Compounding Bad Decisions
Back in April I shared my thoughts on Betsson's strategy of opening a separate room on Entraction and offering rakeback . Now they have Betsson and Betsson Euro Tables. The Betsson Euro…
Back in April I shared my thoughts on Betsson’s strategy of opening a separate room on Entraction and offering rakeback. Now they have Betsson and Betsson Euro Tables. The Betsson Euro tables are Euro denominated (surprise) and on the Entraction network which apparently is allowing skins to offer rakeback to their players.
In my previous post I made the case for why I felt this was a mistake on Betsson’s part. In case you’re too lazy to read it, I think it creates some problems for any poker room trying to offer two different value propositions. On top of that you’re basically making 100% of your signups affiliate based since you’re going to be paying out roughly the same percentage that you would have paid to an affiliate to the players. This sort of goes in the wrong direction where the bigger a room gets the more it wants to distance itself from reliance on affiliates to increase their profit margins.
The reason I’m writing about this topic again is that I received an email from Betsson offering me 30% rakeback.
It seems as if they’re blanketing their user base with the offer.
When I originally wrote about this I quoted their email to affiliates which said:
Betsson Poker:
-Launching a secondary Poker network on the Entraction platform only in Euros, which will also offer rakeback only for players coming in through affiliates.
-This will guarantee higher loyalty amongst your players and higher lifetime value.
But the problem is that if I’m a MGR affiliate Betsson is killing my revenue by enticing my players to go get rakeback. If I was on a 30% revshare deal with Betsson and now my player moves over to Betsson Euro I’m pretty sure Betsson isn’t going to pay me 30% and the player 30%. Maybe they give me a 5% cut but I was making 30% before so I’m losing 25%.
I can’t imagine many MGR affiliates are going to be giddy with the news despite Betsson’s assurances of higher loyalty (untrue - rakeback players are some of the most disloyal) and higher lifetime value (to who, Betsson or the affiliate?).
There’s also the issue of the affiliate market being split into two groups, rakeback affiliates and non-rakeback affiliates and one need only check out the Poker Affiliate Listing forums to see that the two groups don’t see eye to eye. So, what Betsson is doing is sure to anger one group (non-rakeback affiliates) and force them to cozy up to the other (rakeback affiliates).
The only problem in this scenario is that the rakeback market is already pretty crowded. On Rakeback Report we have nearly 30 different poker sites offering rakeback. And it’s not like these are small brands. Full Tilt, Absolute, UltimateBet, Carbon, Cake, Paradise Poker, PKR, Doyle’s Room, and Betfair are just some of the rooms offering rakeback deals. What’s Betsson going to offer that will make it stand out in that crowd? Full Tilt, Absolute, UltimateBet, Carbon, and Cake sell themselves.
The big question is, what would make an affiliate push Betsson over any of those other brands?
To be honest, I don’t know. I don’t know because that email I quoted above has been the only affiliate communication I’ve received about it. Their June newsletter didn’t even mention poker. Maybe they’ll explain what their plans are in future communications but at the moment my only read is that they might get a slight boost from reactivating lapsed/dormant players who have been playing elsewhere but unless they’ve got a card up their sleeve that they’re not revealing I can only see this lead to an eventual decline in revenues.