Opportunities Emerging for US Sports Betting Affiliates: Good News in MA With New Designation

Written by:
C Costigan
Published on:

  • 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 continues to resemble the Wild West
  • Savvy affiliates will quickly realize that only targeting residents of a state that allows sports betting is short-sighted

Online gambling affiliates are watching and waiting for the U.S. sports betting market to further develop.  Until now the industry has been mostly dominated by the so-called "super affiliates" in the space.  Then there are established media companies and mainstay well-funded gaming industry news and forums.  

The little guys?  They get the crumbs. It takes exceptional SEO and marketing skills to compete.  We here at Gambling911.com continue to see very reckless efforts at marketing these sites through the exploitation of news aggregators like Google News.

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

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 and Murphy as confessed its been tough at times.

"European markets, for the most part, break down country-by-country," Murphy explained shortly after the U.S. Supreme Court overturned prior sports betting prohibition.  "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 four years now, the affiliate sports gambling industry in the U.S. continues to resemble the Wild West, very much like the early days of online gambling across the globe.

Some states are stricter than others when it comes to qualifying affiliates like Murphy.

One of the industry's most renowned attorneys, Jeff Ifrah, announced December 1, 2022 a bit of good news coming out of Massachusetts.

The commonwealth this year approved legalization to offer sports wagering. Originally, MGC considered marketing affiliates were slated to fall under the state’s definition of a “sports wagering vendor”.

Ifrah explains why designating affiliates as sports wagering vendors in Massachusetts would have its downside.

This characterization meant that the MGC put marketing affiliates in a category for any entity deemed to be providing services directly related to the operations of sports wagering, like platform service providers and geo-location service providers. For all sports wagering vendors, including marketing affiliates, the MGC appeared to seek to apply a licensing procedure similar to that which the MGC currently requires of slot machine manufacturers. The sports wagering vendor licensing requires in-depth business and personal disclosures of key personnel, owners, and certain officers.

Instead, it's been agreed that affiliates will be registered, as opposed to licensed.

According to Ifrah, Massachusetts Director of the Investigations and Enforcement Bureau, Loretta Lillios, "was shocked to see that operators listed hundreds of marketing affiliate partners."

Director Lillios noted to the Commission that licensing all of the affiliates, as currently contemplated, would be too heavy of a burden for her department to handle in a reasonable timeframe and not all of the vendor licensing procedures are necessarily pertinent to marketing affiliates.

There's good with the bad however. Funding one's wagering account with a credit card does not appear to be in the cards at this time.  That policy could negatively affect conversion rates. Debit cards, on the other hand, will be permitted.

In the Beginning...

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 served as a great example the first few years since legalization.  Companies were advertising heavily via local television and radio affiliates, most  of which were not based in the state.  That's because New Jersey's northern media market is courtesy of New York City.  The Southern portion of the state receives television stations via Philadelphia.  Northern New Jersey's primary print and electronic media outlet is the Newark Star Ledger (NJ.com).  It has become one of the largest online gambling affiliate marketers in the state.

Lots of folks travel to New Jersey for business and pleasure.  The Jersey Shore has long been popular with Canadian tourists (i.e. Wildwood).  Simply put, an affiliate's target NJ bettor might not actually reside there.

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 practically beat New Jersey in its quest to offer regulated sports gambling.  To this day, the state does not offer mobile outside the casino property.  Tunica is hugely popular with gamblers from throughout the Southeast, Missouri and Tennessee.  Once the Tunica properties opened, much of the search traffic originated from nearby Memphis, Tennessee.  Ironically, the Volunteer State would go on to offer regulated internet-only sports betting as Tennessee does not have any casinos. 

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. 

They tried early on but seem to have abandoned the strategy of late.

Alas, there are dozens of bars and similar venues set to begin offering legalized sports betting in the state of Ohio.  It's easy to see how gaming affiliates might want to join forces with establishments the industry giants will likely ignore.

Ohio unfortunately represents what's gone wrong with the burgeoning industry.  The US Justice Department just announced federal charges against that state's former House Speaker Larry Householder.  They accuse him of a pay-to-play scheme used in a bid to attract sports gambling to the state.

A lobbyist involved with the alleged plot and named in the complaint has since committed suicide. 

- Chris Costigan, Gambling911.com Publisher

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