These days, Ashley Madison doesn't have to cheat to get ahead.
So says Rob Segal, who has worked hard to refocus the site's image and rescue its reputation since April, when he left WorldGaming to join Ashley Madison's parent company, Ruby Corp. (formerly Avid Life Media), as CEO.
Launched 15 years ago, Ashley Madison became famous (some would say infamous) as the go-to online resource for users (mostly men) seeking partners (mainly women) for affairs. Disaster struck in July 2015, when a breach of its database exposed the identities and information of some 32 millions users, tarnishing the brand's "good" name. Plus, Ashley Madison itself had been cheating: many of the "women" on the service were in fact bots deployed by its sales force to deceive men.
Some doubted Ashley Madison would survive, but ownership banished the bots and shored up security to thwart future data hacks. (The site implemented more discrete credit card processing and stricter monitoring procedures.) And the board hired Segal, 49, a marketer by trade, who launched a big push to reposition the service as a lifestyle brand and social network for folks open to exploring aspects of human sexuality, from swinging and group sex to BDSM.
Despite ongoing challenges, including an FTC investigation and a major class-action lawsuit, Ashley Madison is gaining users, and Segal believes the future looks bright.
Adweek: What was your initial reaction when you were contacted for the CEO job?
Rob Segal: I would be lying if I didn't say I had trepidation on this. I did think that if it could be pulled off, it would be one of the great turnarounds of all time, and I wanted to be part of something that big. I like building companies, I like resetting cultures, and I love advertising, and I was also intrigued by the idea of being a client for the first time in my life. By that I mean having my own company, my own product and my own budget to market it. I had to get comfortable with it, and I had to make sure it was cool with my wife and with my family.
In Ashley Madison's July ad campaign, you dropped the "Life is short. Have an affair" tagline in favor of "Find your moment."
We were trying to reposition away from a very shock-and-awe approach, a misogynistic approach that was, really, just focused on infidelity and cheating. I thought that it was narrow, and that the ads had to really speak to the user base, and address how the customers were actually using the site. Many of the customers were single (45 percent), and the ones that were in relationships were looking for others (often in couples, who were open to sexual experimentation). So, I guess you can say it was moving away from an affair boutique to a department store of open-mindedness.
How's that working out?
We gained 7 million members since July, taking our total over 49 million. But also, one of the things that we think is really positive is that our female sign-ups are up 20 percent.
Can you describe the typical user?
With 49 million, you span a wide range. But if you look at our core users, they would be in that mid-30s and older range, and they would be higher educated and higher income.
How do you monetize that base?
We get roughly 20,000-plus sign-ups a day. As we continue to improve the messaging and the user experience, you can expect more and more of those to turn into paying customers. It's free initially, but as you want to use more of the service, you purchase tokens (which start at $49), and you become a paying customer. (They spend an average of $200 a year on the site.)
That's an attractive base for marketers. Can you envision selling ads on the site? Big data's a very untapped opportunity for us—but we have to be very, very careful with how we do that. We would never share any data about a customer. That would be counterintuitive for us at this stage. What we do have is traffic, and we have a lot of people who aren't customers that are intrigued and take a look. In the coming year, we will explore that data—and, obviously, keep it quite secure and private—to understand the demographic, and the usage, and the behavior, and then potentially work with other people. In a year or two we might be there, but not right now.
Can you talk a bit about Ashley Madison's sibling brands?
Cougar Life is a site for women who want to explore their desires and fantasies, and generally it's with younger men. Established Men is more along the lines of a site for older gentlemen that want to meet younger women, not necessarily to launch a relationship, but if they have a hard time dating.
Are you doing ad campaigns for those properties?
We've got really cool Cougar Life stuff coming up in the next few weeks. Cougar will likely have television, but our focus is digital—search and social. So, Cougar will be our second biggest behind Ashley Madison. Established will likely be grassroots, digital, experiential—you'll see that work in 2017.
Where do you see your brands in the next few years—what's the path to growth?
We need to continue to build up trust, to firmly entrench ourselves as the leader in open-minded dating. We'll position the sites as nonjudgmental platforms, with the customer base to help you find whatever it is that you are looking for in a discreet and secure fashion.
This story first appeared in the November 28, 2016 issue of Adweek magazine.