Power affiliates 2011
Welcome to the second edition of the Power Affiliates 50, eGaming Review's annual survey of the most powerful and influential affiliates plying their trade in the industry today.
Welcome to the second edition of the Power Affiliates 50 (click here for last year’s list), eGaming Review’s annual survey of the most powerful and influential affiliates plying their trade in the industry today.
While the criteria stayed broadly the same as last time “ monthly income and traffic, conversion from registrations to new depositors, and quality of website and traffic “ this year’s edition benefits from a greater volume of data from a wider range of sources. Payment processor Skrill, affiliate network Income Access, operators and, of course, affiliates themselves, all helped to provide a sounder empirical foundation to this year’s rundown of the biggest and the best gambling affiliates.
While research for this piece reinforced affiliates’ continuing centrality and importance to the egaming sector today, ongoing developments in the past year look set to pose challenges to the tried-and-tested affiliate model in the next 12 months. Paramount among these is the rise of regulated dot.country markets. Affiliates, after all, proved their value to the industry by acquiring customers in grey territories yet to formulate egaming regulations which characterised the industry’s first dot.com era. With operators’ ability to openly market and acquire periodically being disputed and constrained, this was where affiliates came into their own.
But with regulating markets imposing higher tax and costs on operators and forcing them to work off tighter margins, the deals affiliates enjoy in dot.com markets are unlikely to be replicated in the growing number of EU member states choosing to force operators to be licensed in order to offer egaming.
Nicky Senyard of Income Access agrees that the revision of affiliate terms and conditions, already started by several big brands in the past couple of years, will accelerate in these new markets.
“Affiliates can still promote in regulated markets but they may have less choice of who they promote, while those that promote the commission structures may or may not be equal to what they’ve experienced before, depending on the commercial approach the operator has taken.”
“Regulation has been damaging for us, says Casinoman’s Edward Yu, “and I’ve had to diversify our business outside online gaming.”
Regulated markets also represent opportunities as well as threats to affiliates, albeit those with deep enough pockets to build brands able to compete with large media players in France that Senyard observes “don’t want to incentivise or manage affiliates in the same way they’re used to”.
French affiliate Rue des Jouers, a new entrant to this year’s 50, is one such example of a localised super affiliate that can quickly rise in a newly regulated dot.country market.
Localised affiliates that dominate in a territory are of course already a dominant feature of the poker affiliate vertical, as reflected by the inclusion in this year’s poker list of Bulgarian giant Igrach.com (49% owned by Poker Heaven and Poker Channel owner Gaming Media Group) alongside Norwegian-based Donkr and Finland-facing Pokerisuvit.
Arguably ahead of the other verticals, poker has already felt the impact of the above-the-line brand dominance that online operators can freely establish in regulated markets and commentators argue will do away with the need for affiliates, at least on the same lifetime revenue share terms they enjoy today. Full Tilt and PokerStars last year moved to weaken their dependence on affiliates respectively by capping rakeback commissions and buying affiliate portals including PokerPages.
While acknowledging that Full Tilt’s move hit some other rakeback affiliates particularly hard (“some are 60-70% Full Tiltbased”), Karim Wilkins of RakeTheRake says it has been watching this change coming for some time, hence the diversification into initiatives such as sponsoring the English Poker Open. “The whole way this industry is going, you have to look at other things, if it’s just Full Tilt looking at new games like Rush Poker, if you are a RB affiliate, you have to look at other things outside of rakeback, maybe at doing CPA.”
Plenty of new opportunities still exist for affiliates in emerging markets, argues Senyard. “There is no common route to market. If you own a land-based casino in Eastern Europe then you’re going to market and use affiliates in a very different way to a media player. 2011 will be an amazing growth time, more markets will open up and I can see another surge in affiliate traffic due to new markets. But you’re going to have to be more pragmatic, there’s no more gravy train.”
Affiliates are also leading the way in developing social networking sites as a major acquisition channel. Mainly through integrating the free bingo model with Facebook, while casino affiliates are also busy building conversion databases of potential new real-money players for when the US comes back online.
And as proved by those super affiliates who have successfully continued to grow their businesses by becoming operators or white labelling their sites, those able to adapt to the new conditions in Europe and “prepared to do the hard work”, as Senyard puts it, will surely follow in their footsteps.
Read the top affiliates in bingo here
Read the top affiliates in casino here
Read the top affiliates in sports betting here
Read the top affiliates in poker here