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Place Your Bets: Hear the Experts
Discuss Operating as a US iGaming
& Betting Affiliate
States with legal sportsbetting or Active Bills
14 months of Progress!
States with legal sportsbetting (or pending this month)
• Live today (10 states)
• Likely end 2019 (7 states)
• Legislatio...
• Live today (10 states)
• Likely end 2019 (7 states)
• Legislation introduced in
2019 (16 states)
• Online Gambling Legal...
State-By-State Daily Fantasy Sports
Basics of Online Gaming Market in USA
• Online Gaming consists of five distinct verticals, each regulated very differently...
Basics Facts of iGaming Affiliate Marketing
• Land based casino operators have used ‘affiliate’ like marketers for decades...
Basic Facts of iGaming Affiliate Marketing
• Casino was launched in New Jersey in 2013
• Sportsbetting was launched in New...
Licensed Affiliate Options
Industry Service Provider
• Revenue share of 30-45%, of NET
revenue or CPA
• For each depositin...
Size of the Market
Size of the New Jersey iGaming Market
$5.2 $93.8
$125.1
$167.1 $220.3
$277.3
$495.9
$8.4
$122.9 $148.9
$196.7 $244.6
$352....
Opportunity: Sports Betting is a Game Changer
• In New Jersey (where legal) mobile represents the vast majority of the rev...
DFS Brands Have Dominated New Jersey
• FanDuel and DraftKings has 80% of the sportsbetting market
• Negative: Bad for affi...
Pennsylvania is Still Too Early to Tell
• FanDuel Retail has 9% market share (located outside Philadelphia)
• Online only ...
Steps to become a licensed affiliate
Tips and Process to Becoming iGaming Affiliate
• Hire a gaming lawyer or professional regulatory person in local market
• ...
How Big is the Opportunity
Source: Eilers & Krejcik, iGaming Capital
Operating as an iGaming Affiliate in the USA
• Licensed activity – need license to operate
• Very content driven mainly de...
Thank you!
Melissa Blau
Founder & Director
iGaming Capital
melissablau@igamingcapital.com
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Place Your Bets: Hear the Experts Discuss Operating as a US iGaming & Betting Affiliate

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Solo session led by Melissa Blau

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Place Your Bets: Hear the Experts Discuss Operating as a US iGaming & Betting Affiliate

