
It’s so easy
I recently asked why people seem to hate dating apps so much. In response, 80% of you emailed me some version of the following theory:
The thing about dating apps is that if they do a good job and match people up, then the matched people will quit the app and stop paying. So they have an incentive to string people along but not to actually help people find long-term relationships.
May I explain why I don’t find this type of theory very helpful?
I’m not saying that I think it’s wrong, mind you. Rather, my objection is that while the theory is phrased in terms of dating apps, the same basic pattern applies to basically anyone who is trying to make money by doing anything.
For example, consider a pizza restaurant. Try these theories on for size:
Pizza: “The thing about pizza restaurants is that if they use expensive ingredients or labor-intensive pizza-making techniques, then it costs more to make pizza. So they have an incentive to use low-cost ingredients and labor-saving shortcuts.”
Pizza II: “The thing about pizza restaurants is that if they have nice tables separated at a comfortable distance, then they can’t fit as many customers. So they have an incentive to use tiny tables and cram people in cheek by jowl.”
Pizza III: “The thing about pizza restaurants is that if they sell big pizzas, then people will eat them and stop being hungry, meaning they don’t buy additional pizza. So they have an incentive to serve tiny low-calorie pizzas.”
See what I mean? You can construct similar theories for other domains, too:
Cars: “The thing about automakers is that making cars safe is expensive. So they have an incentive to make unsafe cars.”
Videos: “The thing about video streaming is that high-resolution video uses more expensive bandwidth. So they have an incentive to use low-resolution.”
Blogging: “The thing about bloggers is that research is time-consuming. So they have an incentive to be sloppy about the facts.”
Durability: “The thing about {lightbulb, car, phone, refrigerator, cargo ship} manufacturing is that if you make a {lightbulb, car, phone, refrigerator, cargo ship} that lasts a long time, then people won’t buy new ones. So there’s an incentive to make {lightbulbs, cars, phones, refrigerators, cargo ships} that break quickly.”
All these theories can be thought of as instances of two general patterns:
Make product worse, get money: “The thing about selling goods or services is that making goods or services better costs money. So people have an incentive to make goods and services worse.”
Raise price, get money: “The thing about selling goods and services is that if you raise prices, then you get more money. So people have an incentive to raise prices.”
Are these theories wrong? Not exactly. But it sure seems like something is missing.
I’m sure most pizza restauranteurs would be thrilled to sell lukewarm 5 cm cardboard discs for $300 each. They do in fact have an incentive to do that, just as predicted by these theories! Yet, in reality, pizza restaurants usually sell pizzas that are made out of food. So clearly these theories aren’t telling the whole story.
Say you have a lucrative business selling 5 cm cardboard discs for $300. I am likely to think, “I like money. Why don’t I sell pizzas that are only mostly cardboard, but also partly made of flour? And why don’t I sell them for $200, so I can steal Valued Reader’s customers?” But if I did that, then someone else would probably set prices at only $100, or even introduce cardboard-free pizzas, and this would continue until hitting some kind of equilibrium.
Sure, producers want to charge infinity dollars for things that cost them zero dollars to make. But consumers want to pay zero dollars for stuff that’s infinitely valuable. It’s in the conflict between these desires that all interesting theories live.
This is why I don’t think it’s helpful to point out that people have an incentive to make their products worse. Of course they do. The interesting question is, why are they able to get away with it?
First reason stuff is bad: People are cheap
Why are seats so cramped on planes? Is it because airlines are greedy? Sure. But while they might be greedy, I don’t think they’re dumb. If you do a little math, you can calculate that if airlines were to remove a single row of seats, they could add perhaps 2.5 cm (1 in) of extra legroom for everyone, while only decreasing the number of paying customers by around 3%. (This is based on a 737 with single-class, but you get the idea.)
So why don’t airlines rip out a row of seats, raise prices by 3% and enjoy the reduced costs for fuel and customer service? The only answer I can see is that people, on average, aren’t actually willing to pay 3% more for 2.5 cm more legroom. We want a worse but cheaper product, and so that’s what we get.
I think this is the most common reason stuff is “bad”. It’s why Subway sandwiches are so soggy, why video games are so buggy, and why IKEA furniture and Primark clothes fall apart so quickly.
It’s good when things are bad for this reason. Or at least, that’s the premise of capitalism: When companies cut costs, that’s the invisible hand redirecting resources to maximize social value, or whatever. Companies may be motivated by greed. And you may not like it, since you want to pay zero dollars for infinite value. But this is markets working as designed.
