Key points:
- Bumble completed first-ever acquisition of French dating app Fruitz
- The company is expanding its international footprint, building on the success of Badoo
- With Gen-Z as the popular demongraphic, Fruitz could bolster Bumble’s competitive profile
Bumble (NASDAQ: BMBL) and Match Group have had their horns locked in the domestic market for some time now; with the former hot on the tail of the dating giant; the parent company of brands like Match, Hinge, and the hugely popular Tinder. Now though, despite a poor market reaction to recent earnings in the face of the market leader, the company has completed its first-ever acquisition; in a bid to win the hearts of the European market.
Bumble announced today its acquisition of rapidly-growing French dating app Fruitz, which could be interesting for investors for numerous reasons. Firstly, Bumble is building on its international footprint. Following the success of Badoo in Europe, it makes sense for Bumble to continue its expansion strategy – but this time, the company has honed in on a specific honeypot – the Gen Z generation.
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Gaining traction in neglected demographics is vital for companies like Bumble and Match Group. Tinder – although incredibly popular with younger generations – doesn’t utilize demographic-specific features, while Fruitz’s unconventional match selection that focuses on user intention has been incredibly popular amongst Gen Z users.
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Bumble’s early action on Fruitz could prove pivotal to the company’s sustained growth amongst the competitive landscape built by Match Group – despite Goldman Sachs’s belief that both Bumble and Match can grow together. This is certainly the type of strategy we need to see from Bumble in order to attract investment back into the deflated stock. Bumble is scheduled to announce earnings next month, so investors might want to pay particular attention to the company’s outlook regarding Fruitz, and further hints of the company’s strategy moving forward.