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Opportunities Emerging for US Sports Betting Affiliates?

Written by:
Guest
Published on:
Aug/23/2018

  • Affiliates looking to tap into the U.S. sports betting market will want to think of each state as a separate country
  • For now the emerging U.S. sports gambling market will resemble the Wild West
  • Savvy affiliates will quickly realize that only targeting residents of a state that allows sports betting is short-sighted


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How Will the Sports Betting Affiliate Market Evolve in the States?

Online gambling affiliates are watching and waiting for the U.S. sports betting market to further develop.  Will there be money in it for them?

Mike Murphy of BettingUSA.com says that affiliates already doing business in Europe and elsewhere should think of the U.S. as 50 different countries.  Each will have their own unique regulations.

"European markets, for the most part, break down country-by-country," Murphy explains.  "In this way, we can compare the US market to the European market as a whole rather than as simply the addition of one more country to target."

For now on, the emerging U.S. sports betting market will be like the Wild West, very much like the early days of online gambling across the globe.

New Jersey's top regulator admitted as such in a recent interview with LegalSportsReport.

“I think we have a lot of support, but the proof in this in the long run is going to be out actions and our efforts as we move into the future," New Jersey Division of Gaming Enforcement Director David Rebuck said.

“I wouldn’t expect anything other than what we’re subtly doing behind the scenes right now.”

Don't expect the party to last for long though, at least where affiliates are concerned.

"Compliance will also become an important issue going forward, similar to what is happening in the UK market today," Murphy says.  "Affiliates will also have to keep in mind that their US traffic comes from potentially fifty different states. Do they have a plan for promoting the correct programs to the correct traffic? Geotargeting and ring fencing will be very important unless a federal law takes shape, which we see as very unlikely."

The UK market this year began requiring online gambling operators to abide by specific rules that were passed down to affiliates.  This resulted in stalwarts like Bet365 booting some affiliates while forcing others to incorprate specific language in coveted review pages.

Early Signs

Where New Jersey is concerned, the online gambling market is nothing new.  Almost immediately when the industry was adapted, affiliates doing business with unregulated sites still accessible from the U.S. quickly discovered the obstacles. 

When online casino and poker became legal in the state, New Jersey's Attorney General issued a warning to a number of affiliates and ad partners, Gambling911.com included, they would not be able to advertise offshore gambling sites along side those that were licensed in the Garden State.

That move all but scared most established affiliates away.  This meant doing away with thousands of dollars in revenue per month few were willing to part with, especially in a market that quickly became saturated.  A handful of savvy affiliates started New Jersey-only websites or cut off the offshore site banner exposure in that state.  New sites won't have the traffic right away, so that's a catch 22.

The capture rate will also be relatively low considering the market reach.

Focus on One State Not as Easy as it Sounds

Sports betting in New Jersey and other states appeals to a significant number of those who do not necessarily live in the state where the activity is currently legal.

New Jersey serves as a great example.  Companies are currently advertising heavily via local television and radio affiliates, none of which are based in the state.  New Jersey's northern media market is courtesy of New York City.  The Southern portion of the state receives television stations via Philadelphia.  New York state isn't ready for legalized sports betting just yet.  Pennsylvania is, but players may find themselves paying the price for outrageous operator licensing fees and high taxation. 

Lots of folks travel to New Jersey for business and pleasure.  The Jersey Shore has long been popular with Canadian tourists (i.e. Wildwood).

But New Jersey isn't necessarily the best example when it comes to those visiting from out-of-state to take advantage of sports betting.

Mississippi is another state that has already jumped on the sports betting bandwagon.  Tunica is hugely popular with gamblers from throughout the Southeast, Missouri and Tennessee.  Once these casinos go online, sky is the limit for would be affiliates. That's because they can target these gamblers prior to coming to Tunica.

Case in point: When Mississippi announced it would be legalizing sports wagering, nearby Memphis became the top traffic referring U.S. city to the Gambling911.com website, bar none (previously it was the usual suspects: New York, LA, Chicago, etc...)

Thinking Outside the Box

Perhaps the most enticing business model is that suggested by a major national sports bar chain the likes of Buffalo Wild Wings. Now owned by Arby's parent company, Inspired Brands, Buffalo Wild Wings could easily tap into a prized sports betting segment affiliates already cater to.  It is not far fetched to think a chain like BWW would pay flat fees to some of the more trafficked sites just to get them in their restaurants a la promo offerings.  And what would they care about having their banners flash along side YouWager?

In the end, content is king and restrictions don't make for good content

"Search will remain king for profitable traffic," Murphy says, with good useful content always benefitting from the search engines like Google, Bing and Yahoo.  "Especially with the fractured market state by state leading to many confused customers wondering where and what they can play, how to deposit and fund accounts, and what can be bet on.

- Chris Costigan, Gambling911.com Publisher

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