In Part 2 of his dissection of the state of online bingo, affiliate-turned-operator Phil Blackwell looks at ways the the sector can restack the odds in its favour
The opportunities for operators (and threats to affiliates)
Fortunately, there are ways for UK bingo operators to minimise the impact of increased costs while actually increasing the attractiveness of their brand to players.
Strip bonuses and wagering requirements to limit tax exposure
You can’t be taxed on bonuses if you don’t offer them. At MrQ, we have a single real money wallet for players with a welcome bonus of free tickets to a free bingo room and genuine free spins.
We are not exposed to the expenses that accompany large match-deposit offers, but instead limit our liability to the value of the spins only, assuming positive GGR.
“Keep what you win” is a far stronger proposition than “keep what you wager”, but it does require marketing to overcome player expectations of large bonuses and uncover this nuance, especially in a long list of affiliate sites.
Other recently launched no-wagering bingo brands include Playtech’s Buzz Bingo and the entire Dragonfish Real Bingo Network, although the latter does cap player winnings.
Build a brand with real USPs
A renewed focus on retention is an obvious and overlooked answer to rising acquisition costs and taxes. If you do manage to get players to your brand without a bonus, you’ll want to give them reason to stick around.
The white label nature of the online bingo industry is not set up to excel in the realms of originality and brand building. Identical software and welcome offers presented by different names and logos is nothing more than painting the same car a different colour.
The boom of white label bingo sites allowed smaller operators to quickly and easily make money online with little regard for the quality of the product ultimately being sold.
It is, of course, not easy to create new software from scratch, especially for small- to medium-sized bingo operators, but the market is agnostic to the challenges of individual businesses.
At Lindar, we built MrQ with a small team of under 20 people and benefited from our flexibility and ability to react fast. Retaining this while continuing to scale will almost certainly be more difficult, but the success of other proprietary brands such as Tombola and Mfortune suggests that it is not impossible.
In fact, it might be essential. Paying more in one area can be balanced by paying less in another. If existing brands fail to react, we could see an emergence of new operators into the industry similar to the rise of challenger banks in finance like Revolut, Tide and Monzo.
Standalone bingo platforms offer the chance for operators to develop real and authentic brands, supported by unique and progressive concepts, with the added benefit of paying less commission to third-party integrations. It’s hard to stand out from the crowd if you’re not outstanding.
Diversify into new markets and territories
It’s no secret that the majority of bingo sites find their best player value on slots. From an affiliate and PPC perspective, it is more expensive to acquire slots and casino players directly than it is to attract bingo players and later migrate them to instant games.
The same logic can be applied to other products too. Lottery, for example, is bingo’s bigger brother with obvious crossover in game mechanics, if not payout. Lottery players are also cheaper to acquire.
The rush to diversify product offering is already happening with casinos and the rapid inclusion of sportsbooks to traditionally non-sports websites. One of the first big brands to do this was Mansion Casino in 2018 with MansionBet, more recently followed by 888’s acquisition of sports betting platform, BetBright, for £15m.
Diversify acquisition sources
Another way to balance costs and maintain ROI is to expand a brand’s range of traffic sources to incorporate or increase exposure on cheaper channels.
This could leave more expensive affiliates especially at risk should increased taxes make existing high commissions less profitable than they were before.
One of the most cost-effective (and most complex) player sources is SEO. Although frequently mistaken as ‘free’ traffic, SEO does require considerable effort, diversity and investment from brands looking to take rankings seriously.
Sites that already rank well for high-volume keywords may be best placed doubling-down their spend on organic search instead of increasing budgets for PPC.
A couple of years ago I wrote another article in iGB Affiliate (issue 63) entitled ‘Why do bingo affiliates rank so badly on Google?’. Naturally, this caused controversy with the handful of affiliates that didn’t rank so badly on Google, but the retaliations ignored my core premise.
This was that Google prefers to rank operators for search terms with ‘play now’ intent, and affiliates for those implying comparison or lists.
For example, back in 2017, not a single affiliate website ranked in the top 10 pages of Google for the keyword ‘online bingo’, and conversely, only a handful of operators ranked in these positions for (usually pluralised) keywords including ‘bingo sites’ and ‘new bingo sites’.
This is still pretty much the case even today. However well optimised a bingo operator or affiliate may be, they will likely remain somewhat restricted in ranking opportunities for phrases that do not match Google’s implied intent.
So much so, in fact, that we’ve started to see operators create their own affiliate portals to gain exposure to typically affiliate-dominated results pages; something that GiG did late last year with SuperLenny Casino.
In the most Orwellian of circumstances, affiliates could not only see current deals reduced or removed but also find themselves competing for clicks with former partners in Google search.
Bet to the future
Despite all of the above, the iGaming industry should really be counting its blessings.
The Government’s decision to restrict FOBTs but leave online stakes uncapped is surprising, and certainly hypocritical, but also incredibly lucky.
Online gambling still flies under the radar of most taboo-fetishising media publishers. The humble betting shop, for so long an accepted feature of British high streets, has become the fashionable focus of outrage.
The Government’s hand was forced by a relentless press campaign guided by an insincere concern for responsible gambling. The Chancellor reacted by increasing taxation elsewhere.
These changes scream of politics, not protection. But it’s only a matter of time until his hand is forced again. It’s only a matter of time until a Guardian journalist realises that players can stake £200 every five seconds sitting at home on the toilet.
It’s only a matter of time until the Government is forced to restrict online bets in the same way as it has offline bets. It’s only a matter of time until RGD rises even further to compensate for the loss of revenues.
It’s time to stack the odds in our favour, because time is running out.
Phil Blackwell is acquisition operations manager at Lindar Media and responsible for the growth of affiliate site OnlineBingo.co.uk and proprietary bingo platform MrQ.com. In previous agency roles, Phil devised SEO strategies for multinational clients including Ebay UK, New Era, Mothercare and Carphone Warehouse.