The REAL commission

[Azureus]

This is not exactly unethical but more like not telling the whole truth.

I think many of you have experienced this - a program promises an attractive percentage of revenue share (like 35 %) but you end up getting a fraction of what player deposits (more like 22 % or less).

This is something you can't read directly from the terms&conditions because they are often very vague. And it's also unfair to some programs - basically the more you hide in your T&C, the better your program will look (at first sight) to the potential affiliates.

Here's some experience I have. I'll be happy if you post your own experiences, and I'll also be happy if some affiliate managers comment on this.

__________________________________________________ ____

AFFILIATE LOUNGE
They promise 30-50 % (depending on their net revenue from your players) and no negative carryover, I have 30 %. However, in reality it is 30 % from 72 % (0.3*0.72=21.6 %). When I asked them, they were not able to explain where did the remaining 28 % went...

BET365 AFFILIATES
They promise 30 % and have negative carryover. However, you can't tell the real percentage from their very limited statistics.

IAFFILIATES.COM
They offer individual revenue share and have negative carryover. But again, you can't tell much from their limited statistics.

SPORTINGBET AFFILIATES
They promise 25 % and no negative carryover. Now, this is very complicated.
a) they charge a 9,5 % processing fee for each deposit (I mean WTF?)
b) they use the worst currency conversion possible (when you don't deposit in EUR)
c) it seems like it is 25 % from 84 % of the deposit after deducted fees
So the real comission is more like 0.905*0.97*0.84*0.25=18,43 %)
They were not able to explain much, the AM just repeated the formula they have in terms&conditions.

WAGERSHARE
They promise 25 % and no negative carryover. I'm not really sure about this one. They don't seem to deduct any administrative fees so the percentage probably really is 25 %.

But the statistics still confuse me, e.g. one my player in stats made a deposit (only a single one deposit) of 120 EUR and their net revenue from this player is 540 EUR - I got 135 EUR which is more than the player actually deposited. Now who is being ripped off?

SPINWINPARTNERS
They promise 35 % and no negative carryover. However, you don't know how much the player actually deposited so you have no idea what their net revenue really means.

VIRGINGAMES.COM
They promise 35 % and no negative carryover. They have a deduction which is approximately 7 % of the deposit. They deduct this no matter if the player is losing or winning which is something I don't really understand. But they make everything clear in their statistics. The percentage is definitely less than 35 %, from what I can tell it could be around 32,5 %.

What is your take on this? What would you (not) recommend?

[universal4]

Stop comparing the percentages to the deposit and use the formula of netwin....

If a program says they are paying 25% of netwin, they didn't say they paid 25% of deposits.

Or you can look at Slotland, they pay a percentage of deposits.

I agree that it would be nice that some of the programs you mentioned would show us more detailed stats concerning the actual deposits, bonuses etc....but not all programs do.

Rick
Universal4

[Azureus]

Stop comparing the percentages to the deposit and use the formula of netwin....

I know I shouldn't do that but IMO most new affiliate do EXACTLY this when they decide what program to promote. You just look at the percents, negative carryover policy and maybe some references/experience from others.

After the first month, you suddently realize that the program that seemed to be the best is not so good after all.

And it's also quite unfair to those programs that are fair and clear about everything... So, any other ideas?

[F-L-C]

I have no idea why new affiliates would look at deposits though? As this is not a common business model... wouldn't most new affiliates read the terms 'how commissions are calculated' ? I never looked at deposits over losses, some programs don't even disclose deposits. I would promote who you trust and who makes you the most money!

[lots0]

When I look at the stats the first things I look at are (and I am perdy sure I am not alone in this) ;
1. Clicks.
2. Sign Ups.
2. New Depositors.
3. Deposit amounts.

After I look at these things, then I look at things like Revenue/Earnings, conversion %'s.

As an affiliate I am very concerned about how much money (in deposits) I am generating.
The amount of deposits generated directly effects the amount of earnings I as an affiliate will generate for myself.

I don't know how anyone could trust a program that does not disclose all information about deposits.

[universal4]

most new affiliate do EXACTLY this when they decide what program to promote.

