The online gambling industry in the United States is expected to grow exponentially this year mainly because a number of states are looking to launch sports betting services. Sports betting was banned throughout America and only Nevada was exempted from the ban.
All that changed in May 2018, when the Supreme Court decided to repeal the Professional and Amateur Sports Protection Act (PASPA) of 1992 and empower individual states to make the decision whether to regulate sports betting or not.
The repeal of the sports betting ban was good news to sports betting operators but also to gaming affiliates as they play a critical role in driving traffic to sports books and online casinos.
Multiple States Legalize Sports Betting
The sports betting market is a multi-billion dollar industry and once PASPA 1992 was repealed, a number of states quickly passed sports betting legislation and launched their sports betting industry. New Jersey, Delaware, New Mexico and Rhode Island are some of the states that already have their sports betting market up and running.
California looks set to jump on the bandwagon even though there is a lot of opposition from tribal gaming operators. Reports suggest that there are another 10 states that are debating sports betting legislation and one can expect to see a quick expansion of sports betting across the country.
US Affiliates Set To Play A Key Role
Sports betting is a much bigger market than the online casino and online poker market. This also means that sports betting operators will have to compete fiercely to capture market share and build their player database.
This is where they will have to rely heavily on affiliate marketers who will play a key role in driving traffic to their sportsbooks. The gambling industry in the United States is heavily regulated and gaming operators don’t have a lot of freedom when it comes to advertising and running marketing campaigns to bring in new players.
While affiliate marketers will be queuing up to partner with the top sportsbooks and grab a piece of the pie, it isn’t going to be a very simple process. For one, sportsbooks and online gambling operators will have to be very careful in shortlisting their affiliate partners.
This is because they need to partner with reputed and trusted affiliate marketers who will run their affiliate marketing business in line with the gaming regulations of the respective state they are operating in. Affiliate marketers will also have to toe the line with regards to each sportsbook and iGaming operator’s affiliate marketing policies.
Gambling operators and sportsbooks have a lot to lose if they shortlist and use affiliate marketers who are willing to breach gaming laws in order to make a quick buck. So affiliates who have a strong market reputation will be at the top of the list when it comes to signing new affiliate partners.
State-Based Licensing Model – Slow Process
Gaming operators, sportsbooks and affiliate marketers will have to be patient as sports betting legalization operators on a state-based licensing model. While reports suggest there are 10 or more states discussing the possibility of legalizing sports betting, the process will usually be a long drawn out one.
This is because once sports betting is legalization, each state will have to come up with a regulatory framework and get that approved before it can be rolled out. The new gaming regulations will address a number of key topics such as the licensing process, licensing fees, tax rate and conditions that an operator will have to meet in order to qualify for a license.
Affiliate Marketers Need A License
The power of affiliate marketing is very evident when you look at the UK gambling market. Gaming operators in the United Kingdom have depended heavily on affiliate marketers to drive traffic to their sites and help them build their player database over the last decade. Reports suggest that close to one-third of all player registrations come via experienced affiliate marketers.
US gaming operators and sportsbook realize that one of the main ways they can stand out from the competition and do well is by partnering with power affiliates and reputed affiliate marketers. The gambling industry in the US is not as liberal as the UK and in many ways that is a positive for all stakeholders.
Affiliate marketers will also be required to obtain a state-based licensed before they can partner with legalized sportsbooks and iGaming operators. Betting firms and gaming operators are not allowed to bring on any affiliates who do not have a license from the state gaming regulator.
Affiliate marketers who receive a flat fee, as well as those who use cost-per-click promotions, can register for free with the gaming regulator. However, affiliates who get a revenue share must obtain an Ancillary CSIE licence which costs around $2,000. Affiliate marketers must also be prepared to make changes to their business model as they will have to comply with gaming regulations that can often differ from state to state.
There is no doubt that power affiliates or super affiliates will dominate the affiliate gambling market as they are powerful players in the industry and earn millions each month. However, this does not mean that there is no place for medium sized affiliates. It just means that they will have to compete harder and focus on niche markets in order to be successful and drive regular traffic to sports books and online gambling websites.