Here’s how Match Group plans to right the ship at Tinder

In a call with investors on Wednesday, Match Group announced cuts to 8% of its global workforce, and expanded on its 2023 Tinder road map, detailing plans to right the ship at the dating giant.

“It’s been pretty clear since I joined last May that I wasn’t happy with the Tinder roadmap,” Match CEO Bernard Kim said on Wednesday’s call. “I’m holding myself and the Tinder team accountable for delivery of that product road map.”

Match Group reported disappointing financial results Tuesday afternoon, posting its first ever quarterly decline. Though a stronger dollar and difficult economy were partly to blame, the company said star dating app, Tinder‘s “weaker-than-expected product execution” was a major culprit.

“As we look back on 2022 and our Q4 results, it’s clear that the year was challenging and our performance fell short of expectations,” Kim said on Wednesday’s call.

Now, Match appears to be at an inflection point, with Kim shaking up company leadership and working to reignite investor interest. Last week, Match Group announced it was bringing on Snap alum Will Wu to join as the company’s chief technology officer. Kim also took over as Tinder’s interim CEO. The company plans to take on about $6 million in severance and other similar costs this year as it takes its cost-saving initiative.

“The changes we made at Tinder allowed it to quickly regain footing and prioritize product momentum,” Kim added on Wednesday’s call. “In the second half of the year, Tinder saw a significant increase in the number of product features it delivered compared to the first half of 2022.”

Within the company’s letter to shareholders, Match laid out its plan for bringing paying users back to Tinder. The road map focuses on four areas: expanding the core experience, driving deeper engagement, broadening monetization, and improving optimizations.

Expanding the core experience means creating new ways by which users can express themselves. Match says that in the first half of the year, it will revamp profile descriptors and focus on broader inclusivity; in the second half, the company will include “expanded discovery through ‘authentic’ and ‘ephemeral’ moments.”

Deeper engagement will rely on machine learning to create a more tailored user experience in both the matching and postmatch process.

Tinder is also set to drive revenue by offering new services and premium features, which will help broaden monetization. In the coming months that will includes “Just For You” profiles, and other premium discovery preferences, according to the road map. Later this year the company plans to roll out virtual currency and à la carte features.

A large part of Tinder’s revenue growth is hinging on the optimizations plan. That includes optimizing pricing, advertising, new payment methods, and smart paywalls. Match said optimizations are expected to drive roughly two-thirds of Tinder’s revenue growth this year. (Tinder’s revenue per payer dropped 2% in the fourth quarter.)

Tinder, which has to date relied largely on word-of-mouth advertising, is also rolling out its first-ever global marketing campaign in the first quarter of 2023, in an effort to change the narrative and court more users. “Over time, this lack of marketing has contributed to a narrow brand perception that does not celebrate the breadth of relationship possibilities Tinder creates every day,” the company wrote in the shareholder letter.

Still, investors appear to be skeptical. The company’s stock was down more than 8% in premarket trading Wednesday morning.

“We expect it to take a little time in the first half of 2023 to build momentum, but are confident that improved product momentum and our financial discipline position us for much stronger growth and profitability in the back half of the year, as well as longer term,” CFO Gary Swidler said on the investor call.