Rakeback vs Revenue share/CAP

[Ridge]

I've seen this topic come up a bazzilion times in the last few years. I know this will be a heated discussion but I thought it might be one worth talking about.

I often here affiliates that do not promote Rakeback say that they have had their players stolen from them by Rakeback affiliates. Now I understand that there are some affiliates who actively go after players knowing they already are under another affiliate and I believe that is wrong and should not be tolerated.

Having said that, most poker affiliates are poker players too and I wonder how many of us have rakeback account of out own at various poker rooms. I know personally I don't play at a site unless I'm getting Rakeback, with the exception of PS which has a VIP program that amounts to a nice RB deal.

So, what bothers me is that most "real" poker players become aware that they are not getting RB and could be, so they seek out someone who can give it to them. At the same time, they probably are a bit pissed they didn't get RB when they first signed up.

Now of course non-RB is a better deal in some ways for the affiliate. As a poker player though, it's not the best deal.

As an affiliate offering things to our players I think they expect that they are getting the best deal around, then they find out they didn't get the best deal for them. Aren't we as affiliates supposed to look out for the best interests of the player?? Isn't that how loyalty is established??

I hear it all the time "Rakeback steals players from me". In reality, if you offered your players the very best deal for THEM, they would never seek out anything else. Again, I want to add that I think "poaching" players actively is wrong and should not be tolerated by the poker rooms. Again the reality is that the Poker Rooms need to do everything they can to keep that player happy and loyal. If that means giving them Rakeback, so be it.

Overall, it seems to me that many affiliates aren't looking at the big picture and many are not looking out for the best interests of the players. Even if you don't agree with me, can you tell me that if you offered your players:

A) A 100% Bonus up to $1000
or
B) A 100% Bonus up to $1000 + 30% Rakeback

How many would take option A???

Also, I know that most players that sign up under most of us are fairly new to the game. So they may not know about Rakeback. Eventually they will find out, and do whatever they need to do to get their share of it.

Anyway, I know this post hasn't covered everything that could be discussed. I just think that some affiliates don't get why this happens and seem to want to ignore what seems to be an obvious issue.

Oh and yes I promote RB and Non- Rakeback rooms of all of my sites. So, I understand the issues here. All I'm saying is that you cannot fault legit affiliates or players from using the Rakeback system.

Ok, flame away

[mjmurphy53711]

In my opinion if you aren't doing rakeback you might as well go CPA.

Why?

Because any volume player that retains well (and thus ends up earning more than a CPA in the long haul) will become aware and "find a way" to get rakeback.

I guess some rb affiliates do target existing players accounts.....but for the most part I think it is the PLAYERS finding a way to get a new account with rakeback.

Affiliates need to face it, the days of collecting a lifetime of revenue off of a whale just clicking on your banner is overwith and not ever coming back.

[corpfan1]

Although I don't agree completely...I certainly think we are heading in this direction.

But...there are still sooo many players out there, who just want to play and really don't care about getting anything in return.

[mjmurphy53711]

Right, but all of "those" players are practically worthless as far as revenue share goes, and by the time they are "worthfull" they will find a way to switch to rakeback (or switch rooms to get rakeback).

[kaus]

Interesting topic. I choose CPA now and have been discussing with the rest of my AM's to move me over. I dont want to build a player base with rooms anymore, I want to collect my payments and thats it. I really like big CPA checks and for me to make that from Rev I am sure it would take a while to build enough players, active players at that to do so. I agree with you Ridge, they or many of them will move over. I dont think its anyone's fault really.

Why I havent done rakeback

I have a kick ass domain just sitting there but for me to have to go through all the stats and info on bonuses, fees, how much goes to players etc I just cant be bothered. At some point I plan on signing up with someone and go through them if they will do that end for me.

Also when I asked some rooms about it before they told me that if I switched over I could not offer both, my account would be rakeback so I said forget it.

As for affiliates who offer rakeback I dont blame them at all but I do think that those who still use the uninstall, clear cookies etc should be stopped like yesterday. Whether the affiliates is actively trying to get a player to open a secondary account or covering thier ass this method is so completely wrong. If its just to protect his/her own, than I am quite sure there are other avenues that could be taken to protect a rakeback affiliates players to that affiliate.

[PPP]

"In reality, if you offered your players the very best deal for THEM, they would never seek out anything else."

