Considerations on affiliate programmes: in-house or outsourced

In lieu for a preparation for a panel discussion here goes a few considerations on affiliate platforms: in-house or outsourced?!

My overall gaming experience includes managing marketing campaigns and affiliates for a poker school, online casino and now for one of the leading online poker and online casino operators. During that time I had been working directly with affiliates via simple tracking platform, via proprietary platforms and via the network - Income Access.

Generally speaking, the question is purely about business models employed and marketing strategies.
Marketers should take this into account when making this decision and four major principles would be lock-in, efficiencies, innovation and complementarity.
It creates value for affiliate channel and drives a decision whether those platforms should be in-house or outsourced.
Same with affiliates - they need to recognise how it is more beneficial for them - how do they create more value for themselves (receive it from direct relationship or via managed outsourced solution).



In example
a) let's take a gaming affiliate who purely concentrates on promoting online poker in France. Are there any other offers that he is interested in? No. Where is the competitive advantage here for an affiliate network - there is almost none, with a dozen of operators affiliate can effectively manage relationships himself.
b) if we take affiliate who is promoting multi-sector programmes it becomes obvious that he cannot effectively manage and communicate with hundred affiliate managers and for there sake of efficiency and technical tracking innovations, and also complementarity he is to work through the network.
Operators should acknowledge this and decide on the most effective strategy for themselves depending on the business (and business models).

So in example of my current employer - there is not so much need for us to go through networks for poker (being longstanding in-house programme), but if we are talking about UK online casino and other territories where it is legal then I would be more than prepared to discuss network opportunities to get greater access to affiliate pool and save effort and budget on affiliate recruitment.

Taking about the costs it is worth mentioning that own in-house programme would impose mostly fixed costs, whereas outsourced would carry on mostly variable costs based on number or volume of sales.

That means that the operators - newcomers would face a barrier to create their own platforms because of high fixed costs and also time for recruiting affiliates for it (that would be generally even bigger cost because it would require talented affiliate managers to sell the porhramme already packed with promotions and other selling points as competitive advantages).

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