eHarmony.com Inc.

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eHarmony.com Inc.

300 N. Lake Avenue, Suite 111
Pasadena, California 91101
U.S.A.
Telephone: (626) 795-4814
Web site: http://www.eharmony.com

Private Company
Founded: 1998
Employees: 120
Sales: $100 million (2004 est.)
NAIC: 516110 Internet Publishing and Broadcasting

If you are single and looking for long-term love, eHarmony.com Inc. wants to find you the "perfect mate." With traditional values and modern matchmaking possibilities, eHarmony.com has taken the electronic dating scene by storm. Founder Dr. Neil Clark Warren, a clinical psychologist, has specialized in relationships for nearly four decades and has written several bestselling books. Using the patented and trademarked Compatibility Matching System, eHarmony has united more than 10,000 couples in marriage in its short history and, during 2005, had more than six million registered users.

In the Beginning: 1950s to Early 1990s

Warren was born in Des Moines, Iowa, in 1934. His father was a car dealer and his mother, whose maiden name, Clark, he added to his own, was a homemaker. Warren graduated from Pepperdine University with a bachelor's degree, and went on to earn a master's in divinity from Princeton Theological Seminary in 1959, the same year he married Marylyn Mann. The couple soon moved to Chicago where Warren worked as a staff counselor and taught at the University of Chicago.

After receiving his Ph.D. in 1967, Warren accepted a teaching position at Fuller Theological Seminary in Pasadena, California. He began as an assistant professor and within a year was promoted to associate professor, a post he held until 1974 when he was named dean of the graduate school of psychology. During his years at Fuller, Warren had gone into private practice and founded Associated Psychological Services in 1971. In his years as a practicing psychologist, Warren counseled couples and began to see a pattern in why marriages ended in divorce. He researched marriage and divorce and began conducting what he termed "divorce autopsies" to determine why so many marriages failed. He found one simple fact over and over—that many couples simply were not with the right person and never should have been married in the first place. To help couples make the right choices and avoid the agony of divorce, Warren believed compatibility was the key to a strong, long-term relationship.

Warren's first book, Make Anger Your Ally (Doubleday, 1983) was the author's attempt to understand the power of anger and turn it into a productive rather than destructive part of life. His next book came almost a decade later, a relationship-themed "how-to" book about finding the perfect mate. Finding the Love of Your Life (Focus on the Family, 1992) detailed ten "principles" guiding how to choose the right mate for life. The popularity of this book led to the formation of Neil Clark Warren and Associates (NCW&A) in 1995 to market Warren's approach to relationships. As he traveled the country for speaking engagements and appeared on talk shows, Greg Forgatch, who was married to Warren's eldest daughter, Lorraine, ran the company.

Warren's straightforward principles about life and love gained him acclaim across the country. His message was sincere and, though he was a devout Christian, nonsectarian. He touted "mastering the art of intimacy" in Finding the Love of Your Life, as well as the importance of family support, emotional health, and being willing and able to completely commit oneself to a relationship. Warren's next book, Finding Contentment (Thomas Nelson, 1997) followed along the same lines of thought, as did The Triumphant Marriage: 100 Extremely Successful Couples Reveal Their Secrets (Focus on the Family, 1995) and Learning to Live with the Love of Your Life, and Loving It (Tyndale House, 1995).

In his next books, Warren went from finding the perfect mate to sustaining a healthy marriage. He outlined new principles or "special somethings" that made marriages work, discussing issues such as trust, intimacy, and communication.Finding Contentment (Thomas Nelson) came out in 1997 and secured an ever growing audience for Warren's declarations on relationships. As he gained recognition for his no-nonsense approach to love and marriage, Warren continued to counsel and began an extensive research project, interviewing some 5,000 couples across the United States. This project, undertaken with Forgatch in 1997, led to the personality and compatibility profile later developed for eHarmony.

Cupid Online: 1998 and 1999

The eHarmony concept was created in 1998 by Warren and Forgatch, to take Warren's scientific approach to love and marriage to the masses. Forgatch was eHarmony's "idea" man and chief executive, while Warren used his three decades of clinical psychology to make the concept work. Everyone involved with eHarmony had high hopes about its science-meets-love matchmaking capabilities; yet to Warren finding a soul mate was more than a business proposition, it represented the single most important milestone in a person's life. Finding a mate was tantamount to lifelong fulfillment and happiness—and he knew this firsthand, having been married to Marylyn for 40 years.

