――What’s the purpose of visiting Asia this time?
I came here to have a press conference in Seoul, because of the recent lifting overturning of the anti-adultery law by the constitutional court in South Korea. We also thought it would be good time to visit to Japan as well and talk to the media to give the impression of the current state of infidelity here in Japan.
Another reason why I am here in Japan is also, last year is still little more than 50% of both our membership and our revenue was from the North America, but given the growth rate we’ve seen here in Asia, particularly in Japan, and now also a relaunch of South Korea, we actually believe that the numbers indicate that within two to three years at the latest, Asia will be responsible for more than 50 % of our membership and revenue.
Currently, Japan is top five market. Fifth best market. Although, South Korea is coming up strong, and Japan is the number one obviously market to date, but South Korea is coming strong?so let’s see who ends that battle.
――Well, I know that you company is a for-profit company, but do you ever talk to business media?
Always. We are very successful company, and have been so. Well, we have been profitable since six months of our existence. We thought it would take three years before we become profitable, but we actually reached that point after just six months. Ashley Madison has been profitable ever since then.
So, the last year, our revenue was $115 million, it was 40% growth of the previous year. Also, if you look at profit margin, it was 55% last year. I think few companies can claim such achievement.
Married and unsatisfied
――I understand Mr. Noel Biderman, a founder of Ashley Madison, used to work as a lawyer. How did he come up with starting this company?
So, the idea came to him while he was sitting at the airport in Toronto reading a newspaper article written by female journalists who was predicting the end of online dating. And reason she came with the conclusion because she has gone on 10 blind dates whom she met online. Out of those 10 blind dates, three were men that were not looking for true love, but affair. So, she said this online dating thing would never work, because there are some people who are not honest.
Obviously, she could have been more wrong about online dating sector which has been one of the most successful sectors petty much form the start. But it got him thinking--about 30% of men the journalist has met who are not looking for true love but for an affair.
False expectation you create you are not being honest, the other person falls in love with you for example, and finds out all of sudden that you are already taken, he has your name, your phone number, maybe your address. They can create a lot of problems for you. That’s why Noel came up with the idea the meeting place or communication platform specifically for those people that are not looking for true love online, but for affairs.
Thirteen years later, we are operating in 46 counties, available in 24 languages, and have almost 34 million members worldwide. The last year the membership grew by more than 35%, and by now, one new member signs up every four seconds which makes us one of the fastest growing SNS in the world.
We started out as a niche dating site, but now, 13 years later, we are the biggest paid dating site already. In the end, when you think it actually makes a sense because the traditional online dating companies are dealing with single people, and the most countries, single population is usually somewhere between 10 to 20%, which means that potential customers for Ashley Madison make up 80 to 90% of the population.
――How do you attract new customers? I don’t think you can put ads on The New York Times….
Bulk of our marketing is search-engine marketing. Occasionally, we are able to do “normal” banner online marketing campaign on top media sites. In certain countries, it is possible, but the core focus of our ad is SEM.
――Even though Ashley Madison can’t use traditional marketing channels, the number of users has been growing steadily. How is this possible?
Clearly, as some scientists suggested that monogamy is not a part of human DNAs, monogamy might be actually unnatural for human being. Traditionally, people have looked for affair either in the work place or social circle like family and friends, and both environments has high risk of affair being discovered. With the possible very negative consequences, and resulting in extreme cases divorce and such things. So, for the first time, now people have safe and discreet alternatives to look for an affair, beyond their local area.
One thing we have found out which I feel very assuring is that in the end, men and women are same, and people from whether they are from Canada, New Zealand or Argentina, or all corners of the globe, have the same needs and desire, and the top reason to motivate people to seek an affair lack of emotional attention from the partner and lack of love life in their relationship which shows that in the end, we are all equal, and we all do have same needs and desires.
We did not invent infidelity
――What kind of people use your service?
