Launching an online bingo skin
Published 17th October 2016
In early August Stride Gaming Plc bought two bingo skin operations for a total price that could eventually be as high as £70m. Whilst the two businesses (8Ball Gaming and Tarco) are very different beasts, their sale focuses the spotlight very squarely on the bingo skin market.
Wellknown and experienced bingo affiliates have long had one or more bingo skins in their commercial arsenal, but with these huge price tags, it is inevitable that affiliates from other sectors, as well as larger operations, will start taking a closer look at what has previously been a niche, although profitable, market populated by a small section of the igaming industry.
It is timely, and I believe, would be of interest and of use, to take a closer look at how to go about launching an online bingo skin.
The bingo market
At the time of writing, according to the WhichBingo.co.uk Directory (http://www.whichbingo.co.uk/sites/), there are 440 bingo sites in the UK. A huge percentage of these are white-label sites.
Whilst there are many software suppliers in the bingo market, a vast majority of these bingo skins, particularly those at the bottom end of the market, are driven by just three software suppliers; Dragonfish (part of the 888 empire), Jumpman Gaming and Cozy Games.
What is a ‘bingo skin’ or ‘white label’ site?
For clarity, and for the purposes of this article, a bingo skin is defined as a payto-play online bingo site that is part of a network of sites taking part in linked bingo games, not requiring any operational input by the owner. ‘Operational input’, in this sense, being player registration, financial processing (deposits, payments, payouts etc), basic CRM (welcome emails, KYC, standard network promotions), customer support, game management & scheduling, chat management, and hosting and licensing.
Dragonfish offers the Globalcom network, Jumpman Gaming two bingo networks (and a slots network) and Cozy Games two bingo networks and a casino network. Whilst all bingo sites on a network play the same games in the same rooms and offer a ‘vanilla’ bingo template to work from, there are areas of differentiation offered by each network.
How do you start a bingo business?
Before you even start looking at how to get into the online bingo market you have to ask yourself a number of questions:
- Why do I want to do this?
- What is the opportunity cost of getting into the bingo skin market?
- How much time and money can I invest in the venture?
- Why will my bingo skin be more successful than any other bingo skin?
Assuming you are already in the affiliate market, whether that be bingo, casino or any other igaming vertical, or indeed already own other, non-bingo skins, all of the above questions are relevant and need answering honestly before you even start investigating the market. Whilst actually launching a bingo skin is fairly straightforward, this is a market that at one end is dominated by around a dozen major brands, and at the other end is swamped by the sort of ‘me too’ product that you could easily end up launching.
Is the market flooded and saturated? Yes. Can you still make money? Yes. Is it easy to make substantial (and the definition of substantial will be determined by you) profit? No...although it is achievable.
Having asked yourself the above questions, and come to the conclusion that you want to compete in the crowded market of online bingo sites, there are ten simple steps to follow.
Ten steps to launching a bingo skin
Whilst the ten steps below are in a roughly chronological order, you will find that many overlap and are also subject to the vagaries of each other. These ten areas are also so potentially vast that they could easily be the topic of ten individual articles, and many other issues will also present themselves during the launch of an online bingo skin. However, the following steps will broadly cover the major issues:
- Choose a domain name
- Select your network/software supplier
- Create a logo and design the site from the template supplied
- Decide how you will differentiate your product and your marketing
- Create your marketing collateral
- Commence your pre-launch marketing
- Launch the site with unique launch offers
- Launch your marketing campaign
- Begin marketing to the bingo affiliate community
- Commence customer retention and restart marketing
So what is it really like owning a bingo skin?
Until you have actually got to the point of launching and running a skin it is very difficult to decide whether it will be right for you. To get the ‘warts and all’ view of white label ownership we asked the owners of two best-of-breed Jumpman Gaming and Cozy Games skins for their insights. Mummies Bingo, owned by Andy Edwards, won the ‘Cozy Site of the Year’ at the 2016 WhichBingo awards, while Tom Waites’ Rocket Bingo won the ‘Jumpman Site of the Year’ at the 2016 awards.
Q&A: Andy Edwards - Mummies Bingo
What was your background prior to Mummies Bingo?
AE: I started as a part-time bedroom affiliate way back in January 2006, when I launched Madaboutbingo. I ran this part-time alongside a full-time job until January 2011, and I have been a full-time affiliate every since.
Why did you launch a bingo skin?
AE: I realised that I could make money having my own skin and retain a higher rev share commission than advertising for other bingo sites. It made sense to launch our own bingo site as we could market the site on our own affiliate sites and make more money. As an affiliate, I was in a unique position of knowing what works for bingo players as it’s our business to market online bingo products to attract players to hundreds of sites on a monthly basis.
Why did you go with your particular skin supplier?
AE: When we decided to launch our own bingo site, we did shop around and we were approached by a lot of different software providers. However I liked the look of the Cozy Games platform, had dealt with them for many years as an affiliate and knew that their sites convert well for players. We worked with them on building the website, CRM and SEO in order to get the most out of the site along with their network.
What are the main pros and cons of owning a skin?
