GPWA Times Magazine - Issue30 - October 2014

consider California. It's the largest state in the union, with a population exceed- ing 38 million. The California legislature had two online poker bills under con- sideration this year. Although both bills were recently shelved, Assembly member Reggie Jones-Sawyer, the driving force behind one of the pieces of draft legisla- tion, announced he’d introduce a new bill in December. The Golden State isn’t the only major po- tential new iGaming market. In May, an updated online poker bill was introduced in the New York state senate, while neigh- boring Pennsylvania published a favor- able study on the impacts of legalizing iGaming the same month. In short, the future for iGaming affiliates looks bright. Alternative ways of monetizing U.S. traffic Promoting regulated brands in the Gar- den State will provide affiliates with an important source of revenue, but their short-term strategy shouldn’t start and end in New Jersey. Long-term growth and success depend on exploring all cur- rent U.S. opportunities. This means de- veloping a multi-pronged, short-term ap- proach that includes New Jersey brands, but also leverages the alternative verticals of horse-race betting, fantasy sports and social gaming. To date, the residents of 22 different U.S. states are legally allowed to place online bets on horse races. The group includes some of the most densely populated states in the country, including California, New York, Florida, Illinois, Ohio and Michigan. These states alone account for 112 million people. America’s passion for the Ken- tucky Derby, Preakness Stakes, Belmont Stakes and other equestrian events means there are huge revenue opportunities in promoting the growing number of online horse-race betting brands. To complement their horse-racing brands, affiliates should also diversify by devel- oping partnerships with paid-fantasy- sports operators, the Unlawful Internet Gambling Enforcement Act (UIGEA) ex- empted fantasy sports, even paid ones allowing players to win real-world priz- es. And with the increasing popularity of daily fantasy sports, a steady revenue stream from fantasy sports players is now possible. (For more on daily fan- tasy sports, see Dan Podheiser's story on page 44.) Fortunately, the vast majority of U.S. states – with the exception of Arizona, Iowa, Louisiana, Montana and Washing- ton – allow their residents to play paid fantasy sports. The Fantasy Sports Trade Association (FSTA) estimates that there are more than 41 million fantasy sports players in the U.S. and Canada. The mar- ket’s size, coupled with researcher IBIS- World’s estimate that it generated $1.1 bil- lion in revenue in 2013, should be enough to convince affiliates to get a slice of the American fantasy pie by promoting lead- ing brands like FanDuel and DraftKings. By marketing paid fantasy sports, affili- ates will be appealing to a demographic that the FSTA defines as predominantly male (80 percent) and relatively young (an average age of 34). Affiliates can en- sure that they’re appealing to a more di- verse demographic and therefore convert- ing as much of their traffic as possible by also promoting social casino brands. Data from IGT and Macquarie Research sug- gests that more than a third of social ca- sino players are women and players tend to be slightly older (the average age is 38). Promoting social casino brands will do more than just optimize affiliates’ conversion rates by ensuring that their sites appeal to as broad a demographic as possible. Social brands also offer affiliates the largest U.S. demo- graphic potential, as the vertical is currently legal in all 50 states. SuperData Research estimates that there are 35.4 million U.S. so- cial casino players, so joining a social gam- ing affiliate network specializing in social casino brands is a logical step. The affiliate's next step could be promoting real-money iGaming, as many U.S. land-based operators are developing social brands to prepare for state-by-state regulation. By diversifying their offerings to include social gaming, paid fantasy sports, online horse-race betting and regulated real- money brands, affiliates can develop a U.S. strategy that stands the test of time. In the short term, they’ll be able to opti- mize the monetization of their traffic from as many states as legally possible. Beyond the now, however, this strategy will allow affiliates to balance short-term revenue with long-term growth by help- ing them build player bases and develop relationships with U.S. operators and ser- vice providers. As the Nevada and New Jersey markets mature and as California, New York and Pennsylvania consider reg- ulating iGaming, such an approach will allow pioneering affiliates to stake their winning claim to the West. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Allan Petrilli is manager of affiliate services at Income Access. Dedicated to build- ing strong relationships in the iGaming industry and immersing himself in the world of affiliate marketing, Allan strives to be a trusted resource and leader for his team and within the indus- try at large. 17 How the West will be won