Second reason stuff is bad: Information asymmetries
Why is it that almost every book / blog / podcast about longevity is such garbage? Well, we don’t actually know many things that will reliably increase longevity. And those things are mostly all boring / hard / non-fun. And even if you do all of them, it probably only adds a couple of years in expectation. And telling people these facts is not a good way to find suckers who will pay you lots of money for your unproven supplements / seminars / etc.
True! But it doesn’t explain why all longevity stuff is so bad. Why don’t honest people tell the true story and drive all the hucksters out of business? I suspect the answer is that unless you have a lot of scientific training and do a lot of research, it’s basically impossible to figure out just how huckstery all the hucksters really are.
I think this same basic phenomenon explains why some supplements contain heavy metals, why some food contains microplastics, why restaurants use so much butter and salt, why rentals often have crappy insulation, and why most cars seem to only be safe along dimensions included in crash test scores. When consumers can’t tell good from evil, evil triumphs.
Third reason stuff is bad: People have bad taste
Sometimes stuff is bad because people just don’t appreciate the stuff you consider good. Examples are definitionally controversial, but I think this includes restaurants in cities where all restaurants are bad, North American tea, and travel pants. This reason has a blurry boundary with information asymmetries, as seen in ultrasonic humidifiers or products that use Sucralose instead of aspartame for “safety”.
Fourth reason stuff is bad: Pricing power
Finally, sometimes stuff is bad because markets aren’t working. Sometimes a company is selling a product but has some kind of “moat” that makes it hard for anyone else to compete with them, e.g. because of some technological or regulatory barrier, control of some key resource or location, intellectual property, a beloved brand, or network effects.
If that’s true, then those companies don’t have to worry as much about someone else stealing their business, and so (because everyone is axiomatically greedy) they will find ways to make their product cheaper and/or raise prices up until the price is equal to the full value it provides to the marginal consumer.
Why is food so expensive at sporting events? Yes, people have no alternatives. But people know food is expensive at sporting events. And they don’t like it. Instead of selling water for $17, why don’t venues sell water for $2 and raise ticket prices instead? I don’t know. Probably something complicated, like that expensive food allows you to extract extra money from rich people without losing business from non-rich people.
So of course dating apps would love to string people along for years instead of finding them long-term relationships, so they keep paying money each month. I wouldn’t be surprised if some people at those companies have literally thought, “Maybe we should string people along for years instead of finding them long-term relationships, so they keep paying money each month, I love money so much.”
But if they are actually doing that (which is unclear to me) or if they are bad in some other way, then how do they get away with it? Why doesn’t someone else create a competing app that’s better and thereby steal all their business? It seems like the answer has to be either “because that’s impossible” or “because people don’t really want that”. That’s where the mystery begins.
All of the pizza examples are about reducing cost. The argument about dating apps is about increasing retention. The dynamics are qualitatively different.
The argument with pizza is more like "people like salty, fatty food, so pizza places are incentivized to make their pizza less healthy so that people come back more often"... which is exactly what happens!
So why doesn't a legitimately healthy restaurant come along and take the whole market? It's partly because restaurants aren't just in the business of selling (healthy) food: it's also about convenience and satisfaction and experience. More importantly, that just doesn't fit with how people largely make day-to-day decisions.
The same thing happens with dating apps. People get drawn in for all sorts of reasons that don't necessarily map to getting married, even if finding a long-term relationship is explicitly their goal. Tinder competes with Tiktok more than it competes with other dating apps.
The other problem is that making a really effective dating app is just hard. It's fundamentally difficult to help people find compatible partners, especially without in-person contact. That's compounded by cultural and demographic issues. It doesn't matter how well your app is designed when there's a massive imbalance in genders!
> The other problem is that making a really effective dating app is just hard. It's fundamentally difficult to help people find compatible partners, especially without in-person contact. That's compounded by cultural and demographic issues. It doesn't matter how well your app is designed when there's a massive imbalance in genders!
Really true. Most of dating seems to be dominated by that people want to be comfortable and dating is an inherently uncomfortable experience at times and many people seem to have a hard time with it.
I’m writing this as someone that made the conscious decision to face every form of uncomfortableness in dating if I noticed it was needed. Some people look at me bewildered with how I met my wife. They found what I did was way too much effort. But I am thinking to myself: you’re going to spend the most time with them! You better be damn sure that you’re long-term compatible.
Yet, enough people seem to act the whole process is more like buying something from your local Chipotle/<name your favorite establishment> where comfort is king.
Can you expand on what types of uncomfortableness you faced and what you mean by effort (to the point of bewildering people)? Curious what worked for you. Not sure if you just mean you forced yourself to go on a million dates and were super selective.