The eHarmony concept began with an in-depth 436-item personality profile covering 29 different "dimensions" of personality, such as character (curiosity, intellect, appearance), "emotional makeup" (anger, mood, and conflict issues), family values (background, education, spirituality), and traits (humor, sociability, ambition). Whereas some singles found the questionnaire tedious and exhausting, others applauded its thorough nature and found the results revealing and insightful. This, too, was no accident; Warren and Forgatch figured that only those truly committed to finding an appropriate mate would complete the entire process.

Once an interested person completed the questionnaire, eHarmony would search its database for matches, but only for individuals who met at least 25 out of the 29 compatibility areas, on either a local or worldwide basis. The results, according to the company's web site, would be "matches unlike those on any other online dating service" and "scientifically evaluated to be uniquely compatible" with each prospective eHarmony member. Once a match was found, however, love-seekers needed to officially become an eHarmony member by paying $49.95 for a one-month trial membership, $99.95 for three months, $149.95 for six months, or $249.95 for a year-long membership. eHarmony guaranteed at least one match per month (though there were often dozens), with the hope of falling in love for what Warren considered "the right reasons."

The catch, however, was that only singles over the age of 21 and looking for a serious long-term relationship needed to apply; eHarmony was not for casual daters and routinely turned away up to 20 percent of its prospective clients. eHarmony also turned away anyone who had been married more than three times, as well as those suffering from serious mental health problems such as depression (they were asked to take some time to heal before signing up for membership). Next came a four-step process for deciding which mate(s) truly met a member's dating and relationship criteria, the possible exchange of photos, and eventually setting up an actual face-to-face meeting. The process apparently worked wonders for many lonely singles, as touted in numerous articles about eHarmony and popular print and broadcast advertising. Warren, however, did not advocate a quick trip to the altar; he believed couples should continue to explore their relationship and not rush into marriage—taking up to two years before tying the proverbial knot.

Conquering the Internet: 2000–03

In 2000 Warren published Catching the Rhythm of Love (Thomas Nelson) as he turned his attention more fully to eHarmony. The official web site, eHarmony.com, was launched on August 22, 2000, with $3 million in venture capital from Fayez Sarofim & Company. Although the World Wide Web was littered with the carcasses of numerous dot.com failures, Warren and Forgatch believed in eHarmony not only because it was vastly different from anything else on the Internet, but because it could offer single men and women a real chance at finding their soul mates. Even Warren's wife of 45 years, Marylyn, was on board, serving as the company's senior vice-president and media consultant after a decades-long career in public relations.

Within three months of its debut, eHarmony had 20,000 registered users and was quickly gaining the attention of web singles. Warren continued to write and publish, with Love the Life You Live (with Les Parrott, Ph.D., Tyndale House, 2002) and Date or Soul Mate? How to Know If Someone Is Worth Pursuing in Two Dates or Less (Thomas Nelson, 2003). While eHarmony certainly was not the first online dating service, it had made a big splash and sent ripples through the industry. Its toughest competition came from InterActive Corporation's Match.com, which offered love matches for as low as $19.95 per month and allowed singles to post photos and personal information. Other rivals included True.com at $29.99 per month, which minimized the "creep factor" by running prospective matches through criminal databases, and Matchnet.com's successful JDate and AmericanSingles, which offered a wide array of online dating services for varying prices per month.

Company Perspectives:

With over five million users, eHarmony is the Internet's premier relationship service. Founded by relationship expert, best-selling author and psychologist Dr. Neil Clark Warren, eHarmony is the first and only online dating site dedicated exclusively to helping serious singles build lasting relationships for life-long love and happiness. eHarmony's patented matching technology is based on 35 years of empirical and clinical research on successful marriages, and it is the only site that brings singles together using a scientifically-proven set of compatibility principles based on proven marital success. Since its inception in 2000, eHarmony has been the first step down the aisle for thousands of its users. eHarmony is a private company headquartered in Pasadena, California and on the Web at www.eharmony.com.

By 2003 consumers spent more than $300 million on U.S. dating sites according to online researcher Jupiter Communications, Inc. In response to eHarmony's popularity, Match.com, which had become the Internet's top dating service, began offering its own version of compatibility and personality testing at its sites. Match.com had brought in revenues of $185 million for 2003 (up from $125 million in 2002) and its success prompted its parent company, InterActive, to file initial public offering papers. Although there seemed to be considerable interest, InterActive backed off and withdrew its papers within a week.

