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iGaming Commissions Explained: CPA, RevShare, Hybrid & Fixed
Ever wondered how top casino operators set up their iGaming commission plan? This article will guide you through everything you need to create a winning affiliate strategy.
How to set up a profitable casino iGaming commission plan? What are the most common iGaming affiliate commission plans?
To answer these questions, first of all let’s understand what commission plans serve for. Through commission plans…
- iGaming operators reward affiliates for already gained revenue
- Affiliates are motivated to promote a specific operator in order to gain larger rewards
After reading this article, you’ll have all the insights needed to understand commission plans in depth. An iGaming commission plan is pretty straightforward, once you understand how it works.
How do iGaming commissions work and who’s involved in it?
Commissions in iGaming are a means of paying affiliates for the services they provide, i.e. generating traffic and bringing in a targeted audience.
Here are the parties involved during the process:
- The affiliate is the one promoting the company’s offered services and the one driving traffic to the company’s website.
- The operator is the one wanting to collaborate with an affiliate to bring in clients for their website, raise sales, advertise their services, or enhance engagement.
- Networks are affiliate programs comprising multiple iGaming brands under one roof and offering to promote those brands to affiliates.
- AffPapa is a directory that brings the two parties – affiliates and operators together, and provides them with all the necessary tools to help them cooperate independently and in a mutually beneficial way.
Top 4 iGaming commission types
Choosing the right iGaming commission plan and rates is essential for keeping your affiliates engaged and satisfied. Let’s go through the most common types of affiliate commissions in the iGaming world.
iGaming CPA Commission
One of the most common iGaming commission kinds in the market is cost-per-acquisition (also known as cost-per-action). It is quite a simple concept when you gain insight into how it works. The CPA commission implies that the affiliate receives a one-time payment when a player they linked accomplishes an activity (an agreed-upon action) on the casino website, such as making first-time deposits (FTD), simply registering, or placing bets.
For example, NetBet (shown below) has CPA commission ranging from 13.00€ to 70.00€.
CPA commission deals are simple and effective for operators, however, as mentioned previously, they involve one-time payments per action, which can usually only occur once for every customer. This may not present much of a downside for affiliates that focus on frequently acquiring new gamblers on their websites, however, affiliates that have a relatively slower-growing yet loyal audience may be better off with a recurring commission method, such as the Revenue Share model, which we will discuss next.
Rev Share Commission
Revenue Share is regarded as one of the most tempting iGaming commission plans. In contrast to CPA, where you earn a commission once per action, RevShare affiliates receive recurring payments for as long as the linked consumer remains to use the brand’s services (or a set duration agreed upon by the affiliate and the brand). The affiliate is paid a percentage of the overall revenue amount.
Revshare is more than just a traffic generator. You need to produce continuous sales and be able to convert customers’ initial curiosity into a financial result when using Revshare. Although this commission type involves more effort on the affiliate’s part, it is unquestionably profitable with the greatest levels of income.
Because of its recurring nature, the revenue share commission model is likely to cost more for operators, especially if they offer their partners lifetime ownership deals, which are quite common nowadays, and need to keep paying a portion of their revenues to their affiliates. However, these added costs are quickly offset by the fact that affiliates will need to provide higher quality traffic to generate a sustainable income for themselves, meaning in many cases revenue share deals could benefit both parties greatly.
NOTE: Rev Share is paid as a percentage of total revenue produced – and the percentage might vary from plan to plan. For Sportsbooks, it could range from 15% to 40% (sometimes higher), whereas Casinos and Pokers can go up to 60%.
Hybrid Commission
This iGaming commission structure combines a set CPA commission rate with a portion of the operator’s revenue from driven players through a revenue share model. Through hybrid iGaming affiliate commissions, the affiliate receives payment when a user registers on the operator’s website and/or deposits funds, depending on what monetizable activity the two parties have chosen ahead of time, but it doesn’t stop there. The affiliate continues to receive a percentage from the generated revenue as long as the player referred by them keeps playing and wagering on the operator’s website, although this is subject to the operator offering lifetime ownership deals to its partners.
NOTE: In such cases, a given hybrid deal’s RevShare and CPA components are typically offered at substantially lower rates than their standalone commission plan counterparts, although for some iGaming affiliates hybrid deals may present a better value than revenue share or CPA ones.
Fixed Fee Commission
A fixed fee is an agreed-upon amount that an affiliate requests in order to list the operator on its website. This has the effect of allowing the affiliate to represent its operator partners in a more objective manner and in a fairer setting, as aggressively pushing casinos that are proven to outperform the competition won’t have the same effect on the affiliate in terms of revenue growth. Consequently, advertisers using this type of affiliate commissions also produce higher-quality content for their readers, which further enhances their appeal.
Typically, these affiliates are well-known brands with a high level of authority among gamers who rely on their reviews. For example, in order to be listed on AskGamblers’ website, the operator has to pay a one-time fixed fee of 2500 EUR. Additionally, many firms utilizing the fixed-fee affiliate commission method also make use of a traditional iGaming commission plan at a lower rate to further grow their revenue while maintaining the benefits of fixed listing fees.
CPA vs. Rev Share
The commission model hugely affects how a program’s affiliate strategy is designed. Here is what they break down to help you decide:
iGaming CPA commission is for short-term gains with predictable costs.
- The pros of CPA include easier budgeting for operators, quick earnings with less effort for affiliates.
- However, one-time payments are not very motivating for affiliates, and there’s a risk of losing out on long-time revenue from loyal partners.
CPA is best if you’re looking for quick player acquisition, hence, affiliates with a focus on fast traffic turnover.
