How Gay Hook-Up App Grindr Is Selling Itself To Major Brand Advertisers
Grindr Grindr CEO Joel Simkhai. Unless they have used it themselves, many advertisers may not know that gay geo-social networking app Grindr has a burgeoning advertising business and a potentially lucrative future data business.
Grindr claims to be the largest all-male mobile social network in the world, with nearly 10 million users in 192 countries. Those users are described in Grindr's pitch document to advertisers (which you can see in full below) as "affluent, tech savvy men," who mostly earn over the average income, spend more on products and services than straight people and are likely to have future travel plans: an ideal target base for advertisers.
However, it's also a potentially risky place for brands to advertise: it's predominantly used to organize no-strings sex, which can often be accompanied with offensive language (although Grindr does have a team of human moderators to attempt to stamp this out). In August a security glitch left users' locations vulnerable to being discovered by third parties. The company has since disabled distance display, which showed how close a potential match was to a user's current location.
Some people also use the app to organize drug pick-ups (many different apps are used for this too, most notoriously Instagram).
Business Insider talked to Grindr's CEO Joel Simkhai and asked what the company is doing to ensure brands are advertising in safe environments on the app that they would want to associate themselves with.
He told us over the phone:
"We have a team of moderators that review for profanity and monitor for the things that you mentioned [the drug pick-ups]. These types of behaviors are prohibited on Grindr and we also comply with iTunes and Google Play guidelines. We are very vigilant on that.
"Part of it is that we have people looking at it, and we can also control where brands [appear on the app] and that they are comfortable. I don't think Grindr is for every brand out there. But it's not X-rated content — maybe shirtless and showing some skin, but that's kind of who we are."
Grindr Grindr's 'Broadcast Message' ad format. And plenty of brands so far have decided Grindr is for them: Uber, Airbnb, Audi, Groupon, Fiat, Live Nation and Dollar Shave Club are among the major brands sitting alongside smaller local businesses recently taking advantage of Grindr's location-based ad offering. Ad formats include traditional banners, text-based "broadcast" messages to inform users of local events or special offers near them and a new full-page interstitial ad that appears as users flick through profiles or close the app. They can be bought through advertising networks or directly through Grindr's 10-person global sales team.
The appeal of Grindr? "If you want to target men, or gay men, we are the natural first choice. Nobody else in the gay market has our scale and ability to deliver these kinds of ad formats," Simkhai claims.
The company does not "talk dollar figures," but advertising revenue in the 12 months to October was up 118% on last year, and ads now make up 25% of total revenue, according to Simkhai. Grindr Xtra subscriptions, which allow users to remove ads, make up the rest of Grindr's income. He adds that Grindr is the top grossing paid-for social networking app on iTunes, which should help people extrapolate how successful the company has been at making money to date.
Future money-making opportunities
But advertising and subscriptions may not be the only revenue stream for Grindr in the future. Simkhai is all too aware about the value of its API and data, which could be licensed to other companies.
"With our data API we'd be comfortable to share some, but not all, we wouldn't divulge any personal information ... we'd be interested in talking to other companies about data, location and the opportunities that come out of that," he said.
Simkhai also revealed that Grindr has been approached by other companies with potential takeover propositions before ( he did not divulge which ones, or the size of the offers placed on the table) and "it's something we'd definitely be open to in the future," he said.
The profile of gay men in business shifted up a gear last month when Apple CEO Tim Cook came out publicly as gay in an essay written for Businessweek. We asked Simkhai, as a gay man in business himself, what impact this news had on him:
"To think that a gay man runs the most valuable company in the world just speaks for itself, it's a tremendous statement for everyone.
"[It says] gay men can be successful in business, they can make a lot of money, and there's no reason to exclude gay men from the business world because you can see they add tremendous value...it makes a guy like me very proud."
This is the document Grindr uses to market itself to potential advertisers and agencies.
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