Erica Anderson of Paysafe’s Income Access explores the development and opportunities of the US igaming marketplace
As more states pass legislation to legalise online gambling activities, the United States is seeing a corresponding increase in the number of opportunities for partnerships between operators and affiliates to grow in new and emerging markets. Brands and personalities that have never been associated with igaming have been flocking to the space across all platforms, whether it be traditional desktop/mobile sites, customised apps, or even over Twitch. This momentum can be largely credited to the repeal of PASPA in May 2018, prior to which an estimated $150bn was wagered illegally on sports in the US each year, according to the American Gaming Association (AGA).
In our recent EGR webinar, United States of Affiliate Marketing? Exploring the Opportunities and Navigating the Challenges, a variety of experts were assembled to discuss ways to navigate this market. The panel consisted of David Smith, head of commercial, US at Better Collective; Alisa Cioian, team lead key accounts & global at Kindred Group; and Fintan Costello, managing director at BonusFinder.com. We discussed all the opportunities and challenges in the US affiliate market and what they mean for both affiliates and operators.
For affiliates and operators looking to join the space or improve their position, the key takeaways from this webinar, including entry tactics, expectations around compensation, and what challenges are present in the market, will provide valuable guidance.
Overview of the US igaming market
The launch of more US igaming markets is accompanied by a wide array of state-specific regulatory frameworks with some straightforward and others quite complex.
During the webinar, Costello said that his team is “treating every state like its own country because of the differences between the legislation, the brands they’re working with, the offers, the tax, and the licensing requirements. So, every state is a mini-country”. Smith shared the sentiment, stating: “It’s not a one-size fits all approach by any means […] so we focus state-by-state. We’ve built top positions in European markets, so there are certain lessons we can take from there […] but it’s certainly a different path to get there.”
Affiliates and operators should evaluate opportunities state-by-state, focusing on respective audience, regulations, and interests before deciding which to enter. Many of the tactics used in Europe are not easy to transfer to the US, necessitating tailored, market-specific strategies. One such example is that the US requires affiliates to obtain licences, which is uncommon in other areas of the world.
When looking at where to start, Costello said that his team took the route that every affiliate takes into the US. “We started with a New Jersey CPA vendor licence. Super simple, one form and off you go. That’s kind of like getting your toes wet in the market.”
As the regulated US igaming market evolves, it will become increasingly important to accommodate a wider array of revenue-sharing deals that more mature regions are accustomed to. These deals require comprehensive data sets that many operators are not yet equipped to support. Therefore, most operators lean on CPA deals and look towards paying upfront costs, rather than investing in longer-term relationships.
In terms of promotional activities, SEO is a time-tested approach for affiliates with proven efficiency in the US. However, given the time-intensive nature of successful SEO, diversity should always be king in the affiliate acquisition strategy. Such a strategy might also include PPC, which can be effective but imprecise without daily reporting – something not currently offered by all operators.
“The more affiliates diversify their traffic, the better it is for them and the more we can work with them in the long run,” said Cioian. “We know that SEO can take a while to pick up, while PPC would be quicker in terms of volume, and paid social can bring in customers and create that sort of community. We’ve seen a lot of different things from our affiliates in the US.”
Opportunities in the market
As more states pass legislation allowing various forms of online gambling, there needs to be a corresponding effort to educate audiences and earn a positive response to new product offerings. With igaming not as engrained in US culture as it is in Europe, there is an opportunity to engage players in emerging markets and position a brand as the preferred option based on its unique offer and credibility.
For operators, affiliates are looking for transparent and robust data, along with optimised platforms to engage players, giving a clear path forward on how to improve those relationships. On the affiliate side, it is important to look for markets that fit their content and go through the process of learning the respective state rules.
Challenges of the market
While the US market is growing, it has experienced lower conversion rates compared to others, another issue making it more difficult for affiliates to use PPC campaigns to acquire players. Also, if affiliates do not have access to daily reports – another issue in the US market – it can be difficult to optimise PPC campaigns to be successful.
Affiliates will also frequently have to contend with operators that have poor landing pages without a clear funnel to get players engaged. “They think that operators are leaving a lot of money on the table with their landing pages, how they’re trying to segment their traffic and the way they’re passing their offers through,” said Costello. “It still feels early for some of the operators.”
“If you don’t have perfect daily reporting, how do you optimise versus yesterday’s results?” Smith added. “It allows for more things that are day-to-day when it comes to PPC where you have to optimise.”
US affiliates are also subject to more regulations than in other markets, even requiring multiple licenses in certain states. “The fact that the US has a licensing process for affiliates is quite interesting because we don’t really see that in Europe,” said Cioian. “I think the only country that requires a licence for affiliates is Romania. So, the process there is not as heavy as it is here.”
The United States is an emerging market that will only grow as more states legalise online gambling, whether it’s sports betting, online casino, poker or a combination of those. As our webinar emphasised, both operators and affiliates will need to be vigilant of the regulatory changes each state will make. As the market matures, the hope is that greater data and transparency will allow affiliates to provide higher conversion rates as they will further tailor their advertising strategies.
If you would like to view the entire webinar, go to https://www.egrvirtualseries.com/page/1744872/10-march—income-access-]
Erica Anderson’s role focuses on developing the marketing strategy for the Income Access brand. Holding a decade’s industry experience, she also oversees the company’s in-house affiliate management team and its suite of digital marketing services. Income Access manages close to 20 affiliate programmes.