Super interesting, please share more details! :-)
How did you meet your wife?
> Tinder competes with Tiktok more than it competes with other dating apps.
is a crazy remark, but I think you're right. We're living in weird time!
Yep, Peter Drucker wrote about this all the way back in 1964.
> The competition is therefore all the other activities that compete for the rapidly growing “discretionary time” of a population
His examples were bowling ball manufacturers competing with lawn care companies, but the idea is the same, go up an abstraction layer, and the competition is for time.
This is a restating of an older idea that fancy restaurants aren't competing against other restaurants, they are competing against movie theatres. Because they are in the date entertainment market
It's not really that weird.
People who uses dating apps are on a very specific mission (to get laid, a.k.a "to meet more interesting people"). They'll optimize their profile to specifically archive that goal.
TikTok accepts wider range of interest-based (instead of goal-based) contents, and have much wider demographic spread. On that platform, you show more aspect of you and your life to your viewers, and that creates a degree of trust and maybe even empathy, both are beneficial in creating a closer relationship.
And it's not just on TikTok, I first noticed the effect in online games. For example, people who act kindly often get a lot of friends, etc.
I read the comment about Tinder and Tiktok being in competition differently: To me they said that both Tinder and Tiktok are in competition over eyeballs.
Meaning for example that if Tinder shows me profiles I find less attractive, I'm more likely to churn to Tiktok. So Tinder will show me profiles of people I have no hope of meeting, to keep me engaged nonetheless.
Also, the pizza examples miss out the competition aspect. Pizza restaurants are competing against other pizza places, but also competing against other foods. If someone starts increasing the price and reducing quality of pizzas, then at some point people will start saying "I don't like pizza, let's go for a burger" and eventually a whole generation will grow up thinking that they don't like pizzas as they've only eaten crappy ones.
Ultimately, these kinds of things go in cycles with the population varying between choosing cheap and trashy products and choosing expensive, quality products.
I honestly felt like “wtf” reading those examples. Everything listed there as positives would lead exactly to user(patrons) retention. For dating apps it’s the exact opposite.
Read the pizza example, and was like "this guy is really clueless". Read the car example (car makers are incentivized to make cars unsafe!), and thought, "This ignorant fool needs to shut up." Car makers are incentivized to make unsafe cars, and before there was such heavy regulation, did so.
I think the point was that, yeah, auto manufacturers are incentivised to make unsafe cars...but in real life, they make safe(ish) ones. Pizza restaurants are incentivised to use the cheapest ingredients possible...but in real life, they have stopped somewhere above the absolute lowest quality. How can this be?
Pointing out one incentive is not a complete argument without an understanding of the broader dynamics. Auto manufacturers are incentivised much more strongly and in the opposite direction to make safe(ish) cars. Pizza restaurants are incentivised not to make pizza from reconstituted sawdust and rancid milk fat, for multiple reasons.
Then, goes the argument, if we are willing to regulate cars and abandon truly bad pizza restaurants, how come we put up with dating apps instead of e.g. deleting them and offering a $10k bounty to matchmakers, payable on our one year wedding anniversary? Why don't we ditch them? There must be more than just one incentive at play.
It isn't just restaurants, but also supermarkets.
They don't produce food; they produce shareholder wealth. That's their goal.
Healthy food, grown naturally, not sprayed with chemicals, harvested in the last week, is just not a cost-effective plan for them.
> Healthy food, grown naturally, not sprayed with chemicals, harvested in the last week, is just not a cost-effective plan for them.
It's not just "not cost-effective", it's not technically feasible.
Do you want to grow enough food to feed maybe a couple of dozen people and spend every waking minute doing it, or do you want to scale out to feed everyone including the vast majority of the population who do no useful work?
Not only that but there is no real evidence that organic food is better for you.
Even from an environmental perspective the arguments are dubious. The yields on organic food are much lower which means you need more land under production, land that could have been left to the wilderness.
> Healthy food, grown naturally, not sprayed with chemicals, harvested in the last week, is just not a cost-effective plan for them.
It's also not a cost-effective plan for most shoppers who have enough other expenses in their lives that they can't afford their food doubling in price.
Most of us are stuck in globally-horrible local maximums, and we aren't going to get out of them without some external push.
To push back on this idea a bit - my family buys a share from a CSA (community supported agriculture). Our CSA is a local organic farm operating on about 4 acres of land. They grow enough food for ~30 CSA shares and sell at farmers markets as well as to local restaurants. For $700 we get enough fresh produce to cover about 2/3rds of our groceries (for 2 adults) for a 20 week period. We spend a lot more than 35/week at Whole Foods typically! And this is in a relatively HCOL part of Colorado - which isn’t known for its easy growing climate.
