operative word for OkCupld

CEO Yapan. In the late 1990s, the team forever altered the market for student cheat sheets, then dominated by the iconic black-and-

yellow CliffsNotes booklets, with SparkNotes, a free Web based copycat they later sold to Bames & Noble. After that, they disrupted

the muslc business, creating the file-sharing tool Donkey. Before the company was litigated out of existence by a record-industry

lawsuit, it boasted the world's most popular file-sharing software, bigger even than Napster. Could free work in the industry of online dating? The growing market

was, and still is, dominated by two large competitors: Match.com with 20 million users and $350 million revenue and E Harmony at 20 million users and $250 million revenue, Yagan figured he could inflict serious damage on the industry by using the same strategy they employed with SparkNotes. "Take an existing business, " he explains, reduce the revenue that industry produces by offering a free product, and then claim the remaining revenue for yourself. Yagan and crew spent three years building the site, had raised nearly

97 million, but they were not gaining traction. Being free to join, they needed a massive audience to generate advertising dollars, Alter

two years of growth, traffic was flatlining while competitors were growing rapidly. By early 2007, Yagan realized his window of opportunity was closing. He needed to jump-start his company or face a slow death. Yagan figured the maglc numbers needed were 8 million users and 2 million regular daters, roughly eight times his current traffic. And

upping the pressure, new free dating sites were popping up and beating Yagan at his own game. PlentypfFish.com, a fast-growing Canadian site founded In 2003, surpassed OkCupld, attracting nearly 1.5 million unique viewers a month in the United States by early

2008. The pline world constantly changing didn't help their business mathul-people were turning to social networking sites as de facto dating services.

OkCupid could try fighting back with an ambitious advertising campaign, but where? "Any place you might advertise to attract

daters, someones already there,* he says, "You might think Times Square. But Date's there, You might think Google, but Match is

willing to spend well over $50 per subscription." A quirky dating site

like OkCupid seemed like a perfect fit for a guerrilla marketing campaign, They spent $10,000 in a test to distribute 10,000 red roses

in Boston but gained few users, "It was a flop."

A possible opportunity opened in May 2010 when Facebook founder Mark Zuckerberg announced that outside software developers could build programs, called widgets, that would operate within his company's wildly popular social network. But the problem with

operating inside Facebook was the serious constraint on OkCupid's ability to sell advertising, Furthermore, he worried that OkCupid risked being seen as just another widget maker in a crowded marketplace,

The OkCupid tear could see potential--10 percent of U.S, newly married couples met anline-but promotional aptions seemed

exhausted. Then Yagan remembered a wacky idea he and Coyne had once tossed around a dating site with *a blind-date button." What

had been llttle more than a running joke suddenly seemed like a competitive advantage, They named their Idea Crazy Blind Date (CBDI. C8D would not be for everyone, but for socal, outgoing, and adventurous twentysomethings it could be fun. Since all blind dates would be local, they could launch in selected cites such as Austin, Boston, New York City, and San Francisco. Potential daters would get verified by providing phone and e-mall contact Info pulled from OkCupid profiles. Participants select the day of the week, the times available to meet up, and neighborhood on Google maps- Then they provide a freeform description of ideal date, age range, and gender of date. Finally, daters select the usual body type, ethnicities, religion, and so forth, and hit the "CBD" button, At best, the novelty of instantaneous, face-to-face blind dates might catch on among users inundated with e-mails, phone calls, and instant messages; at worst, it might at least generate buzz for Ok@upid.

1. Entrepreneurs try to build competitive advantages for their

businesses by being unique. How will these partners know If

their CRD idea will make @kOupld stand out, or just creepy?