Revenue Share, on the other hand, pays affiliates to focus on retention and quality traffic.
- The steady income of Rev Share encourages affiliates to put in consistent effort for better and more targeted traffic.
- As a downside, Rev Share is clearly costlier, especially with lifetime deals, and requires more time and effort to see substantial results.
Rev Share is best for you if you have a long-term goal of quality traffic, lasting player engagement, and affiliates with slower-growing but loyal audiences.
Dos and Don’ts for Developing an iGaming Commission Plan
Best Practices
Analyze the Market: Examine the market and your competitors to ensure that you are not offering something out of the ordinary. Analyze what they have to offer and what commission plans are available in the industry.
Don’t Chase the Highest Commission: Don’t jump towards the highest commission plan – the best commission plan is not the highest, but rather the one allowing both the operator and the affiliate to make money at the same time, without one being overpaid or underpaid.
Focus on Relevance and Conversion: Instead of chasing the highest commission plan, aim to improve your brand’s relevancy and conversion. With its bonuses, language, and offers, each website is tailored to a certain market. Relevancy is essential for maintaining high conversion rates.
Target the Right Market: Following on from the preceding, the significance of identifying the appropriate market to advertise your website cannot be stressed enough. You must ensure that you are as relevant as possible in the market in which you have decided to promote your website. If not done so, the affiliate may choose another operator’s website that is more relevant to that market.
Prioritize Localization: Ensuring a high degree of relevance for an online gambling website can be done through a variety of means, with achieving a high level of localization through supporting a variety of local payment options and languages being quite an important component. This applies to both gambling websites that only operate in a select few jurisdictions and to online casinos that offer their services all across the globe, as players are always looking for the most convenient way to enjoy the gambling pastime.
Choose the Right Affiliates: Choosing a relevant affiliate is also vital because you can’t work with any affiliate – each one targets a different audience with varying interests, desires, spending habits, and more. This is particularly important for sports betting operators, as the wagering pastime can be broken down by not only sports but also by betting types, which include various innovative options like micro betting, live betting, and more. Sportsbooks also have a wider selection of affiliates to choose from, as many sports wagering affiliate firms provide their users with a varying set of content, such as betting tips, reviews, advice, and more. Check out our article on sportsbook traffic to learn more. Many affiliates also target a specific set of jurisdictions around the world, which is another part that is vital to get right to ensure the success of your gambling business.
Now that we’ve covered what to consider when developing a commission plan, let’s take a look at what you should avoid at all costs.
What to Avoid
Don’t propose tempting and big payments to affiliates, only to reduce them over time. While it is common practice in the industry for operators to offer special iGaming commission deals to attract new partners, it is vital for these to be promoted as special offers to not confuse and mislead prospecting partners. Additionally, it is also important for the operator’s long-term commissions to be sustainable to avoid changing terms too often.
Don’t add any hidden costs to your revenue. Affiliates will sense it – it will be clear within a short amount of time, and you will quickly lose authority. Additionally, having hidden or obscured fees is one of the most prominent reasons why affiliates blacklist operators, as it is a practice that is frowned upon by the entirety of the industry. This includes having a variety of admin fees, service fees, or support fees, which most of the time serve no purpose other than to let a low-quality operator advertise standout commission deals while not actually paying them to prospecting affiliate partners.
Make sure there are no hidden terms (for example the affiliate suddenly discovers that the player no longer belongs to them, because of a term in the agreement that unlinks the player after x months from the affiliate.). Similarly to our last point, this is another technique used by unfair and lower-quality operators to artificially inflate the quality of their offerings. Most high-quality iGaming affiliate programs offer partners lifetime ownership deals, meaning that each of an affiliate’s directed players will be generating revenue for them for as long as they continue enjoying the pastime at the operator’s website. This provides affiliates with long-term growth opportunities, which are highly sought-after in the industry.
Don’t delay payments – delaying your payments may have major effects – including a deterioration in your relationship with the affiliate
Avoid overcomplicating the commission structure – a complex commission plan can confuse affiliates, making it difficult for them to understand how much they will earn. The frustration and mistrust will drive affiliates away. Keep the commission structure simple, transparent, and easy to calculate.
Never try to swindle affiliates – affiliates must be certain that the operators they work with are reliable and trustworthy.
Can affiliates scam operators?
While operators can deceive their affiliate partners, the opposite practice is much more common. There are many different forms of iGaming affiliate fraud, such as using bot traffic, stolen customer information, redirected traffic, cookie stuffing, and many others, all of which are methods malicious companies use to artificially inflate their performance metrics for financial gains. As the gambling industry keeps expanding, these types of threats are becoming more prevalent, meaning operators need to allocate more resources to protect themselves. Check out our dedicated article on iGaming affiliate fraud to learn how you can protect yourself and your business from such threats.
A helping hand
Many operators go for affiliate networks or choose AffPapa – the iGaming directory, where operators and affiliates are brought together to connect and do honest business without the use of scams or fraud. Such platforms ensure that you are working with trustworthy affiliates who act responsibly and ethically.
AffPapa takes it a step further by including a section dedicated to iGaming complaints in the event of any dissatisfaction or misunderstanding.
We wouldn’t be giving you all this advice if we weren’t excited to present you with something great, would we?
If you want to collaborate with decent affiliates, we recommend you visit the Best iGaming Affiliates page, where you will find top-tier iGaming affiliates.
But, if you want to make things a lot simpler for yourself, you can sign up on the AffPapa website, where you’ll be able to directly connect with the ultimate iGaming affiliates and get your chance to message those affiliates directly through the system via other communication channels. This will allow you to get a head start on your numerous solid collaborations while also ensuring the security of your affiliate campaign.
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