All that is to say - I’m not sure I agree that supermarkets are the cheapest outcome for food. Locally grown food can be substantially cheaper. What we give up is the year long availability for any kind of produce we could dream of. Instead we eat seasonally and we eat what is available. It requires a shift in cooking practice from “I want to make X - I am going to go buy A,B,C ingredients” to “I have A,B,C - what can I make with this?”.
Maybe that lack of choice is an unacceptable trade off for some - for us we find it fun. It’s well worth cheaper, better tasting (really cannot understate this part), and substantially longer lasting produce. It’s actually crazy how long the produce we get from the farm lasts - we have basically zero spoilage now.
I just wish we could get food like this year round - and I am considering buying a second share next year entirely to can it. So maybe it will be possible!
In 50 years, the proportion of the budget allocated to food, halved.
I'm not saying everyone can have the choice to eat healthy, but probably a small majority has.
I live in an area where small, local, sometimes organic producers are gathered to sell their product to the community in a way it is accessible to every budget.
>I'm not saying everyone can have the choice to eat healthy, but probably a small majority has.
I bet the least healthy options in people's shopping trolleys are some of the most expensive items. Cakes, biscuits, chocolate, ice creams, alcohol, pre-prepared meals, etc.
i'm always a little surprised by how low my cart total is when i just go into the store to refresh a few produce items. that said, eating healthy certainly hasn't gotten any cheaper. i've paid $1+ for a single onion which feels absurd
There are very few areas where it's physically possible to live like that.
And even in those areas many staples will be industrially farmed and imported from other countries, or at least shipped from far away within the same country.
In 50 years, the proportion of the budget allocated to food, halved.
Did people choose to do that, or why they forced to by increased costs in other areas?
> In 50 years, the proportion of the budget allocated to food, halved.
Sure. But 50 years ago, healthcare and education didn't cost an arm and both legs. In those 5 decades, every single rent-seeker that you need to engage with to live has dipped his hand deeper into our pockets.
> I live in an area where small, local, sometimes organic producers are gathered to sell their product to the community in a way it is accessible to every budget....
You forgot the "For the brief period of time their produce is in season."
Only selling what you have, when you have it removes a lot of costs from food supply chains. If, like the local grocery, those small, local, organic producers had to keep you fed 24/7/365, their prices would go up - by a lot.
I am also pretty confident that those small, local, organic producers aren't the source of most of their customers' caloric demands.
I live in a part of the world where the healthcare system is also spread across the society in a more equalitarian way than what you describe.
I don't understand your second point. One of my close friends is a farmer, they mostly grow organic apples. They work (insanely hard) across the whole year to prepare the crop and take care of the trees. They are not rich, but it starts to be sustainable. Locally, it's having a community of farmers that grow different things that make you fed across the year, as long as you accept eating exotic food only very occasionally.
Regarding calories, I honestly don't know. What I know for sure is that apples in the 50s had at least an order of magnitude more calories than apples today. Different times, different agricultural practices, different population also, fair.
Obesity has skyrocketed across the whole world. People already eat too much, too much hyper transformed, too much sugar, too many calories.
> Obesity has skyrocketed across the whole world. People already eat too much, too much hyper transformed, too much sugar, too many calories.
Carbohydrates are way cheaper, but the distribution of nutrients you can get for any price has not gotten cheaper proportionally. Then you factor in choices, like paying rent vs eating healthier, etc etc.
>What I know for sure is that apples in the 50s had at least an order of magnitude more calories than apples today.
At least an order of magnitude more calories? Just to be on the same page, you're saying that apples in the 50s had at least 10x as much calories as they do today? :DD
You realize an apple is ~10-12% sugar by weight, right? The rest is just water and fibre. So an apple with an order of magnitude more calories would mean a solid block of sugar. (alternatively, an apple that's 10x the size, but we have photos of 50s apples, and they were roughly the same size as today)
Apples are an exception to the rule as they can be stored for a long time (up to a year for some varieties) under the correct conditions.
> What I know for sure is that apples in the 50s had at least an order of magnitude more calories than apples today. Different times, different agricultural practices, different population also, fair.
And you know this "for sure" exactly how?
The amazing 1000 calorie apple
> I don't understand your second point.
When I go to the grocery, food is available to me at any time of year.
Your friend's apples are only available for ~2 months/of the year. The supply chains that feed the world have to work year-round, and all the people that work them expect to get paid. Availability adds to the cost.
> What I know for sure is that apples in the 50s had at least an order of magnitude more calories than apples today
I have a very hard time believing that the average apple from the 50s had 94 * 10 = 940 calories.
