a2b marketing – a strategic role reversal

MAY 2009 – Affiliate conferences are always rife with a murmuring undercurrent of speculation on the state of the online gambling industry. The recent Amsterdam Affiliate Conference was no different, but from my point of view, there was a heightened mood of optimism in most every conversation I had in Western Europe’s Sin City.

Has a corner been turned in the iGaming affiliate world? Well, if the two days I spent at the RAI Centre were anything to go by, I would have to say yes. The key word has to be progression. Full marks to the guys at iGaming Business for this in my eyes. Having the conference outside of the city centre brought a more relaxed atmosphere and marginally fewer hangovers – in fact all my meetings happened on time!

One thing I have taken away from the latest conference – my first as an independent consultant – is the notion of an increasingly irrevocable role reversal in iGaming affiliate marketing. This touches on something that, in a roundabout way, I’ve been drumming up support for over the past year; essentially how affiliate marketing can dictate the course of gambling’s public reputation in sceptical markets.

At this stage I should probably elaborate on what I mean by a role reversal. What I’m beginning to see is a tangible education of the operator/affiliate program by, largely, super affiliates. Don’t get me wrong; there has always been a flow of information from affiliate to affiliate manager through to the operator’s board level, but in the past this has been somewhat transient and taken rather too sparsely by gaming operations, meaning that marketing strategies have not deviated from the accepted norm because of it.

Following a conversation with the guys at PokerStrategy.com, whose system is essentially ideal for operators looking to developing lapsed customer databases or wishing to cross sell to a poker product, my opinion is fixed that affiliates have the power not only to drive traffic and spark lapsed players in to helping the bottom line, but to change the focus of the bonus driven marketing that does so little to endear online gaming to the global public’s conscience.

That all being said, the PokerStrategy.com system allows speedy profit for both affiliate and poker room. Building the brand reputation of ‘online gambling’ using more critic friendly marketing strategies for most affiliates and programs will, generally speaking, not provide such immediate returns as this formula, or indeed existing practices, but will work to ensure the longevity of online gaming and establish an extended pattern of growth in the years to come. And it is the affiliate who can lead this.

“PokerStrategy.com has a phenomenal, unique system that includes a bonus offering”, I hear you say. Well – true, but the core focus of the site is on educating the player and the outbound link formats reflect this. This is something a lot of affiliate portals focus on, but at the end of the day, most banners and links on these sites focus on selling the product to a prospective customer using a bonus offer, normally with as yet unspecified wagering requirements. The aim of this piece is not to confront the possible deceit in this marketing tactic, but to address what the affiliate community can do to get away from this approach, which at some stage will stop being sustainable.

At present there are a lot of people making a shed load of money using bonuses to sell gaming products. The operators themselves are reaping the rewards, which goes a long way to substantiate why this strategy remains so popular. It’s been fantastic up until now, and will undoubtedly be so for another couple of years. With this debate in mind, affiliates have taken the view that profit sharing deals offer their business sustainability in the long term and that CPA payment options are very much the short term measures.

Certainly, this is a more than understandable approach to have taken, but the potential for affiliate marketing lies way beyond the prominent revenue share package available at almost every affiliate program. To hark back to my ongoing case study, the relationship that PokerStrategy.com has built with operators and poker networks puts this particular affiliate in a dominant position to mediate between operators encouraging them to demonstrate and promote a spirit of healthy competition, and to work to establish a balance in poker network ecology. In my eyes, PokerStrategy is working A2B (A=Affiliate!) to ensure that, along with their business, the future of B2C marketing is a bright one.

To define A2B marketing, the affiliate (or affiliate community) leads the operator (or operator community) to develop marketing strategy, encourage healthy competition and work on balancing market positions behind these strategies and ensuring they are interlinked rather than on top of one another. This will provide players with plenty of playing options to suit their needs and reduce the necessity for casinos and poker rooms to compete aggressively on bonus offers, if eventually at all. This would allow us to arrive at a position where the industry can ecologically grow as an entity and the affiliates can then promote differentiating products, selling them on a far more experiential level than a bonus-orientated flash banner ever could.

So how do affiliates construct this position? It’s all well and good lauding the direction that affiliates such as PokerStrategy and Casinomeister provide to operators. These are two of the most highly successful affiliate operations around, so naturally they’re more likely to be listened to than the average affiliate. On the immediate face of it, how would it be in the operator’s best interests to listen to every run of the mill affiliate and follow their lead?

