Operators and Affiliates Must Embrace and Understand Compliance Requirements

Written and Published by: https://www.gamblinginsider.com on Thursday, 12 September, 2019
Unfortunately the original article is offline, this is an archived version:

Anyone involved in the online gaming industry would have to have been sleeping under a rock for the past few years to have not felt the effect of increased regulation in the UK market, as it has been increasingly intensified by the Gambling Commission.

In fact, the latest levels of industry regulation have had a marked effect on all channels of online communication – including digital affiliate marketing. Affiliate channels used to be described as the wild west of gambling marketing, with a few nefarious webmasters promoting welcome offers through unsavoury methods or contacting players who had self-excluded.

A lot has changed and to be fair, this has been an unjust view for quite some time now.

The Gambling Commission made it abundantly clear to operators they were being held responsible for the marketing activity of their affiliates, regardless of whether the affiliate deviated from industry regulation or marketing guidelines.

Major industry players such as Ladbrokes, 888, Sky Bet and Casumo weathered a blistering backlash from the infamous Facebook post of ‘William’ who was said to be £130,000 ($158,000) in medical debt from his wife's hospital bills before ‘stumbling upon an ad for Sky Vegas.'

The post went on to say: “With little to no money to spend, he admits he laughed and almost scrolled past it until he saw they were offering a promotion that would reward him with £10 free at the Jackpot 7 game, which, at over £700,000, was too hard to pass up.” This led to a growing movement by some of the largest operators to get tough on rogue affiliates.

With ever-growing compliance departments, brands set about establishing strict guidelines for accepting affiliates and developing audit controls to ensure effective monitoring. Affiliates who were sending direct mail promoting offers from brands have been severely cut post-GDPR and marketing must now comply with Advertising Standards Authority and Gambling Commission requirements.

Aside from curbing affiliate marketing channels, operators had other regulation challenges like salient terms and conditions on-site, with full terms and conditions just one click away, no child-friendly images, no under-25 athletes depicted and, most recently, no demo-play prior to age verification.

All of this has had a massive impact on the sportsbook and online casino industry. But those betting types are not the only area of concern. Recently, Bristol University took part in a research project funded by GambleAware that showed 17% of followers of esports-related gambling accounts on Twitter were 16 or under. Another study, by gambling industry specialists Regulus Partners, found one in eight 11-to-16-year-olds follow a gambling company on social media.

Those who do are three times more likely to spend money on gambling. This does not make for pleasant reading, and it’s clear we still have quite a distance to go in tackling underage gambling. We have even seen large operators move away from affiliate marketing altogether, as they look to reduce their risk exposure, or strive to work with trusted affiliates only.

For most operators, it’s clear that digital affiliate marketing is still a viable channel when webmasters are suitably vetted before promoting offers for top operators. Aside from that, larger affiliate marketing partners have begun to embrace compliance, as they understand its necessity. On the other side of the coin, affiliate marketing generates traffic that is otherwise very difficult to achieve for the emerging sector of smaller and niche operators.

Thankfully, new technology such as Rightlander and GiG Comply automates compliance and KYC standards, alleviating the incredibly manual process of auditing affiliates one by one, and enables affiliate marketing to continue in the UK. Operators and affiliates must embrace and understand compliance requirements and work with regulators for the betterment of the industry, so we can all mutually continue to thrive without putting vulnerable players at risk.