Which is the whole problem. Your friend's apple orchard is not a replacement for the modern grocery. It's a seasonal supplement that replaces the cheapest and easiest part of a diet - in-season produce.
And he has to work insanely hard all-year-long to do it.
Overtaxation, less disposable income.
> So why doesn't a legitimately healthy restaurant come along and take the whole market?
The lesson is in revealed preferences. One of my friends, live him to death, has been trying to lose weight since forever. When we try to eat together, hell judge the food. Either what's in my pantry/freezer or from the restaurant we go it. He keeps talking about keto as well. He's pretty knowledgeable about things by this point. But he keeps being unable to lose the weight! Yet no matter how much he tells me or how right it actually is, the lesson is on revealed preferences, aka he's got a ton of dominos pizza boxes hiding out in the trash that he's been eating.
Losing weight is pretty simple. Just stop eating such much food. It's not easy though, unfortunately. That food is pretty delicious. All dating apps have to do, which coffee meets bagel was doing at back when, is rate limit the matches given to women. Let woman rate as many men as they want, but only show women the to p 15/whatever matches so they aren't overwhelmed. it's so obvious and simple, but hard to put into in practice, for reasons that have zero to do with anybody's ability to write code.
The article misses the most important factor: the customers have no way of knowing they would be getting a better product or extra 25 millimeters of leg room if they paid 3% more. The higher prices could just as well be for completely unrelated reasons (greed, inefficiency, ...). No one is going around measuring and documenting every single difference between products and services, and, even if someone did, almost no one has time to do such thorough research for every purchase. It is increasingly difficult to find objective information about any commercial product. Any attempt at providing impartial information gets drowned in an ocean of marketing content, sponsored reviews, astroturfing, and brand tribalism.
Consequence of the above is that marketing and anecdotal evidence are much more influential factors in purchase decisions than quality of the product. Using marketing campaigns to brainwash people is significantly easier (and cheaper) than improving a product enough for them to notice – especially if the product already has a zombie customer base that chooses a familiar brand out of habit rather than merit. We have built a world where money is valued over value, and making better products is often a terrible business strategy.
> Customers have no way of knowing they would be getting a better product or extra 25 millimeters of leg room if they paid 3% more.
If you search on Google Flights, the seat pitch is clearly displayed, or you can use third party tools like Seatmaps.
But many people use airline sites directly, don't understand or care, or as the article correctly asserts, care more about the price than anything else.
Even if the information is technically available, a business can sit there optimising for a specific problem while individuals have to deal with tens or hundreds of separate problems every day. We have to satisfice and finer details like this are usually ignored.
Not everyone needs extra space and for those who do the hourly rate for being in mild discomfort on an airline is huge.
It’s less that most people don’t care instead it’s often a completely reasonable tradeoff.
This is an example of the "information asymmetry" point.
The 'zombie customer base'explains much of everything wrong in today's society packed to the brim by stupid people. If you find yourself in the 98th percentile, prepare to be disappointed by just about everything available in today's society.
I'm certainly not in the 98th percentile yet I dislike buying "durable goods" because it's almost always a disappointment.
The article mentions light bulb durability. There was a cartel, the awesomely-named Phoebus Cartel [1] that encouraged its members to reduce the typical operating life of bulbs from 2500 hours to 1000 hours to increase bulb sales.
So the author's list of 'Why Stuff is Bad' should * certainly * include 'lack of anti-trust laws and enforcement'. Rent-seeking, anti-trust, regulatory capture should all be mentioned in this under-thought blog product.
Seriously, not mentioning useful regulation and standards as a countermeasure to the negative trends the author describes seems like willful blindness.
[1] Phoebus Cartel https://en.wikipedia.org/wiki/Phoebus_cartel
Bulbs with a shorter lifetime are also a lot more efficient, because they run hotter.
That's why that one bulb that's been burning for a 100 years in a firestation somewhere is only just glowing.
Heat is literally inefficient by definition - it's spent energy which hasn't been converted to visible light.
And hotter light bulbs produce proportionally more visible light (higher luminous efficacy) than cooler ones.
An electric heater at 100C is an incandescent light source with 0% luminous efficacy :)
Hotter _incandescent_ bulbs (e.g. tungsten wire, halogen, etc.) produce more light than cooler ones, but the heat is still wasted. That's why such bulbs are going away.
With non-blackbody bulbs (e.g. florescent, LED, etc.) the light is produced directly. Any extra heat is still wasted, but we can (and do) engineer to reduce it, thus making the bulbs far more efficient.