As an initial step, affiliates need to focus more on their product and system. Many will have already taken the step to ensure that their site is differentiable from the next, but what they may not have done is focus on a new way to sell the products they are promoting. Writing page after page of content for players is all well and good, but if you’re simply going to sell a casino through a banner placement or listing its bonus offer, are you really providing the differentiation that many players are looking for? To be fair to you, players know what they know, and many are now well tuned in to the ‘fact’ that the poker room with the best bonus offer is the best choice for them. Selling a product like this doesn’t appeal to every player who hits an affiliate site, but more importantly, and with longevity in mind, the thought of even visiting the site doesn’t appeal to a hell of a lot more people thanks to the reputation online gambling commands, partly courtesy of this approach.

So what do you do as an affiliate? Pull down all those juicy bonus offer banners and remove those promo codes, no doubt reducing your next month’s revenue and causing you to drop down an affiliate program’s wine and dine list? As A2B marketing takes shape, the thought of doing precisely that may not be so farcical. However, this gradual thought development is the tricky bit and unquestionably requires some good old fashioned union work.

Naturally, I’m referring to our old friend, the affiliate community. This is also why the effects of the recent upheaval in and around the major affiliate forums and the eruption of new communities must be overcome. For the concept of A2B marketing to be successful, affiliates simply have to work together. If they are conversing on different forums and meeting at different trade shows, it will be nigh on impossible for a common goal to be agreed on, or even for a need for that goal to be realised.

Moreover, a unified affiliate community, brimmed full of super affiliates through to newbies, united by cohesive and constructive ideas is going to get the attention of a major operator, and subsequently the gaming community as a whole. And if a bandwagon is fully loaded, there is no reason why it shouldn’t ride roughshod over wider public notions of online gambling and change the way our industry is perceived internationally, meaning we can all continue to grow!

With the power that search engines give and courtesy of their SEO efforts, affiliates hold the gospel of information to spread to players, no matter the arguments and figures poker rooms, casinos and sportsbooks may front up. Affiliates must, as a community, look beyond what will eventually be unsustainable growth and step up as agents of change to lead operators (who let’s face it, have set-ups that would change direction like an cargo ship if left to their own devices – largely down to pure staff numbers and their insistence on pointing to past success) towards less self-consuming marketing strategies and a well-balanced industry that can grow in more diverse directions than promotional one-upmanship.

At some point in time, there will have to be an event that is stringently focused on formalising and carrying out this thought transition. It will, of course, be essential that the major players are singing from the same hymn sheet, which will never be easy to achieve, but why not give it a go?


the affiliate community landscape – what happens after sorry

MARCH 2009 – In my article in a previous edition of Inside Poker Business, I made reference to how affiliate programmes and the affiliate community should take a leading role in developing online gaming’s corporate social responsibility. This belief has not changed, but the dynamics on which this process was scheduled to rely have hit significant snags since the time of writing.

Recently, I watched a Panorama report styled What Happens After Sorry, which attempted not to dwell on the mistakes made by senior figures at the top of HBOS and RBS in the run up to the banking crisis, but instead tried to galvanise both industry and popular opinion over what the future holds for banking, society’s opinion of it and most importantly, our money. In the end, despite the directive of the report, the honest fact of the matter is that, still, people were more focused on pointing the finger of blame, rather than coming together and agreeing on a path to recovery. Much should be learned from this stagnant approach that all-too-often prevents struggling areas of commerce from rallying together and moving on.

As such, I do not wish to dwell on the happenings at and behind one of the affiliate industry’s leading forums. The truth behind the CAP ordeal is now very much irrelevant to 99% of us. What is more important is what happens next. Where does the future lie for the online gaming affiliate community? What do we want to emerge from all of this?

In a sense, the affiliate world should consider itself fortunate to have the opportunity to reflect on what has happened and to work past these short term hiccups and to once again look at the long term goals of the online gaming community.

The wonder and the excitement I’ve found with working in the online gaming affiliate industry has been its lack of formal regulation and the boundlessness this creates. It’s what the internet is all about. In comparison to more stringently monitored components of the gambling industry, this has meant that the affiliate community has not only ridden the backbone of online gaming practice, but has driven it in many facets. Behind this foreward thinking has been, to date, two prime stakeholder groups – the affiliates and the affiliate programmes or operators. As a byproduct to the obvious business link, there is natural disagreement and confrontation. This is where the forums have come to the fore. Working as a vital cog in relationship development and management, forums such as CAP and GPWA have provided an invaluable tool for the affiliate community to construct a practical code of conduct. More importantly the community has used them to harness working methods, new ideas and opposition to restrictive legislation. Up until recently, there was no substantial stake holding that blocked this tool from working to its optimum. With this changing and other upheavals in mind, the gauntlet has now been thrown down to those in the affiliate community wishing to take up the challenge that has been so ably managed for a number of years (and in no way am I ruling CAP out of the reckoning here). However, this opportunity and the responsibility it brings need to be fully understood.