In my opinion, most new affiliates in this industry learn pretty quickly that their commissions are derived from PROFITS to the casinos, not how much is deposited. (there is often a correlation between the two but lots of deposits does not always translate to higher profits)

You are correct, affiliates look at the percents, NCO and the general feeling of how others are doing.

At no point while looking at the percentage of commissions a program is going to pay are refernces made to the percentage being applied to deposits but to netwin so why do you think you should apply it to deposits?

Rick
Universal4

[iGamingWriter]

Looking only at deposits is kind of like working in a shop and looking only at the cash that's handed over and not considering the change given.....

[mojo]

When I look at the stats the first things I look at are (and I am perdy sure I am not alone in this) ;
1. Clicks.
2. Sign Ups.
2. New Depositors.
3. Deposit amounts.

After I look at these things, then I look at things like Revenue/Earnings, conversion %'s.

As an affiliate I am very concerned about how much money (in deposits) I am generating.
The amount of deposits generated directly effects the amount of earnings I as an affiliate will generate for myself.

I don't know how anyone could trust a program that does not disclose all information about deposits.

I agree. Who wouldn't look at deposits? Add: New or Old affiliate. I am not sure why I am seeing that deposits are not a factor unless I am reading this wrong. Along with withdrawals. It should give you a pretty good idea, no?

Yes, there are coupons and progressive contributions, etc. But you should have a general feel for what you should earn from deposits and withdrawals . It's a little scary that it is not factored in here. Again, unless I am reading wrong.

[universal4]

But the commissions are NOT based on deposits.

If a player plays every day winning some days and losing others, but he always withdraws on his winning days and deposits say $1000 in a months time but the netwin is only $200 why should the commission be based on the $1000 and not the $200.

Yes deposits are a factor in DETERMINING the netwin, but not the commission.

The OP claims the programs are not telling the truth about the calculation of commissions and in my opinion that is incorrect.

As an example, if you look at http://www.affiliatelounge.com/betsson-rates/ you can see they very clearly define what "net revenue" is and how it is calculated.

At no time do they state you get 25% of deposits, so to make up some formula of what the commission is based upon the deposits and then saying the program didn't tell the truth about it is not fair to any of the programs....

There are plenty of programs that have problems and issues we should be pushing them to fix, but we shouldn't be accusing them of not being honest about how they calculate the commissions based upon deposits....when they didn't.

Rick
Universal4

[JackTenSuited]

If it was based solely on deposits it would be open to a world of abuse, not to mention many people, especially in the UK deposit and withdraw frequently due to no fees associated with doing so as such their deposit amount will be high but with a low net profit.
Exactly why anyone would base commission based on deposits is beyond me :s

[mojo]

Yes deposits are a factor in DETERMINING the netwin, but not the commission.

I understand netwin. I don't think anyone is saying that its ONLY deposits they are looking at. Which is where I am disconnecting in this thread. I sounds like deposits are a non-factor, but again, I think I am misunderstanding.

If I have 10k in deposits I expect to see the withdrawals, remaining balance, coupons and bonuses and whatever. But I am starting with the deposits. That's the basis of netwin and everthing else. It's your livlihood and what we've worked so hard for.

There was one program who took administrative fees right off the top. So the commission they claimed on their website was false. Sometimes netwin can be abused as well. Another program charged incorrectly for bonus deductions. It happens and I think it needs to be thoroughly explained by the program.

[universal4]

Mojo,

The OP is saying that programs are not telling the truth about the quoted commissions and he gave figures to back that up.

BUT his logic is WRONG (in my opinion).

His figures take the commission on net win and then he compares what the percentage of deposits are and states that is the commission from the program is less than advertised...

a program promises an attractive percentage of revenue share (like 35 %) but you end up getting a fraction of what player deposits (more like 22 % or less)

I never once stated we shouldn't consider deposits, bonuses, coupons, etc....as all of those are factors that get us to the netwin figure....

I am stating that if a program states they pay xx% of netwin and they do so, it is wrong for us to say they are lying about the commissions because the xx% of deposts do not match the xx% of netwin.

Rick
Universal4

[slotplayer]

I understand netwin. I don't think anyone is saying that its ONLY deposits they are looking at. Which is where I am disconnecting in this thread. I sounds like deposits are a non-factor, but again, I think I am misunderstanding.

