Tinder is a cash cow because it's using AI to develop a dynamic pricing model

Match Group is ramping up the monetization on its popular Tinder app. Its investments in technology infrastructure, data science, and market segmentation have begun to pay off. As a result, geolocation tools and more artificial intelligence-powered features are next up. These will likely juice Tinder's dynamic pricing model, which consists of premium plans like Tinder Gold and Tinder Plus. Tinder wants to add enhancements to the "post match experience" as well as test and rollout location features in 2018. Tinder has a data science team, which is led by Dr. Xue Liu, a computer science professor from McGill University. Going forward, it will apply artificial intelligence to drive matches, monetization, and revenue growth. But by applying AI to Tinder's dynamic pricing model, the potential for optimization gets really interesting. For example: For a 29-year-old male in New York City, Tinder Gold costs $12.50 a month for 12 months. But a 21-year-old female in Nashville can get Tinder Plus for $4.58 a month or Tinder Gold for $6.92 a month. These multiple price points are not only geographically-driven but also driven by a number of components to discounting. Although pricing is unclear at best, this model is by design. Tinder is trying to thread the needle between revenue growth, new features, and the data provided by 1.6 billion swipes a day. Tinder hit 2.6 million paying users in November 2017.