The affiliate community must not forget the virtues that CAP as a forum has had to date and the bonding nature its posts and threads have inspired. Affiliates and affiliate managers who have taken steps to open new forums and run separate events must do so with a long term mindset. They must also resist temptation to pitch them as rivals to CAP, GPWA or PAL, who in turn must do the same. Now, more than ever, if we are to see a host of new forums emerge and grab a foothold in the market, they must work together to rebuild that community spirit which binds the self-regulation that has put affiliate marketing in such a well respected position in the online gaming industry. The online gaming industry needs this to happen – indeed I need this to happen, if my hope for the affiliate industry to spearhead corporate social responsibility strategies is ever to be realised.

Is there a need for new forums? Well, to put it bluntly, no. What there is a need for is a catalyst to glue what has been broken back together again. The likelihood is that the opening of new forums will only lead to polarisation of opinion, rather than binding it into one driving force. As for affiliate programmes coming together to run an affiliate forum, I cannot see this materializing, and I hope it does not. I have put my name to an attempt to ensure that a certification pricing structure is fair to all parties concerned, but with regard to a forum, and more events, it just won’t work. Running a successful affiliate forum requires integrity, diplomacy and experience, dare I mention an aversion to conflict of interest. The latter would automatically render a programme-run forum unviable. Who would run it? Will problems regarding one of the moderating programmes ever surface on the message boards? I’m afraid it just doesn’t add up to common sense.

The same has to go for affiliate events. Perhaps more than the forums, conferences require industry harmony in order to be successful. With two Amsterdam shows running so close to one another in March and May this year, stakeholder groups are already being forced to choose one or the other, meaning the likelihood of attendances being half what they should be at each event, therefore reducing value for exhibitors and affiliates alike. This clash will hopefully be a one off and lessons have to be learned from it. The industry does need conventions like CAC Amsterdam and CAP Euro, but, like the forums, they need to work together rather than against one another, and need to be beneficial to all involved.

Whatever happens after sorry, the online gaming affiliate industry must initially stop the finger pointing. Secondly, it must harness a school of thought that has the ability to rein in those who seek to start their own communities, and ensure that, at a fundamental core, everyone is working towards a common goal. At present, that goal has to be working together to broaden the online gaming landscape and doing everything possible to evoke a more positive popular opinion of online gaming. How this all comes about is the million dollar question. With any luck, the sensible voices in the industry will be heard over the loudest, and we can all get back to business.

affiliate programs and corporate social responsibility

FEBRUARY 2009 – With the speed at which online gaming has grown, organisations within the industry have needed to mature quickly. As profits have taken leaps forward year after year, the corporate focus has rightly been on ensuring this particular growth pattern develops. A lot can be missed in a company’s formative years, so much so, that most online gaming companies have developed a corporate philosophy (as well as a business philosophy – and there’s a difference) that revolves, mostly unwittingly, around profit-making, no matter what their official stance may be.

Industries dealing in the levels of profit and growth witnessed in online gambling tend to be far more mature and have employed a particular strategy that is currently paying significant dividends. If you take the banking and finance industries as a general entity and compare them somewhat loosely to online gaming, the recent hit experienced with the credit crunch has seen many huge operations fold and others forced in to administration or merger. However, the survival of many and the subsequent bail outs that have occurred globally owe a fair bit to corporate social responsibility (CSR) policies put in place by many of the City’s flagship operators.

Whilst most online gambling companies meet license, legislative and security requirements when it comes to operations, payment handling, fraud and marketing, few take the extra step to exceed this and obtain what is known as corporate citizenship. The nature of online gaming is not ideally set on acquiring such a status, but it’s arguable that stockbroking and share dealing could be seen in a not-altogether different light. Yet because of the groundwork put in place by the City and other global financial centres, even now, they are not and confidence in the banking industry remains strong. Membership of and compliance with organisations such as eCogra and Gamcare are certainly worthwhile, but essentially fulfill license requirements, rather than provide that big stride into proactivity.

There are arguments against taking the step to becoming ‘corporately responsible’ – not least as it refocuses at least a portion of efforts towards the long term, hence detracting from critical short term operational targets. William Hill has recently offered to donate money to Breast Cancer Care for every player that deposits and plays up on their bingo product. Critics concerned with corporate hypocrisy and insincerity generally suggest that better governmental and international regulation and enforcement, rather than voluntary measures, such as donating to charity, are necessary to ensure that companies behave in a socially responsible manner.

