German-based super affiliate Feda Mecan has overseen successful expansion into multiple territories since entering the space around ten years ago. We found out more about the strategy and model that has made this possible.
How and when did you first come to enter the gambling affiliate space, and when did you start making enough money to give up the day job and go into affiliation full-time? I actually started in the wider industry when I was 23, so around 2005, with a classic retail betting shop in Germany. We were caught up in the huge hype surrounding a fast-growing and unregulated market and the authorities were very tolerant. This and the fact that we were just waiting for the 2006 World Cup in Germany to start – the perfect moment! After 12 months, I started looking more into the online side of betting and gaming, learning everything about CMS systems once I had explored the potential of the revenue share model. The shops had to close down due to subsequent issues around regulation in Germany, but by then I was already active online. From there, it took me about a year to reach the point where I could really give up any other job and focus on the affiliate world.
“The mobile numbers are crazy now. In Germany and the UK, we are at around 65-70%, in Kenya, Nigeria etc.sometimes up at 80%.”Can you tell us more about how the overall business is structured and operated? I have a very decentralized approach. There are projects that are 100% mine, where we work with around 20 people, that are mainly focused on betting via portals such as wettbonus.net and mybettingbonus.co.uk. I also have three joint ventures with other people where the synergies help both sides. A good example of this is casinocountdown.com, a CMS completely self-developed to be a perfect fit for future challenges in the gambling market, or future-focused investments such as our bet on the regulated US market with playinglegal.com. Do you use third-party agencies for any of your digital marketing/ acquisition activity, and if so, which budgets/types? No, we actually do all of this in-house. There are now around 50 people involved if we take all our activities into account, and we like to keep it inside the business. If there are some technical or development issues, we have the ability to be flexible with the budget and have a list of partners that can help out. I am a big believer in flexible budgeting. I find it amazing that we are still all running on yearly budgeting models in a world that is 10 times faster then it ever was. You started out with a strong focus on the German market. How has the market being in a state of flux due to the regulatory situation there affected your activities and revenues? Have you had to adapt your model and approach? The overall revenues are up, but the regulatory framework is still a long way from being 100% implemented. A lot of interest groups are pushing their own agendas instead of looking for a real and workable solution. We are slowly edging closer to regulation, but it looks like this will, yet again, be subject to more legal action, because this won’t be consistent and fair. As an affiliate business, we have to be careful what we present to the market and how, and also try and think some steps ahead. It is actually very sad that we are still limited in terms of our advertising creativity, as some channels will simply be closed until we have full regulation of the market. What are the leading sportsbook and casino brands in Germanynow, and what is it about their particular approaches that have resonated with players there? Tipico is the absolute number one. They have over 2,000 physical shops in Germany, and are partnered with Bayern Munich etc. Tipico basically showed how to buy the market if you have a strong retail business with high margins (compared to online) behind you. Bwin is still big, and of course bet365. What we are seeing now is a huge step up from Betway, which is sponsoring several second league football clubs and growing really fast. In casino, I guess we are still talking 888 and some Mr Green here. The old school guys like CasinoClub will still be producing high revenues too, but the real king is probably Stargames, simply because of the Novomatic slots. What is the policy of the leading search engines towards online gambling in Germany, and how does this affect the types of marketing and acquisition activity you can undertake? The Big G is showing the first signs of flexibility towards the sector in Germany, but mainly for sports. It has still not really opened up. Companies like Tipico and mybet are tricking the search engines with bridge sites, and Google just keeps its eyes closed, it appears. There is huge unrealised potential here, but on the other hand, it keeps the SEO game wide open, because PPC is not ruining the look search results! You diversified into a number of new countries/territories recently. How did you settle on the approach or model suitable for each of these, and which are proving most successful? We are very happy with UK and Latin America at the moment. Our approach is to build a core that is as localised as possible. We never for a moment believe we are smarter then the existing market and understand that we have to fit in. The style of the website is as important as the trigger you use to convert. You run a US-facing portal focused on the regulated state iGaming markets. How have youfound the experience working with operators and regulators there? It’s fun, in weird and often amusing ways! You have everything, from DFS operators who are sometimes quite ignorant towards new affiliates like us simply because they are so loaded with cheap VC money, and just don’t care, to incredibly old school companies that still very confused by affiliate marketing. It’s a crazy market, and very complex when it comes to navigating regulation, because we cover everything that is allowed in the individual states. We hear it’s getting harder to drive high volumes of traffic with margins being squeezed. How have youmanaged to overcome this and continue to grow the business, other than by targeting new countries/territories/languages? I don’t really share this view. You have to get more professional and try to be more precise over where and whom you convert, that’s for sure, but the margins are still OK. Most of the affiliates crying now are the ones who were always only quantity-focused and did most of their signups through bonus customers. For them, this happy time is probably over. The complex aspect these days is the diversity in channels you are now faced with, from social networks to video networks etc. Affiliates and operators still seem to struggle when it comes to negotiating commercial terms and finding synergies. Why is this, and what can operators and affi liates do differently or better to make these partnerships work better? That’s a good question. I think both parties have to finally get more professional, but it needs to be emphasised this is not a one way street. Both sides need to stop thinking: “I can now get what I want and can still screw the other side over to change things“, and this applies to both parties. We came up with some crazy ways to get our money in the past when companies tried to cheat us. What proportion of your traffic is now coming from mobile vs. desktop, and what challenges is this presenting you with? In Germany, the UK, Asia and Africa, the mobile numbers are crazy now. In Germany and the UK, we are at around 65-70%, in Kenya, Nigeria etc. sometimes up at 80%. We are, more and more, building sites using the responsive approach, but also the other way around too; we start with the idea of what we want to see on mobile and then look to adapt this to desktop. Which three things do you wish you had known before embarking on a career as an affi liate that would have allowed you to have reached your goals more quickly? That everything you do is about the long-term effect, understanding that “no, you are not special”, and expand early. What are the biggest challenges or obstacles facing your business and the wider iGaming affiliate sector at the moment? To build something that is not so dependent on Google. Put simply, Google is just looking for chances to shave the margins of yet another business. I guarantee that we would see Google directly competing with us if the wider image of gambling was better. We need to generate traffic from other channels, and this means a whole eco-system of traffic, not just jumping on the next bandwagon and depending on another company. The second huge challenge is the need to create a technical advantage. Having 100,000 WordPress sites works now, but the underlying technical complexity is growing, so this approach simply won’t work long term.