NORTH AMERICA
Adapt or die
Stuart Simms , FairPlay Sports Media group CEO , writes on the struggling affiliate model and why innovation is needed to breathe fresh life into the US igaming market
Having been fortunate enough to lead one of the world ’ s largest affiliate networks and programmatic advertising businesses , I ’ m well positioned to comment on the macro trends and market movements in this sector .
To that end , the fact that the state of the struggling US igaming affiliate ecosystem is still perplexing to me must be of some concern . Its apparent reluctance to move forward and adopt successful , proven strategies that we find elsewhere – particularly in the arguably more progressive retail and FMCG industries – throws up a number of red flags , many of which we need to rectify quickly .
Three-headed problem
Our industry is at an important juncture in its maturation , where the accelerants that have been used to date to fuel US market growth are now becoming toxic and need a root-to-branch overhaul for this space to achieve its full potential . The US sports betting affiliate landscape is under duress , mostly through actions of its own , and needs a prompt overhaul .
Adapt or die . It ’ s certainly not a new axiom , but it is a reliable one .
As for how to adapt , it is important to understand the three general types of affiliates from which the problems emanate . Firstly , there is the ‘ dumb pipe ’, a digital property that shows affiliate links with no content or context to the product or service they represent . Their audience could be attractive to a brand due to its scale and reach , or via associated content .
Next you have the ‘ intelligent and informative ’ sites which utilise some form of expertise and content to acquire , attract and sometimes retain customers . By using SEO and paid marketing , they deliver high-value consumers to their customers and assist in reactivation every now and then .
Lastly , the ‘ customer of the brands ’ service speaks from experience , offering trusted reviews and insights of a service or product across their digital presence .
Scale over quality
When we talk of large affiliates , they tend to operate across their digital estate and media partnerships with all three of the aforementioned approaches . Brand affiliate teams succumb to this approach as they achieve agreed , committed volume and hit acquisition targets in doing so .
In a maturing market , such as the US igaming space , these processes work well in driving volume , but do little to support long-term industry growth . There ’ s no onus on stimulating innovation and investment , a particular downside to the predominant business model of cost per acquisition .
What this approach also rewards is scale over quality . Those large enough to embark on ambitious
CPA campaigns can do so with confidence , stifling those publishers and media properties with deeper expertise , smarter technology and more enticing content .
In its current state , the US market is currently rewarding expertise but not technology and content , with the side-effect that dominant affiliates are taking credit and being rewarded for partner brands ’ marketing activities .
Squeezed out
Speaking to various small to medium-sized publishers , it ’ s apparent that they are becoming increasingly squeezed out . They ’ re not receiving the recognition for the players they bring to the table , nor the additional long-term value they create through their content teams and technical delivery .
Facing this suffocation and the knock-on it has on budgets , additionally stressed by the regularity of new state launches , innovation is hard to come by internally , to the detriment of the whole industry .
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