  1. 1. Place Your Bets: Hear the Experts Discuss Operating as a US iGaming & Betting Affiliate
  2. 2. States with legal sportsbetting or Active Bills 14 months of Progress!
  3. 3. States with legal sportsbetting (or pending this month) • Live today (10 states) • Likely end 2019 (7 states) • Legislation introduced in 2019 (16 states)
  4. 4. • Live today (10 states) • Likely end 2019 (7 states) • Legislation introduced in 2019 (16 states) • Online Gambling Legal (3 states) States with legal sportsbetting (or pending this month)
  5. 5. State-By-State Daily Fantasy Sports
  6. 6. Basics of Online Gaming Market in USA • Online Gaming consists of five distinct verticals, each regulated very differently 1. Casino 2. Poker 3. Sportsbetting 4. Bingo 5. Lottery • Online gaming is strictly a state by state initiative (10th amendment) • There are three different types of entities that are authorized to operate and/or administer sportsbetting and online gaming 1. Commercial casinos 2. Tribal casinos 3. Lotteries • In USA, each state has taken a different approach to sportsbetting and online gaming when it comes to operating entity and product vertical
  7. 7. Basics Facts of iGaming Affiliate Marketing • Land based casino operators have used ‘affiliate’ like marketers for decades through the form of junket providers • Affiliates are paid by revenue share or CPA (deposit only) • Online gaming for commercial casinos is only legal is two states • New Jersey (2013) and Pennsylvania (2019) • Nevada offers ‘variant’ mobile wagering but requires in-person signup • West Virginia false start with Betlucky. Expected to relaunch with FanDuel by NFL season • Lottery: Michigan and Pennsylvania offer revenue share and require no license
  8. 8. Basic Facts of iGaming Affiliate Marketing • Casino was launched in New Jersey in 2013 • Sportsbetting was launched in New Jersey in August 2018 • Mature Markets: Casino represents 50% of the revenue but sportsbetting represents 70% of the players • Affiliate marketing is a highly regulated business for online gaming for commercial casinos • Requires a license issued by each state • The costs depends on size/complexity of organization and type of license • Ranges between $2,000 and $50,000 (estimation) • Both New Jersey and Pennsylvania offer the same licensing regime • Ancillary Service Industry Provider. Revenue share. Performance based on a percentage of revenue less agreed hard costs deductions (tax, promotions etc) • Cost per Action (deposit): fixed
  9. 9. Licensed Affiliate Options Industry Service Provider • Revenue share of 30-45%, of NET revenue or CPA • For each depositing player • Gross to Net: hard costs expenses (taxes, promotions, maybe other) • Term: TBD min of 2 years to indefinite • Allowed to act as a super affiliate (needs to be flushed out) • Very onerous licensing: 5 years of taxes, all monthly statements, no access to safety deposit box etc. • Higher Licensing costs Vendor Registration • CPA: Cost per acquisition • For each depositing player • Range varies by vertical: Casino higher than sports and poker • Range: $175 - $700 • Depends on total number of depositing players and quality of traffic • Lower costs for licensing and much less invasive questions
  10. 10. Size of the Market
  11. 11. Size of the New Jersey iGaming Market $5.2 $93.8 $125.1 $167.1 $220.3 $277.3 $495.9 $8.4 $122.9 $148.9 $196.7 $244.6 $352.3 $751.2 $- $100.0 $200.0 $300.0 $400.0 $500.0 $600.0 $700.0 $800.0 2013 2014 2015 2016 2017 2018 2019 iGaming GGR Revenue New Jersey Casino Poker Sports
  12. 12. Opportunity: Sports Betting is a Game Changer • In New Jersey (where legal) mobile represents the vast majority of the revenue • Online is 80% of the revenue for sports betting New Jersey (where both are legal) • Retail only states will need to expand to offer online to be successful • Sports betting drives online casino revenue • Online casino doubled since Draft Kings launched its casino • New opportunities on numerous fronts: more states, new brands, addition of casino or sports betting • Increased competition from affiliate community with introduction of sports betting 82.0% 18.0% Online Dominates NJ Sports Betting GGR YTD Online Retail
  13. 13. DFS Brands Have Dominated New Jersey • FanDuel and DraftKings has 80% of the sportsbetting market • Negative: Bad for affiliates as they are only compensated for new depositing players • Positive: incumbent and other brands need affiliates • As new states open or expand to add online, non-FD/DK brands will need to include affiliates 83% 17% NJ Online Only Sports Betting Revenue FanDuel/DraftKings Rest of New Jersey 80% 20% NJ Total Sports Betting Revenue FanDuel/DraftKings Rest of New Jersey
  14. 14. Pennsylvania is Still Too Early to Tell • FanDuel Retail has 9% market share (located outside Philadelphia) • Online only launched in May with one online sportsbook (Sugarhouse) • Now three online sportsbooks with several more expected to open before NFL start • FanDuel and Draft Kings have not launched their online sites • Online Casino not live yet Retail Sports betting GGR Pennsylvania
  15. 15. Steps to become a licensed affiliate
  16. 16. Tips and Process to Becoming iGaming Affiliate • Hire a gaming lawyer or professional regulatory person in local market • Each affiliate must be sponsored by a local casino in the state • This must be completed first • Complete the forms • Have your regulatory lawyer review everything before submitting • Ancillary license: requires on site fingerprints (not sure about vendor registration) • Contact the Casino or Sports books affiliate managers • Read the restrictive terms and conditions before doing anything
  17. 17. How Big is the Opportunity Source: Eilers & Krejcik, iGaming Capital
  18. 18. Operating as an iGaming Affiliate in the USA • Licensed activity – need license to operate • Very content driven mainly dependent on reviews and articles • All contracts must be approved by Gaming regulators • No ability to pay any company supplying services to affiliates based on any performance metric tied to gaming • E.g. Revenue share, CPA, depositing new players, signups, active players • Sub-affiliate (if licensed with super affiliate) required to have Vendor Registration license (paid on CPA) • Only metrics allowed are monthly, hourly, annual fee – solely not tied to performance • Restrictions on message to players monitored by casinos and regulators • Periodic valuation forms that describe your acquisition strategy and marketing message • No ability to advertise on Google in a straight forward manner • Facebook permission is difficult to obtain and may be taken away at any time • Outside of external marketing tools, not entirely well managed at this time but getting better (cookie stuffing etc) • CPAs and Revenue share can be very lucrative especially in new markets
  19. 19. Thank you! Melissa Blau Founder & Director iGaming Capital melissablau@igamingcapital.com

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