They discuss “thick” and “thin” markets, and the need for a “thick” market in order to achieve success. I’ve often felt that not enough marketers spend enough time on dating sites as a way to really understand human interaction and UI. There seems to be some kind of stigma to researching in the online dating space, which I don’t really understand…
Here’s an excerpt from the interview — grab a copy of the book.
SIEGEL: Well, the subject that Elise Hu was reporting on is one that you address in a chapter called “Thick Versus Thin Markets.” What do thick and thin mean, in this case?
OYER: Well, a thick market is one with a lot of participants. And so you want your stock markets to be thick because then it’ll be easier to trade, there will be more supply and demand; and we’ll have a more efficient market where transactions will be easier, and nobody will feel they’re getting ripped off. Now in the online dating world – and the job market is exactly the same – we want a thick market because we want better matches. And I want to go to one that has a lot of alternatives because I want people who are closer to what I’m looking for.
SIEGEL: But what about a very thin market, I guess, which would be people-in-search-of-relationships-with-economics-professors.com?
OYER: Well, that the niche site I’d like to see him try to get going…
OYER: …for my own personal reasons. But I wouldn’t invest money in that. And so these niche sites can be very useful, if the niche is big enough. So the site you just laid out and other ones like, there is a gluten-free site and there’s a tennis site that I tried, I think those niches are just too small. The niche sites that have done very well are the ones where the niche is big enough to create a thick market. So Christian Mingles has been very successful, for example.
SIEGEL: Now, in your chapter on thick and thin markets, you manage to go from online dating services to work on how hospitals hire gastroenterologists. I want you to explain the connection there.
OYER: Well, so the gastroenterologist market every year is exactly like the dating market. At the end of a fellowship, a gastroenterologist will go looking for a job. And there are hospitals out there that are looking for gastroenterologists. So it’s a job market that is very much like a – online dating site, in some ways. Now, it’s a very thin market. There are just a few hundred – I forget the exact number – gastroenterologists who become available every year.
In some years, when supply of gastroenterologists is particularly low, the market breaks down. It’s just too thin. And somebody has to come in and fix the market from outside, rather than let supply and demand naturally do it by itself.