As to your bulletes points:
- Tinder is owned by Match Group who - before Tinder - spent 20 years building a paid acqusition machine. In order to do paid acquisition you have to deeply understand the LTV of your users. That methodology, refined iver years at Match was ported to Tinder (just read Matchs earnings calls). While Apple has access to all ybe transaction data of apps on iOS, so do then defelopers, who are highly resourced and highly motivated to understand their LTV/CAC. So no, I dont believe for a second that Applr has an advantage here. And even if they did, applr only collects 30% of the revenues - how could they ever guy profitable when bidding for the same slots as the developers who Are getting 70%?
- Capital - nope. Match produced close to a billion dollars a year in cash flow. HBO billions. Capital isn't an issue for either of them.
- I disproves this hypothesis with the LTV illustration above. To be clear: Theres no scenario where apple can be profitable on this spend when they can only ever get 30% of what the consumer spends.
a) They can click through to a Tinder site, where they subscribe directly.
b) They can click through to the App Store, where they end up subscribing via Apple's in-app purchases. Apple gets a 30% cut.
Assuming your $100 LTV from before, in (a) Tinder makes $97 and Apple makes $0 while in (b) Tinder makes $70 and Apple makes $27. Tinder clearly prefers (a) while Apple prefers (b), but by how much?
Tinder: they make $97 - $70 = $27 more in (a)
Apple: they make $27 - 0 = $27 more in (b)
This means both companies are willing to bid approximately the same amount, since their profit on winning, relative to what would've happened otherwise, is $27.
Any marginal conversion that Tinder creates (either against a competitor or non-consumption) is worth over $50 net to them using Apple payments. ($50 would assume a generous $20 marginal cost to serve.)
That doesn’t mean that the data that Tinder’s ROAS team is looking at will guide them to spend more than $27 in this case, only that it might.
Likewise Apple could spend $27 on every customer they converted who was already going to be paying Tinder on the web to buying via the App Store plus $27 for every user they added to Tinder who paid on the App Store who would have not bought or would have gone to a competitor (minus any credit Apple would have earned there) plus an amount of cashflow and enterprise value created by people seeing ads for Apple’s store and concluding that Apple has more/better apps than their competitors.
If we confine only to first-order effects and assume advertising is exclusively about changing payment preferences of users who would convert anyway, I’d expect both companies to be willing to bid close to $27.
I mean, maybe if tinder's margin was less than apples, but that's pretty unlikely.
If they’re both bidding on the same keywords, which they are, then the price of the keywords is the same to each of them. It’s an auction, so whoever bids the most will win the auction. The developer can spend up to $97 to bid on that keyword and still be profitable or at worst break even, while apple can only spend up to $30 to stay profitable or break even. So if Apple is winning auctions, it means they’re spending more than the developer, despite having less than half the purchasing power of the developer. So they’re spending negatively almost no matter what.
* Apple has a higher LTV estimate than Tinder for this traffic.
* Tinder has less available capital, so they are not able to outbid Apple even though they think that they would still earn lots of money at that price.
* Perhaps someone who is looking to subscribe to Tinder is likely to succeed even without advertising, but without Apple's ads it won't be via Apple's IAP. The amount it's worth to Tinder for a subscriber to come to them directly instead of via Apple and the amount it's worth to Apple for a subscriber to come in via IAP are about the same.
(Disclosure: I work on ads at Google, but not search ads. Speaking only for myself)