Here in Japan, what’s interesting is that for example, the age range, we find that the highest percentage of women are in the age group 25 to 34, 42%, and that’s above the international average, and among our male Japanese members, it is rather older than the international average. So, we have 21% between 45 and 54, and we have 5% over 55, which is about double than the international average.
And what we see is that Japanese members have the highest degree of education compared to the global average. We have 35% of men and 32% women which have masters’ degrees--that is double of the international average.
Then our Japanese users tend to have higher disposal income. There is singularity here in Japan that men tend to earn above the international average, so, we have 8% that earn between $250,000 to 1 million--that is 50% above the international average. On the other hand, the women, 48% earn $25,000 to $49,000, which is also 50% above the international average.
But why is there a bleach between men and women in Japan than any other countries we operate? Obviously, it seems that gender equality still has some way to go here in Japan, and maybe one of the reasons why we are so successful among Japanese women--Japan is the country we have the highest percentage of women--may be due to the fact that Japanese women are more educated than the world average, and just as educated as Japanese men, yet, they earn lot less.
So, maybe it’s their way of claiming women inequality saying “look, you are having affairs and you are earning more, now, even if we are not earning more yet, at least we have a possibility to have affair as well.”
Traditionally, it’s been a lot easier for Japanese men to have an affair, there are whole lot of services like Geisha culture that was geared towards allowing men to have affair, but never for the women, so now for the first time, with Ashley Madison, women has safe and discreet way to do the similar thing.
――How active are your users?
Twenty-five to 30% of our members log in at least once a month, 80 to 90% of the member logs in at least once a year.
Ashley Madison is different from other dating sites, most of the activities happening over the weekend when the people have gone out and come home because they did not meet anyone. Actually, our peak times are from Monday to Thursday because over the weekend, our users hope that something would happen at home, and when it doesn’t, they look at the site Monday morning on the way to work, or the lunch hours, they connect online.
The peak hour is before work, either before work or late at night, when the partner is already gone to the bed because often lunch hours are when affair partner meet up to have a date.
――Ashely Madison has been quite controversial. Some says your service is encouraging infidelity or it is ethically wrong. What do you say to those criticisms?
Obviously, yes, people do critique us. What I can say is that we did not invent infidelity. And we actually don’t even promote it. Our existence or any kind of adverting you can put there, you can never convince someone that is happy with their relationship. All we are doing is to provide a platform and community for those people who has decided they want to seek an affair to do so.
I think ones that attack us were the first ones to sign up because we do extremely well in regions of parts of the world that are considered socially conservative.
India and Taiwan are also big markets
――You have mentioned about you see healthy growths both in Japan and South Korea. What about the rest of Asian countries?
We are doing well in India, we have more than half a million members. We launched in Philippines in the end of November last year, and Thailand in March of this year. The third most important market here which is growing as strong as Japan and Korea is Taiwan where we have more than half a million members.
――What about China? Do you have an intention to start the service there?
Obviously, we would like to enter mainland China, but the given the nature of its business, it’s not going to be easy.
――Do you see any obstacles going forward, especially growing your business in Asia?
So far, in terms of resistance, there is only one country which is Singapore that continuously bans us. Also a good number, if not often, all marketing channels are closed to us for ethical reasons. So, it’s more difficult for us than it is for the “normal” companies to reach our potential customers because of those difficulties and obstacles.
――By the way, have you tried Ashley Madison before?
No. I’ve not used it. Personally, my view is that fidelity, whether one night stand or mistake can happen to anyone if you are parting with fiends too late or something, and personally, I would actually prefer not to know about it if my partner had one. And I doubt I would confess it. Of course, if this happens every weekends, then it is indicative problem obviously.
When it comes down to long-terms affairs, it’s a different story. If my partner is a member, I would be in shock at first, I would have a difficulty understanding it. But at the same time, I have to ask myself that obviously there is something missing in the relationship and why she didn’t feel comfortable enough to come talk to me about it. But if I ever changed my mind, I would use Ashley Madison.