It's time to rethink relationships

It's time to rethink relationships

The igaming affiliate channel is growing but many operators are still adopting a short-term and one-sided approach to working with them, says Paysafe Group’s Lee-Ann Johnstone.

Published 18th January 2017

In December, we all start winding down before the New Year and so it’s a great opportunity to look back on what we’ve learned over the last 12 months. It’s also the perfect time to look forward to what 2017 may bring, especially in the constantly evolving igaming affiliate industry.

I’ve looked back at the various affiliate surveys and events I’ve hosted and attended over the past few months. I’ve also spoken to several affiliates working with Paysafe Group, which represents a broad spectrum of the industry, even more so following the acquisition of Income Access in September. I want to share some of the main insights from these. 

Content is king but data is the new queen
‘Content is king‘ has been the mantra digital marketers have lived by over the past few years, as they start to better understand how to engage their target audiences online. Typically, they adopt a lead stance that’s either focused on hygiene (factual updates) or hero (creative engagement).

Paddy Power is doing this brilliantly. The sportsbook has developed a tone and persona on social media that’s as famous as the brand itself. While content is still key to acquire and engage, data is increasingly rivalling this prioritisation within the digital community. How many affiliate sites that drive significant revenue for  your programme are there today that don’t collect email addresses or require customers to opt-in for special offers?

Successful affiliates are no longer concerned with just driving traffic, they now also capture their customers’ personal information and build successful stimulation campaigns to remarket to their database and increase monetisation values. Affiliates are undeniably some of the cleverest digital marketers I know. They often see trends before operators do. Vitally, they’ll share their experience with the operators they’ve built a collaborative relationship with.

There are several ways operators can harness the data collected by affiliates. First, affiliates can now play a bigger role in increasing operators’ digital ROI. Affiliates have a broad spectrum of data on their traffic and can use their sophisticated data analytics reports to bring you high-value players from their current complement of previously tracked users. Not only are they able to send a brand more traffic because their data collection is optimised and transparent, they can also help operators retain and engage their own customers, including across their sub brands.

Affiliates can dissect their player data and target the customer segments that would be best suited for a promotion or new casino game. This will result in conversions that are both targeted and cost-effective. 

The best part is that affiliates’ commercial terms are currently quite flexible. There are no set rules that govern whether an affiliate should be paid by fixed fee, cost per acquisition (CPA), hybrid or revenue share for their data. This means that operators can consider how they want to pay for specific segments of an affiliate’s data set and diversify their media budget to target successful lookalike audiences within an affiliate’s data stack.

In addition, a brand’s content (the message) and when and how it’s delivered (time, place and relevance) are the other advantages of data-driven activities. Attribution modelling aside, marketing strategy in this regard is still lacking. Arguably, some brands fail to see that the lines have already blurred between affiliates, media and other acquisition channels. Data is helping to eliminate these categories and providing better ways for more effective collaboration.

In 2017, there will be no standard ‘box’ that an affiliate should fit neatly into. Operators should think outside of this limited parameter and find better ways to collaborate with affiliates by using data as their window of opportunity.

Forget the 80/20 rule
Affiliate marketing is not an easy job. Success takes guts and a steel determination, especially in a market where regulation and consolidation are increasingly important challenges. I’m living proof that if you spend 100% of your effort building solid relationships with affiliates, revenue growth follows naturally.

Through collaboration, I’ve grown affiliate programmes from nothing into multimillion dollar global businesses. Flashy commercials will only get you so far, but as a successful affiliate manager, your strength is valued by the dedication you give to building enduring relationships. Having a vested interest in the success of their businesses, affiliates make powerful collaborators, as they will seek to achieve a long-term strategy and not just carry out erratic, incentivised traffic-driving activities with short-term goals.

Over the years, I’ve spent a lot of my time mentoring affiliates to help them improve their businesses. AffiliateFEST is one of the education programmes I’ve created with this in mind. Earlier this year I saw how this methodology could pay dividends, when a Greece-based affiliate I’ve mentored, Betarades.gr, won the ‘Best Foreign Language Website’ at the 2016 iGB Affiliate Awards. I met the guys behind this site eight years ago when they were newbies, varsity graduates with a passion for sport and big dreams.

At the time, they had a low-traffic website and were dedicating themselves to growing their business and succeeding in Greece, a market that was quite tricky for operators to penetrate. They had a passion for the sports betting vertical and a vision to build a business that would create jobs for their local economy, but needed business mentorship to develop their brand and cultivate their niche following.  If I’d have spent 80% of my time building a relationship with the top 20% of affiliates in that programme at that time and ignored these guys, I’d have missed out on building a successful relationship and important new revenue stream. Based on my experience with Betarades and other affiliates like them, I’d recommend operators forget about archaic 80/20 business rules and simply focus on building meaningful and longstanding affiliate relationships. 

Take the longer, broader view
There are several vital areas that will drive affiliate marketing’s evolution as a key performance metric within operators’ broader digital marketing strategies. Brands need to consider affiliate marketing as a broader part of their overall digital strategy. The igaming affiliate channel is growing and is expected to reach $6.8 billion by 2020, according to Forrester Research. 

Both operators and affiliates need to consider where affiliate marketing is heading, and we all need to focus more on building relationships with the long view in mind.  Let’s relegate to the past that old question, “How much traffic can you bring me right now”? As we move into 2017, many affiliates are corporates so why aren’t all affiliate managers and acquisition managers treating them as such? They operate under the same regulations as operators do.

Moreover, several of the bigger affiliates employ a full complement of staff and are responsible for paying salaries too. They are professional business owners who are busy developing strong consumer brands. Today’s affiliates add value within operators’ acquisition cycles, but they are arguably underused in other stages of the customer lifecycle too. A recent survey conducted by Forrester Research’s affiliate network Rakuten revealed some important insights on today’s affiliate marketing strategies. They speak volumes about why igaming brands need to rethink their affiliate strategies and relationship building next year. Here are the key takeaways from the survey:

  • Marketers use affiliate programmes throughout the customer journey (buying cycle),  83% in the discovery and awareness phase, 79% during conversion or purchase and 79% for ongoing customer engagement. Creating content that drives real value for customers and delivering it in a trustworthy way can be a significant challenge for many advertisers.
  • Nearly 90% of affiliate advertisers said affiliate programmes were important or very important to their overall strategy, with 80% devoting more than 10% of their budgets to the affiliate channel.
  • Meanwhile, more than half the surveyed affiliate publishers reported the programmes accounted for more than 20% of their annual revenue.

Many affiliates feel there needs to be more understanding from operators about how affiliate businesses work and more focus on transparent collaboration. Affiliates frequently complain about experiencing one-sided conversations with pushy, inexperienced account managers uninterested in developing long-term business relationships. This trend was evident in answers to an affiliate survey AffiliateFEST carried out in October.

1. What do you think operators could do to improve affiliate relationships?

Affiliatesurvey1.PNG

2. If you could change one thing in the igaming industry, what would this be?

  • “Affiliate managers should be more professional and better trained.”
  • “I’d remove the bullsh*t that comes with the affiliate sphere. Salesy, pushy ‘account managers’ that you’ll never here [sic] from again, even if you are still promoting their brands.”
  • “Pushy AM’s with nothing more to offer than usual Bullsh*t.”
  • “Better communications of player promotions to affiliates.”

I hope these affiliate insights and the other points I’ve made resonate with both operators and affiliates as they fine-tune their marketing and communications strategies for 2017. Hopefully, we can all change our approaches in the New Year to ensure that the igaming affiliate marketing channel continues to not only evolve but also grow as strongly as it has to date. 

 

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