Q&A: partypoker boss Tom Waters on returning the brand to former glories

In 2015, the bell tolled for one of poker’s trailblazing brands – partypoker. Bwin.party management had instead chosen to prioritise the core sportsbook offering and partypoker was cast out in the cold with no budget for product development or marketing initiatives.

Indeed, Kenny Alexander, CEO of GVC, which snapped up bwin.party in 2015, pulled no punches in his FY17 results presentation when he declared that partypoker had been “very, very poorly managed” before the acquisition and that the previous owners paid “zero attention to it” and were “letting it die”.

But Alexander, alongside group head of partypoker Tom Waters, initiated a plan to return the brand to growth by scrapping its failing strategy and introducing a detailed plan to get the poker site back on the map. Net gaming revenue soared 42% in 2017 and first-time depositors grew by 25%, while the brand has undoubtedly become the biggest challenger to the vertical’s long-time runaway leader, PokerStars.

So how have they got partypoker – the world’s largest poker site prior to UIGEA – back in the game?

EGR Intel: Kenny Alexander said partypoker had been left to die. Why was it left in such a sorry state?

Tom Waters: In 2015, partypoker was in turmoil. The biggest factor was the bwin.party merger as there was so much focus on sport. When two companies merge, management are responsible for delivering certain synergies and partypoker slipped down the pecking order because it made sense to focus on the sporting core of the business. Partypoker was in freefall at that point. For a number of years, poker received very little in terms of product development or marketing support. Questionable decisions were made in the past which contributed to partypoker’s downfall, but the primary reason was lack of investment.

EGR Intel: Which poor decisions contributed to the demise of the brand?

TW: An example would be the introduction of withdrawal fees. That was put in by management to try and balance the ecology as they didn’t want money leaving the ecosystem. Obviously, it was a bad decision, so we recognised that and reversed it. A lot of players said they stopped playing with party because of that – they felt the players were being betrayed.

EGR Intel: What lessons have been learned from the neglect of partypoker?

TW: We had to look at what we had done wrong. Why didn’t players want to play anymore? Why are we losing so many customers and why will nobody come back? We knew the product was weak and we needed to address that. We had effectively lost the trust of the poker community and we became known as a place to play poker only if you absolutely had to.

EGR Intel: How did partypoker switch from turmoil in 2015 to a 2017 net gaming revenue rise of 42%?

TW: We changed the entire strategy behind partypoker, which previously was to just try and get by. We were told not to suffer [tournament] overlays and just to retain the existing players. It was never going to work, so we stripped everything out. We had a weak live offering at the time, so we signed a deal with [Nottingham poker club] Dusk Till Dawn in order to focus on the UK market.

EGR Intel: How did partypoker win back player trust?

TW: We tried to get closer to the community. We have built up a new pro team to open up communication channels for the community as well as to talk to them directly. I go to as many poker events as I can, I sit and play and talk to the other players to find out what’s going on. We also scrapped the inactivity fee last year. Before, if a player hadn’t been on the site for six months, we would charge a €5 fee, so we removed that. We felt that what we had done was wrong and now we are trying to do the right thing by players. If we’re not offering them a decent service where they enjoy playing, they won’t play poker with us because there are alternatives. We have to be different and look after our customers, as well as try to win back the ones we lost to the likes of PokerStars and 888 through bad decisions.

Partypoker’s Tom Waters

EGR Intel: Can partypoker challenge PokerStars as the go-to poker platform?

TW: I think partypoker is now comfortably number two in the market. We are guaranteeing £40m across Powerfest – Stars has £65m for SCOOP and 888 has £4m in their Super XL Series – so I think that shows the gap between the companies in terms of what we offer for tournaments. But 18 months ago, Powerfest was offering just £3m in guarantees, so it has grown from £3m to £40m in the space of two years and we are incredibly happy with how we’ve grown. The structure is great and we are trying to cater for everybody by adding variation.

Can we topple Stars? Possibly, but they are so big and have such a stronghold on so many markets. They have enjoyed dominance for such a long time, so it will be difficult for us to break player habits and get them to move across. We’ve achieved that to an extent because of the growth rates we are seeing but the question is how far we can go and how much we can release their grip on the poker market. We are confident that we can maintain our trajectory and we want to get as close to PokerStars in terms of liquidity as we can.

EGR Intel: Why does partypoker use poker pros as brand ambassadors instead of established sports stars?

TW: Poker pros like Patrick Leonard and Sam Trickett have a major channel straight into the community because they have a big following and people respect those guys, so they are valuable to us. For sporting ambassadors, we only really use Carl Froch and Boris Becker and they just help us widen our reach. I would personally never spend a huge amount of money on professional sports ambassadors because I don’t really see the value for us as a company to help deliver our strategy.

EGR Intel: What is different about the partypoker rewards scheme?

TW: Looking at loyalty schemes across poker and the gaming industry as a whole, they have become very complicated. When I look at the schemes out there it is often very difficult for me to actually work out what I’m getting and our previous scheme was the same. People had to do various different things and jump through hoops to get points, but it was very difficult to work out what you were meant to be receiving. We wanted to change that and introduced a very clean, simple rakeback mechanism. Now all party players know as soon as they sit down at a table exactly what they would be earning in terms of rakeback. Every Monday morning that is paid into their accounts in cash.

EGR Intel: Does online poker have a future?

TW: It is definitely not dying. It has been stagnating for a few years but that is partly due to the lack of competition for Stars. Now we are moving into a world where PokerStars, us and 888 are all challenging each other and there is healthy competition as we are trying to do something different. From Stars’ results we can see that shared liquidity in Europe is already benefitting the market and the general poker market is primed for growth over the next few years.