This will lead to wins that will be visible in financial results and metrics in the back half of the year. A big initiative for Tinder is to cater to Gen Z through a series of initiatives around authentic content and self-expression. We have some really creative and interesting features that we’re currently concepting and we plan to integrate into Tinder. We’ll be talking more about that as the year goes on. Another place that we think Tinder can really change the game is by leveraging machine learning to enhance recommendations. We’re already using machine learning for safety and moderation. And that technology is really improving, and I think it will be very beneficial when applied to . We have resources inside the group that we can leverage to build this technology out, and it’s something that we’re working on in 2023.
Not only do we have these resources at Tinder, but Hyperconnect also has a significant team of machine learning talent that we think we can utilize to move faster in this area. You asked about pricing optimization, and I believe there’s a lot of low-hanging fruit around optimizing pricing. We haven’t been focused in this area for a long time, and we recently put our best talent from Match Group against these initiatives. We have a lot of confidence that we can achieve significant revenue improvements by tackling this area. This actually reduces the risk and improves our chances of delivering our financial targets. So I feel really good about the fact that 2/3 of Tinder’s 2023 revenue growth is delivered by just product pricing and product optimizations.
Lastly, we plan on broadening monetization to meaningfully unlock power users at Tinder. This is an area that we see a lot of opportunity. Last year, we acquired The League, which has a $1,000 weekly subscription. And we think there could be a demand for a high-price tier at Tinder, which is the largest pool of daters on the planet. We’re in the very early stages of testing the appetite for an ultra-premium subscription tier at Tinder. It’s too early to say when and if we’re actually going to launch this, but the possibilities are super intriguing.
Operator: The next question comes from Lauren Schenk with Morgan Stanley.
Lauren Schenk : Great. You mentioned in the letter that the year is off to a solid start performance-wise. Just wondering if you could expand on those comments and what you’re seeing specifically? And is the improvement broad-based or specific to some brands or regions? And then just maybe following up on the last question, what are some of the KPIs or trends that you’re seeing internally that give you confidence in Tinder reaccelerating to mid-teens revenue growth by the end of the year?
Gary Swidler : Thanks, Lauren. Why don’t I try to take that one? So when we met on our last earnings call, we told you that we are seeing significant pressure on our ALC revenue, which was really driven by macro factors, particularly younger consumers that were feeling pressure from the economic environment. And that was especially acute at our Tinder brand where we have a lot of younger consumers. That impacted our Q4 performance, and it was also really a potential overhang on our 2023 performance as well. But since we met last time, a couple of things have happened. The first one, which BK mentioned, was that Tinder put out a lot of initiatives to reverse the trends in ALC. And you can see from the chart that’s in the letter, they did succeed in reversing a lot of the decline we are seeing in ALC, not all of it, but a significant portion.