But that's just it. You are making a false argument. Suppose "A 100% Bonus up to $1000 + 30% Rakeback" is the best offer today. A month from now it might be possible to offer "A 500% Bonus up to $6000 + 50% Rakeback". The idea of offering the best deal today is basically a fools errand. There could be a better deal tomorrow. This is why poaching is such a terrible thing for both affiliates and cardrooms. It's even bad in the longrun for the snots who steal players. If players can be stolen, then their stolen players will be restolen in the future.

Rakeback continues to be a small part of this business for a lot of reasons, but the main one is it is bad for business. Only one large room offers it and they have messed up every aspect of them doing it. Additionally rakeback has no longterm future in the business as it goes the MGM/corporate route, even if that is a ways off.

The most important point that most people don't get is that most players don't have rakeback at the top of their priority list, and this is especially true of high volume good players and rank novices. They want to play poker. They go where the best games are. It's overgeneralizing but rakeback is a priority to middle level marginal players: rocks. These are the players who care less about the quality of games because their style earns about the same in all games.

Anyway, there are a lot of ways to promote online poker. Bonuses, player retention and crap like that aren't my business, and I don't want them to be since I can't stop cardrooms from doing idiotic things. Once the demand for lower rakes hits a critical mass, if it ever does, cardrooms will lower the rake or do strictly in house rakeback, which will be a great day for affiliates who generate players and a bad day for those who only steal players.

My view is both MGR and rakeback are doomed business models, although they both certainly have a lot of life in them, but again there are a lot of different ways to promote online poker. Focusing on the biggest rooms since they have no rakeback is one idea. Focusing on smaller ones with rakeback is another. Everybody gets to choose. The only thing invalid are the parasites who do nothing but steal (and you don't need rakeback to steal).

[kaus]

Originally Posted by kaus

At some point I plan on signing up with someone and go through them if they will do that end for me.

I have recieved some PM's with people offering me thier services. I am not looking for a rakeback provider but thank you anyways

[Ridge]

Originally Posted by kaus

I have recieved some PM's with people offering me thier services. I am not looking for a rakeback provider but thank you anyways

\

LOL!

[Ridge]

Well I'm glad to see some good responses. PPP, your right and I never said it was the only way to go, but I don't think that only "rocks" looks for Rakeback either. That is an over generalization, but I get your point.

Also, why is it doomed if online poker goes the MGM route? They would still have a comp program just as all casinos. You really think RB would be out of the realm of possibilities??

Anyway, we can argue about the issue of it being bad for business or not. Everyone sees more rooms offering it and players liking it. For older affiliates and it may seem like a crazy concept, but in reality it help player retention and keeps them coming back every month. As a new generation of players comes of age, they are also a bit smarter about how to make money playing.

Anyone who plays online poker knows that the games have gotten a bit tougher since the UIGEA passed and with the number of rooms for US players is limited, they can no longer "bonus whore" like they use to. So, they are looking for an extra edge.

So, if we are talking about straight gamblers then I agree they don't care about bonuses, rakeback, or much else. If we are talking about the average college age poker player then I disagree.

Picture this-

A players sign up at a Poker Room that offers RB, they deposit and play a couple of weeks and go broke.
They get their Rakeback payment notice in their email and they play again and win a MTT or make a good score along the way. Now maybe he goes broke and maybe he doesn't. If he does go broke, he's got some rakeback coming next month to try it all again. The cycle repeats itself.

If the same (average) player signs up at a non RB room and plays and goes broke, he moves on to the next poker room with a bonus.

Also, PPP I'm sure you are going to tear me up especially on the "average" player example (probably everything else too) , but I'm honestly too tired tonight to drag up stats on you right now.

One last thing, I bring all this up because it's my opinion and not because I think its the gospel truth. It is how I see it, but I am willing to hear everyone's opinion about this issue. I know many of you have been in those business a lot longer than me. So in the interest of helping everyone learn something, please post reasoning behind your responses.

[PPP]

"Also, why is it doomed if online poker goes the MGM route? They would still have a comp program just as all casinos. You really think RB would be out of the realm of possibilities??"

I think they'll be happy to deal with good affiliates. I think they'll offer generous comp programs, which could be rakeback but not the silly flat rate way which makes no sense compared to just lowering the rake. They might do stepped deals where liveones get more back.

What they won't do though is let third parties handle the distrubution of funds. They have no interest in some player getting ripped off and have them pounding on the glass of a casino cashier screaming "where is my rakeback?!" I'd expect they legally couldn't do it either, but just from a reputation and hassle perspective there is no way I can imagine they would let independents handle the money, or get a literal piece of the action.

There will be plenty of options with the b&m's, but the idea of some outfit that is directly affiliated with them passing out bucks via Paypal or whatever has a zero likeliness.