INSIGHT
INSIGHT
ONWARDS
AND UPWARDS
With more US states lining up to take advantage of the PASPA repeal, and a
knowledgeable player base there for the taking, Erica Anderson considers
whether 2019 will be the year when affiliate marketing reaches its tipping point
“THE TIPPING POINT is that magic
moment when an idea, trend, or
social behaviour crosses a threshold,
tips, and spreads like wildfire,” writes
Malcolm Gladwell in The Tipping
Point. He defines context and a
concept or product’s ‘stickiness’ as
key factors in instigating this ‘magic
moment’. Following the repeal of
PASPA and the imminent launch of
the Pennsylvania igaming market, is
affiliate marketing reaching its own
tipping point in the US? One thing’s
for sure: with contextual factors and
affiliates’ ‘stickiness’ as an acquisition
channel aligning, the next year will see
a major change in affiliate marketing’s
American evolution.
Context and stickiness
The affiliate channel’s growth has been
slowed in the US by limitations at both
a vertical and a market level. Until
its repeal in May, PASPA prohibited
single-event sports betting outside of
Nevada (pop: three million), a state
that regulated ipoker in 2013. New
Jersey (nine million), whose igaming
market also launched in 2013, and
Delaware (one million), both went live
from 2012 and remain the only states
offering both online poker and casino.
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iGB Affiliate Issue 72 DEC 2018 / JAN 2019
These contextual limitations aside,
New Jersey, the largest igaming
market, has actively embraced the
affiliate channel. The Division
of Gaming Enforcement (DGE)
licensed affiliates from launch, with
a free vendor registration required
to promote on a cost per acquisition
basis, or an ancillary CSIE licence
costing $2,000 for revenue share deals.
In addition to the documentation
required by the DGE, Adam Small,
CEO of affiliate business DGS Media,
points out that applying to join a New
Jersey brand’s programme can be a
rigorous process. “When I started
NJOnlineGambling.com, it took me
six months to get set up with one of
the operators I wanted to work with,”
he says.
Fellow affiliate Becky Kingman-
Gros, COO of Casino Connection and
“The best affiliates
will keep getting
more professional
and sophisticated,
with larger and
more expensive
operations”
iGaming Player, suggests that initially
affiliates targeting New Jersey also
faced brand-specific issues relating to
player geolocation, identification and
transactions. However, she adds, “The
NJ online market has seen a steady
improvement as players became more
comfortable with the concept of online
gaming. Technology has improved and
regulators are confident that there are
few remaining issues to resolve.”
This improvement has been
accompanied by commercial growth.
As Michael Daly, general manager
US at Catena Media, says, “NJ online
has been growing 15-20% each year
since launch and is now over 10% of
the total revenue for the state.” Indeed,
the DGE has revealed that the state’s
strongest monthly igaming revenue
came last quarter: $25.9 million in July
and $25.8 million in September.
According to Income Access’ 2018
New Jersey igaming data, affiliates can
be responsible for 15-20% of player
acquisitions. Affiliates’ ‘stickiness’ as
a marketing channel has been further
proven by their cost-effectiveness, with
operators only paying for depositing
players. “Much of the risk and costs
spent in this pursuit is offset from
them to us,” says Daly, who adds that