Whilst this may be a solid argument, the UK, for example, has only relatively recently seen a raft of gambling legislation passed, so any further developments will likely be far off. Moreover, if you look at most every definition of corporate social responsibility, there is an emphasis on doing more than is expected. What William Hill is doing is more than admirable, but at present, it does seem out of context and out of place, and as such, is open for much scrutiny. If online gaming as an entity is looking to develop new markets and gain cultural acceptance in existing ones, strategic industry-wide, corporately responsible campaigns will act as a catalyst in gaining the social support required for a rethink on existing restrictive legislation.

When you consider the political and financial landscape facing online gambling, there are huge benefits as to why organisations should adopt a CSR strategy.

1) Risk Management – Managing risk is core to online gaming, whether it be sportsbook trading decisions, new market entry, finding loopholes in legislation or working around gaming margins. Reputations that take years to build up can be ruined in hours through incidents such as corruption scandals. Such events can draw unwanted attention from players, regulators, media or governments. Building a genuine culture of ‘doing the right thing’ within an organization can offset these risks.
2) Brand Differentiation – In the crowded online gaming marketplace, operators strive for a USP to separate themselves from the competition. CSR can play an alternative role in building customer loyalty based on distinctive ethical values.
3) License to operate – Little is actually being done on a granular industry level to warrant reconsideration and repeal of UIGEA and alike, besides a bit of communal crying foul and persistent mutterings of disbelief. By taking substantial and voluntary steps, the industry can persuade governments and wider society that it is taking the issues behind the restrictive legislation seriously.
4) Human Resources – Given the fast pace of this industry and the emergence of more and more new operators based in increasingly exotic climes, staff turnover, whilst not necessarily huge compared to some industries rightly worries many companies. Retainment of staff is essential to reduce training costs at lower levels and payouts, loss of key relationships and loss of strategic continuity at the top. CSR can help to improve the perception of a company among its staff, particularly when staff can become involved through payroll giving, fundraising activities or community volunteering.

Corporate Social Responsibility can form part of a company’s communications strategy. Gaming companies, especially those offering diverse product brands and operating from more than one base, can struggle to ensure that a common, corporate message is presented when required. Many publicly listed gaming companies tend to advocate a CSR philosophy through their corporate sites, but very few drive this in to genuine practice – maybe as they are unsure how to go about it.

Affiliate programmes present a unique opportunity to connect with stakeholders both internally and externally. A standard affiliate programme will convey corporate messages through creative, copy and communication it makes available to affiliates, and in turn their customers. Others will look to work with white label partners, taking on a business development approach – a key corporate communication domain.

Most affiliate programmes work closely within the affiliate community. Large forums such as CAP and GPWA can prove to be excellent channels for us to communicate to a wider audience and affiliate conferences open the organization up to more than just gambling webmasters. There is often a significant legal representation, along with local regulatory authorities, allowing the affiliate programme the opportunity to put across key corporate messages to a different kind of stakeholder.

Affiliate Managers become successful because they are excellent at building and maintaining relationships, both internally and externally. Within an organisation, most affiliate programmes will work with most of the key stakeholder groups/departments – senior management, accounts/finance, risk management, security, customer service, marketing, customer retention, design and IT, and right across the brand umbrella. Affiliate Managers’ expertise and experience can be put to use by HR departments to tailor and carry out a communications programme.

Affiliate Managers personally deal with a greater variety of stakeholder than any other employee in an online gaming company and whilst customer service representatives handle no end of player queries, it will be the affiliates who provide a more overarching opinion on the business and its various offerings – taking into account more than the interests of an individual player. Affiliate Managers, as a result, tend to possess a colossal amount of information – whether it be feedback on customer promotions, the functionality of the website or scrutiny of particular payment processes. Companies should attempt to distill this information to develop an internal communications programme that demonstrates how employee roles and responsibilities are interlinked, no matter the department they work for. This is particularly important for those companies with more than one base, with an operation spread across the planet and for those who operate a host of products under one umbrella brand.

The community network that affiliates and affiliate managers belong to is the primary cooperative force currently in action in the gaming industry and the influence the affiliate community has on key external stakeholder groups – namely each other, players, regional government and, perhaps most importantly, the competition – is invaluable and many operators could and should do far more to put the necessary resources, power and trust in to their affiliate programmes to ensure that they support the determination and match the ambition that moves the global gaming affiliate community forward. Affiliates are thought-leaders in this industry. Ensuring that the social media buzz around the operator’s brand remains positive in those seemingly inevitable periods of anti-gambling clamour, operators need the support of those thought-leaders and to do so, they should back their affiliate programme by not only centralizing its importance towards player acquisition, but by also looking to make it the fulcrum of their corporate communication strategy.