AE: The pros are that you get to earn anything from 50% up to 70% of the NGR revenue. When you compare this to a standard affiliate deal or even a flat, top-end rev share deal of 40%-45% you see a greater ROI. You have a lot more say on how to market to the players and what welcome offers you can use. If done right you have the chance to compete against multi-million-pound companies with your own bingo site and own marketing budget. The cons are that you are limited in what you can and can’t go into beyond the standard CRM marketing, and have very little say as to what games will be added or taken away. If you need the site amending or anything technical changing, this can take many weeks as you are reliant on the software provider’s tech team to make the changes you need.
You also need a strong marketing budget to begin with, otherwise you will struggle to stand out from the crowd.
You get to earn anything from 50% up to 70% of the NGR revenue. When you compare this to a standard affiliate deal or even a fl at, top-end rev share deal of 40-45% you see a greater ROI
How have you marketed your skin?
AE: We initially soft launched the site and marketed it on our own affiliate sites. We then gave the site a push with the affiliate programme and got a lot of top affiliates onboard really quickly. From here, our next task was SEO which, with my expertise, has helped get the site to the high ranking it now has two years later.
What tips would you give someone planning to launch a skin?
AE: Shop around and approach different software providers as you can negotiate deals based on what other providers are offering in terms of set-up fees, management fees, min rev share amounts etc. Also use your own marketing expertise.
As affiliates, it’s our job to market sites in such a way in order to drive traffic to the operators for us to earn our commission. Treat your own site the same - this is your biggest earner and you can market this site better then most operators, so use this to your advantage. Also contact your fellow affiliates and ask them to promote the brand for you or agree to push their brand in return.
Finally, slow and steady wins the race, I know you will all want to make as much as you can, as quickly as you can but if you come speeding out of the starting blocks you are likely to make mistakes, and if you go too aggressive on your SEO without first building the brand then you stand to get penalised by Google, which will undo all your hard work.
Q&A: Tom Waites - Rocket Bingo
Tell us a bit about your background
TW: Growing up in Ripon, North Yorkshire, my first memory of bingo is courtesy of Whitby’s amusements! Flashing lights, excited callers and big prizes - it looked like fun and this 10-yearold wanted in! However, my first taste of marketing bingo came years later whilst studying business at university in Newcastle, where one afternoon, in the Toon, my first portal was born! Looking back, this was a great time to join the party, as there was less competition and Google was a whole lot easier to dance with.
Why did you launch a bingo skin?
TW: Baskets and eggs! Having spent five years as an affiliate I had become keen to diversify. I don’t think owning a white label is an essential step for every affiliate, however at the time it seemed sensible for my business and I’m still content I made the move.
Why did you pick the software supplier that you did?
TW: I knew I wanted to create a brand with some USPs, particularly by way of exclusive offerings for my players. I had seen this work previously, so the flexibility offered by Jumpman to offer exclusive promotions, particularly stand-alone rooms, within their quickly improving software, was a strong attraction.
Pre-signing, I studied a few contracts from various suppliers and noted some fairly ‘uncomfortable’ clauses - the devil can definitely be in the detail! (more on that later). However, I generally felt at ease with the Jumpman contract and the positive attitude of their team. In addition to the above, it was Jumpman who first suggested I start a skin.
Pay particular care to understanding all the deductibles from net cash, especially those which are not shared with the supplier; costs such as chargeback commissions can stack up
Whats are the pros and cons of owning a skin?
TW: The pros are that as a skin owner you will have a great, albeit not total, level of control over the running of your brand. If used effectively and where permitted by supplier, this control can allow you to stand out from the crowd and offer your players that special something. In addition, you’ll also have access to reporting that you simply don’t get as an affiliate. This assists you in spending your marketing budget effectively, particularly where PPC is concerned, thanks to conversion tracking and other tools issued by ‘Big G’.
As for the cons, set-up costs can be high and you need to keep a close eye on your marketing spend. Be selective when choosing affiliates to work with; know their traffic source as all traffic is not equal. I learnt this lesson through a couple of runaway CPA campaigns, that are still heavily negative. Take home point - periods of financial loss are entirely possible.
Other challenges rise from costs that will be payable from your portion of the revenue share including, for example, affiliates. It’s difficult to offer an appealing deal to affiliates whilst leaving something ‘in it’ for yourself.
How have you marketed your skin?
TW: I’ve used a variety of different methods including affiliates, PPC, SEO and making use of my own opt-in mailing lists from years gone by. Going forward I am focussing heavily on further scaling my PPC campaigns as I see this as a relatively stable traffic source compared to organic, especially at a time when Google is piling an ever-increasing amount of adverts on top of the organic results - I doubt this trend will change.
What tips would you give to someone planning to launch a skin ?
TW: Take your time finding the right supplier for your business. Be early in asking for a copy of the ‘standard’ contract - examine it forensically and negotiate strongly! Pay particular care to understanding all the deductibles from net cash, especially those which are not shared with the supplier; costs such as chargeback commissions can stack up.
If the contract requires you to guarantee net cash after launch or a minimum marketing spend, consider carefully if it will work for your business. Such requirements didn’t work for my business and amounted to unnecessary risk as opposed to incentive to succeed.
And finally, know your marketing strategy before you launch and never rely exclusively on any one particular traffic source. Good luck!
Online bingo is a busy, very competitive, saturated market, but despite this, there are still opportunities out there. Hopefully this article will help if you are considering starting an online bingo skin from scratch, inform you about what to expect, whether it’s worth your while, how you can market it to make it successful and whether or not you are then going to make money