While eHarmony had garnered a solid reputation by 2003, the company had tapped only a small portion of the millions of singles looking for love. Marketing efforts in the last half of the year brought notice, with more than 300,000 new members signing up and bringing the firm's total registered users to about 3.5 million. According to Internet News (May 13, 2004), eHarmony had become the fastest growing online love connection, averaging more than a million visits to its web site per month (out of an estimated 35 million visits to online dating sites worldwide) with as many as 10,000 new visitors per day taking its in-depth personality profile. Other matchmaking web sites cashing in on the phenomenon included Playboy.com, personals listings at Monster.com and Yahoo!, as well as Dating.com, Dreammates.com, Cupid.com, Friendster.com, and a slew of others.

Diamonds Are a Girl's Best Friend:
2004 and Beyond

In 2004 eHarmony experienced unprecedented growth, through strategic alliances and aggressive marketing. As a result of its advertising success in 2003, eHarmony initiated another major advertising campaign, determined to become a household word. Spending upward of $10 million on radio and $40 million on television ads, eHarmony reached millions of prospective clients through its marketing efforts, led by Donat/Wald of Santa Monica, California. Popular 2004 ads featured real-life couples who had found each other through eHarmony, touting, "Who knew science and love were so compatible?" Another of Dr. Warren's taglines, "Fall in love for all the right reasons," was featured in radio and television advertisements. Competitor Match.com also had begun publicizing its success stories, reporting an average of 40 or so wedding announcements per month, and remained the Internet's largest online dating site with 12 million users.

eHarmony also made news in 2004 through its partnerships with Friendster.com and the Gannett Corporation's newspaper empire. Friendster.com, one of the Internet's pioneering social networks, signed on with eHarmony to offer members online matchmaking, while Gannett, owner of the widely read USA Today, agreed to have its personal ads linked to eHarmony's site. Near the end of the year eHarmony sought financing and received $110 million in funds from two venture capital firms. Although eHarmony, a private company, did not publicize its year-end revenues, the figure was estimated at around $100 million for 2004.

Early the following year, 2005, eHarmony entered a partnership with Third Age Inc., a marketing and research firm specializing in Baby Boomers. The joint venture was formed to help older single Americans—the 40-plus crowd, which was estimated at around 100 million—find love and lasting relationships like eHarmony's younger clientele. On Valentine's Day in 2005 eHarmony celebrated its success by delivering gifts to all of its married members. Warren commented in a press release, "Valentine's Day so often focuses only on romantic love—but eHarmony members know successful relationships must be founded on the deeper values that can sustain love year-round." eHarmony marked the occasion with an appropriately heart-shaped glass bowl from Tiffany & Company, delivered to thousands of members who had found their "perfect mate" through eHarmony.com.

With a title familiar to any eHarmony member, Warren published Falling in Love for All the Right Reasons: How to Find Your Soul Mate (Center Street, New York). The book reiterated Warren's caveat that strong relationships began with compatibility. His message resonated with millions of singles seeking love, as eHarmony averaged from 10,000 to 15,000 new visitors each day and a worldwide membership of more than six million. As the company grew and outdistanced much of its competition, the biggest question concerning eHarmony's future seemed to be whether the company would go public. Warren and Forgatch were mum on the subject, but it was not outside the realm of possibility.

Principal Competitors

Cupid.com; Dating.com; Dreammates.com; Lavalife; Matchmaker.com; Matchnet; Match.com; PerfectMatch.com; Soulmate.com; True.com; Yahoo! Personals.

Key Dates:

1959:: Neil Clark Warren and Marylyn Mann marry.
1967:: Warren begins private practice as a clinical psychologist.
1992:: Warren's first relationship book, Find the Love of Your Life, is published.
1995:: Match.com launches an online dating service.
1998:: eHarmony is founded in Pasadena, California, by Warren and Greg Forgatch.
2000:: The eHarmony web site (eHarmony.com) is launched.
2002:: Warren coauthors Love the Life You Live (Tyndale House).
2003:: Warren's Date—or Soul Mate? is published by Thomas Nelson.
2004:: eHarmony scores with radio and television ads by Donat/Wald; hits at the site climb to more than 10,000 daily.
2005:: eHarmony.com forms a partnership with marketing firm Third Age Inc.