If I have 10k in deposits I expect to see the withdrawals, remaining balance, coupons and bonuses and whatever. But I am starting with the deposits. That's the basis of netwin and everthing else. It's your livlihood and what we've worked so hard for.

There was one program who took administrative fees right off the top. So the commission they claimed on their website was false. Sometimes netwin can be abused as well. Another program charged incorrectly for bonus deductions. It happens and I think it needs to be thoroughly explained by the program.

technically, deposits are factored in but only in the sense of casino gross income. Similar to my retail site which is called monthly gross sales.
From gross income, overhead is deducted like withdrawals, bonuses, fees, chargebacks, etc.. This becomes the net win or net profit, from that figure affiliate commissions are caculated.

I do this formula with my retail sites monthly to see what my actual profit is.

Affiliates really need to look at the deductions, but if they advertise 35% you are getting 35% but like Rick said its not gross deposits, its gross deposits less deductions.

[F-L-C]

hallelujah logic prevails! I am not having a go at the OP but I also want to dispel the myth that new affiliates look at rev share in terms of deposits. If anything NEW affiliates would read 'how commissions are calculated' as they are new to the game and would not make assumptions

[Azureus]

Thanks for all the answers.

I completely agree with Rick that you shouldn't base revenue on deposits only. What I was trying to say was that net revenue calculation may be VERY different in different programs. This is what I was trying to explain - some programs pretend to be more attractive than they are (e.g. Sportingbet) while some fair and very clear about everything (e.g. Virgingames).

All the calculations I posted were based on players who DID NOT withdraw (AFAIK). So you cannot explain the differences by withdrawals.

Example:

Two players both deposit 100$ (on different gaming sites), both bet 100$ that Italy will win the EURO 2012. Actually, Spain wins and both lose. Two programs offered you 35% share - in one program you get 18$ in the other you get 32,5$.

I don't understand how can my logic be bad - this is just NOT TELLING THE WHOLE TRUTH by some programs - which is unfair to both affiliates and other programs!

If you don't believe me, try it - there really IS a difference.

Another important point why you should care (in the long run) about the ratio between deposits and net revenue is that it objectively tells you how much you really get and how much the program values you. In some programs you DON'T SEE THE WITHDRAWALS. So in what other way are you supposed to check how well the program performs?

Sure, you should also check player retention, how the program handles players etc. --- but it really helps a lot when you have access to a complete overview of the player (that is: deposits, withdrawals, net revenue, commission).

If I have 10k in deposits I expect to see the withdrawals, remaining balance, coupons and bonuses and whatever. But I am starting with the deposits. That's the basis of netwin and everthing else. It's your livlihood and what we've worked so hard for.

This is what I was trying to say, maybe I wasn't clear enough.

There was one program who took administrative fees right off the top. So the commission they claimed on their website was false. Sometimes netwin can be abused as well. Another program charged incorrectly for bonus deductions. It happens and I think it needs to be thoroughly explained by the program.

This is so true - and unfair for the programs that are clear about everything. Some programs have "certain" administrative fees and bonus deduction and you have no idea WHAT EXACTLY THEY MEAN. When you ask them, the affiliate manager just repeats their net revenue calculation formula...

but if they advertise 35% you are getting 35% but like Rick said its not gross deposits, its gross deposits less deductions.

Another great point. You must look at the deductions - but you usually get the idea of real deduction only the first month or two AFTER you start promoting a program!

If you accept that this is normal, you are just getting ripped off. It's a shame that the better known brands often treat affiliates worse than the smaller ones...

[F-L-C]

It's a shame that the better known brands often treat affiliates worse than the smaller ones...

This is because the bigger brands are not dependent on affiliates, they have huge advertising budgets. Its the smaller rooms that need them.

[universal4]

Don't forget that the odds will affect this, as well as bonus, comps etc etc...

To continue to sit back and say the programs are lying about the commission is the lie.

Yes each program can set the way that netwin is presented and figured, and discussions similar to this helps all affiliates see the differences and can also reveal which programs may actually pay a little better, but to claim they are NOT paying commissions as posted accurately does not fairly represent the programs.

Rick
Universal4