Bojoko argues that “contractual security is a must” as the online casino comparison platform makes a series of recommendations following the creation of an industry study looking at the fees operators apply to affiliate revenue and the effect this has.
The aim, according to the company, is to not only start a discussion about fees and accountability, but also to actively recommend ways to strengthen the relationship between operators and affiliates.
Audit of the igaming organisations
To do so, Bojoko conducted an audit of the igaming organisations with which it has a 45 percent revenue sharing arrangement listed on its website to see what is currently collected after fees have been deducted.
The lowest net revenue after fees was found to be 8 percent, according to the results. With 18 of the audited casinos charging fees of less than 16 percent, this is a good sign.
On the other hand, the highest revenue share after fees was estimated to be 40.8 percent, with the average reported to be 23.9 percent.
Joonas Karhu, chief business officer at Bojoko said: “Some operators offer affiliates a 45 per cent revenue share but leave them with close to zero earnings after their fee deductions. The breakdown of fees is far from transparent in the current environment.
“When an affiliate works with a revenue share, some costs definitely need to be split evenly in proportion to the revenue share. It’s a partnership, after all. However, most of the costs that operators currently impose on affiliates are predatory and without merit.
“This is mostly due to the fact that it’s a young industry and affiliates have not yet learned to negotiate commercial agreements.”
The group makes a series of recommendations in the report to improve transparency, including an even revenue share split, better communication from the online casino to the affiliate, more transparency in affiliate advertising, more affiliates questioning what they receive from partners, and an industry conversation about the fees that cassino’s charge.
Furthermore, Bojoko mentions the Professional Gambling Affiliates Association, which was established in October 2020 and aims to “address the imbalance in the relationship between operators and affiliates,” according to the company.
Contractual security for both parties
Karhu continued: “This is a breakthrough moment for both operators and affiliates, providing contractual security for both parties around key areas of any working relationship and commercial agreement.
“Affiliates have long played a vital role in driving new players and first time depositors to online casinos, and the PGAA contract ensures they are rewarded fairly for doing so.
“Transparency is absolutely key to trust, and by building an additional layer of trust into these partnerships we can ensure they are long and successful.
“Revenue share agreements and fees have been an area of concern for some time now, but with our contract we can overcome these for the benefit of both parties.”