Whether you are a new online poker affiliate or an affiliate that has been around awhile, chances are at one point you have asked yourself “which commission model is right for me?” You’ll see some affiliates swear up and down in support of a particular model, while others will argue passionately about another. In my seven years in the online poker industry, I have seen each of the commission models gain and lose favorability. Back when I first got into the affiliate marketing industry in 2004 as the Content Director for BW, we preferred revenue-share. There were tons of new online poker players discovering online poker and they were generating a lot of rake. Around that time rakeback started to gain steam and while our site did not really enter the rakeback game in any meaningful way until 2009, rakeback was clearly the place to be – at least in our market segment -- in the years after UIGEA in 2006. In the last couple years -- especially since Black Friday – we’ve seen much more focus on CPA deals as affiliates look for more of a “sure” bet. Even if we aren’t in some sort of CPA era there is clearly more interest in the model than there was a few years ago. There are some affiliates that will still swear by revenue-share while other affiliates continue to do well with rakeback. I will try to highlight the positives and negatives of each to hopefully give some of the less experienced affiliates a better idea of what system might be right for them. CPA CPA stands for Cost Per Action, also often referred to as Cost Per Acquisition. With CPA commissions, affiliates are paid a flat fee, often around $100-$200 for every qualified referring player that they send to the poker room. To qualify for sending a player to a room, at a minimum a player usually has to make a small deposit of at least $20-$50. Some poker rooms also require a minimal amount of rake to be generated by the player, often around $20. Pros: More of a sure thing versus alternatives, great if you send large numbers of lower rake generators. Effectively acts as insurance for adverse market conditions (more true of rooms accepting U.S. players). More control over the poker room. Cons: Some affiliates feel rake requirements are too steep (for sites that require them). Less upside compared to revenue-share. Not available at all poker rooms. Countries with low player value are banned (former Soviet republics, Brazil are a couple examples) Check out the CPA deals currently offered by PAS. Revenue-Share What it is: Revenue-share is a percentage of rake that referred players generate over the lifetime of their account, minus applicable affiliate deductions. Commissions for revenue-share affiliates are frequently in the 25%-50% range. Revenue-share has been the most common commission structure over online poker’s history. Pros: Huge upside. Available at most poker rooms. Cons: More risk and fewer guarantees than CPA. Deductions and affiliate terms can be changed. A list of revenue-share offers through PAS. Rakeback What it is: Revenue-share affiliates discovered fairly early that they could market to players by returning some of their revenue-share commissions back to players in the form of rakeback. Rakeback affiliates often pay players 30%-40% rakeback while receiving 5% to 15% in commissions (note: these days, most rakeback is paid by the poker room). Kickback and Free Bankrolls work in a similar way in that they award players some part of the affiliate’s commission (they differ from rakeback in that their base is usually a CPA deal). Pros: Very attractive to players which aids in increasing volume and retention. Increases player loyalty. Cons: Low margins. Competition. Administration of rakeback. Not available at the largest rooms. Model waning in popularity (primarily because many of the largest sites don’t offer traditional rakeback). PAS offers rakeback at over 15 poker rooms with even more VIP-based deals with the latter being based on non-rakeback revenue-share deals. Which Commission Model is Best? Even though you can get two equally savvy online poker affiliates to disagree with the “correct” system, I think one thing that affiliates can come to consensus on is that no model can concretely be applied to every affiliate. “It depends” is probably not what you want to hear, but it does really hinge on a variety of factors (the types of players you promote to, the nationality of the players, what rooms you are promoting etc). One thing to keep in mind is that you don’t have to use one system exclusively; perhaps you want to test one versus the other to see how they perform or even do some sort of back testing when you have enough data. Hopefully we have given you a good foundation to make a decision on the best model for your website and marketing efforts. If you have any questions or need any help on deciding what the best system is for you, we’d love to hear from you. Also, be sure to check out our article why some affiliates are choosing the PAS network model for their CPA and revenue-share offers.
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