INSIGHT
So, how can operators continue to pay
lifetime high revenue shares and CPAs and
with no negative rollover fees? Let’s take a
basic example of a player P&L on a 50%
revenue share deal.
● ● Take 1 player at £100 GGR
15% POC tax (£15)
30% bonus cost (£30)
● ● NGR = £55
15% software costs (£15)
15% staff costs + fixed costs (£15)
2% processing fees (£2)
● ● Revenue = £23
50% affiliate costs of NGR (£27.50)
● ● Operator profit = -£4.50 (minus)
No negative carryover, plus revenue
guarantees, plus TV advertising makes
this loss even bigger!
So, how can an operator do this?
Somehow the numbers you are seeing
can’t be real and if they are it’s not
lifetime! CPAs are the same.
To conclude: if affiliates want to
avoid other operators closing
programmes or stopping affiliation —
and if operators want to continue to
benefit from the skills that affiliates
provide the industry — they are going
to have to change and become true
long-term partners.
Revenue shares and CPAs are
going to have to reflect the new reality
and drop. If a country closes, both
operator and affiliate will be affected,
and operators will have to work closely
with affiliates on the marketing message.
“Revenue shares and CPAs are going to have to reflect
the new reality and drop”
After all, they could lose their licence
just because of one affiliate’s marketing.
If this happens, affiliation in my view is
very much alive and for the long-term.
PETER MARCUS is a
15-year veteran of the online
gaming industry, the former
COO for William Hill online and
UK managing director of Betfair.
He has run a successful igaming
consulting business since 2013,
working with some of the largest
operators in the industry.
REPORT COMING SOON
[
Discover what affi liates and operators are saying
about the igaming affi liate industry in 2018
The Industry landscape:
Affi liates in igaming 2018
]