Phone Dating (Phone Chat) Business Basics

The conversation usually starts out about the same way. Someone has been researching the phone dating business for a while and wants to find out what is involved in starting one.

By the time potential customers talk to someone from my company, they may or may not have spoken to a few of the competition. Phone dating software is a very small niche market. There are only a handful of companies that sell phone dating software. Regardless who new prospective clients speak to, they eventually get a quick lesson on the market. Some of the points of discussion usually center on:

• Startup costs

• How they can make money

• What exactly is required when it comes to software and hardware?

Startup Costs:

While different providers of phone dating software may charge differently, generally costs revolve around licensing per port (caller). Each person who can call into a phone dating system and exchange voice mails, listen to and browse ads, or chat with another person simultaneously requires a port (phone line). In other words, if someone sets up a dating service and expects 50 people to be able to browse ads at the same time, the client would need to purchase licensing for 50 people.

Much like a fax card or modem you might put into a computer, phone dating systems use specialized hardware. The hardware is designed to handle 4, 8, 16, 23 or more callers at the same time. Costs vary with the hardware. The good news is that it is possible to purchase it used through EBay at a fraction of the cost of purchasing new.

If the customer does not have a computer that is suitable (fast enough, enough storage, etc.), then it may be necessary to buy a new computer.

Phone service must be ordered. Depending on how many people the client wants to be able to handle, different types of service may be needed. The software vendor can help with phone service questions.

Marketing will be the biggest expense in the business.

If the client wants to be able to access his/her service from the comfort of home, an internet connection will be needed.

How they can make money:

With most software programs, it is probable that the client will be able to charge by the minute, voice mail, week, month or any combination of these. The methods that the client chooses would depend on their business plan. Clients should put together a business plan so it’s known who their customers are, how they will reach them, and how much to charge.

What exactly is required when it comes to software and hardware?

Each vendor's product is different, but one of the more popular manufacturers of phone hardware is Dialogic (Intel). The quality cannot be beat. The cards rarely fail and that is the reason why there is a huge market for used cards on sites such as EBay. People upgrade their services and buy bigger and better. The hardware they had then goes up for sale for another company to snap-up.

So where do we go from here?

After new prospective phone dating clients get questions answered during our phone conversation, they will likely need to go back and do more research. They need to find out how much phone service will cost, they might need to write that business plan, or they might need to rethink their whole marketing idea.

To be successful, dating services need to find a niche market. Some set up straight or gay sites. Others choose niche markets such as Hispanics.

I often ask very early on what the population is of the client's target market. If it is less than 250,000 people, I will not even attempt to go any further. Ideally, one should choose a market that is big enough to provide plenty of customers. The only problem is that those markets likely have more competition, it costs more to establish the service because there are so many more callers, and trying to figure out how to get to the customer can be very difficult and expensive. A lot of trial and error might be necessary.

Ultimately, if the software vendor and client have done their jobs and homework, a system will be up and running within a few weeks or months. It makes sense that people calling into a new service are not going to pay if there is not any traffic. I usually recommend to my clients to run their service for free for a few months, or however long it takes to get a few thousand accounts (3-4K). The reason for this is that once the service starts charging, a certain percentage of the phone dating customers are going to stop calling instantly. The free ride is over and they will move on. A percentage of the remaining callers will become members and pay for the service. Most phone dating services do not charge the women, since they are what is bringing in the guys who are willing to pay for the service. Those guys will become the profit center for the phone dating business.

Of course, small changes may be necessary after a service is up and running. A change in methods of charging might be necessary. Perhaps the client will decide to expand because his service is getting really busy. Regardless of the circumstances, be prepared to go with the flow and act quickly. Since the point is to grow and make money, putting some of the earnings back into marketing and infrastructure will likely be a great idea!

For more information on starting a phone dating service, please see www.bestsoftworks.com. Article (C) 2007 by Softworks International, Inc. This article may be shared or distributed on the internet so long as it is not modified in any way.

Softworks International has more than 8 years experience in the phone dating (phone chat) industry.

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