GGR Deductions Seem Excessive

Discussion in 'Affiliate Republik' started by AussieDave, Jun 6, 2015.

  1.  
    AussieDave

    AussieDave 17 years & still going!

    Messages:
    2,951
    Likes Received:
    1,485
    Joined:
    Nov 28, 2013
    Never did well with Tropezia but they offered a good assortment of embedded games so kept them on site. When Slots Million opened, did a change over. Now I've finally got a depositor.

    NB - AUD player (hence € with cent values)

    Aside from deposit bonus money, the other deductions of Software Costs - Licensing Costs - Transactional/Payment Costs add up to 56.28€.

    These addition fees seems extremely excessive on a mere 175.90€ deposit. The final NR (net gaming revenue) - 119.62€

    What is the exact and true fee associated to each of the following individual deductions (please):
    • Software Costs?
    • Licensing Costs?
    • Transactional/Payment Costs?
    And do these increase in relation and relative to the amount deposited?
     
  2. admin Notification Admin Staff Member

    A reminder is sent to all affiliate managers.
  3.  
    lucky

    lucky Affiliate Program Representative

    Messages:
    28
    Likes Received:
    5
    Joined:
    Feb 28, 2013
    Hi Bet4You!
    Sorry for delayed reply, I just saw this post. Very happy to go into the details with you. These are not strange numbers for a first deposit player. The first deposit offer is usually the most aggressive one, i.e. 100% or more on first deposit and therefore carries a large bonus cost as compared to repeated deposits and regular ongoing activity in a casino.

    In your example, the deduction is $56, which is 32% deduction from GGR - I can tell you that this is excellent and nothing if you compare the deduction fees from other affiliate programs on the first deposit which includes the heavy welcome bonus costs. I wish affiliates would compare these deductions for all programs because I can tell you, we would on the top as lowest deductions or at least very close to the top.

    Companies usually have a deduction on the first deposit between 30 and 60%, it really depends on the brand. Some brands invest into media and brand building in a market and therefore have higher deductions. Some brands are small and do not have great deals with the providers and therefore have higher costs. So, the deductions vary from brand to brand. Some brands have invisible deductions that are magic, we (people working within the igaming industry) refer to them as "shaving" :)
     
    Last edited: Jun 10, 2015
  4.  
    Jason May

    Jason May Member

    Messages:
    34
    Likes Received:
    13
    Joined:
    Dec 1, 2014
    Let me see if I get this straight:
    1. You don't answer his question.
    2. You deduct a flat 32% without any mention of it, i.e. invisible in the T&C.
    3. You go on to claim that "Some brands have invisible deductions that are magic, we refer to them as "shaving".

    So you refer to your own deductions as "shaving"?
     
    AussieDave likes this.
  5.  
    AussieDave

    AussieDave 17 years & still going!

    Messages:
    2,951
    Likes Received:
    1,485
    Joined:
    Nov 28, 2013
    I highly doubt you'd say anything to the contray.
    Irraspective of the puffery the fact remains this 32% hidden deduction, is exactly that, invisable (aka in your words "magic"). Factor in the newly actioned NCO and that really throws a cat amoung the pigeons, hey :D

    If it walks and quacks like a duck... just sayin!

    EDIT: Oh well guess it's time to kick yet another AGD certified program to the curb.
     
    Last edited: Jun 10, 2015
  6.  
    lucky

    lucky Affiliate Program Representative

    Messages:
    28
    Likes Received:
    5
    Joined:
    Feb 28, 2013
    Hi Jason, thank you for joining. I am very happy to elaborate on each point and carry on this conversation. I updated my answer above to clarify that with "we" I meant people who work within the igaming industry.

    1. Sorry, I am not able to disclose the exact fees but I can share some current numbers for our industry that are true and will help answer this question. First of all, I do not believe that any casino would disclose their cost with the supplier, I do not think that even the stock listed companies share this information in enough detail.
    Some of the fees are related to the size of the deposit, like the transactional fees that we pay as percentages of the transfer. For example, let's say that Visa charges us 5% on each transaction. On other hand, other fees are not based on the deposit size but on revenue generated (which is bets - wins). For example, lets say that Microgaming charges us 20% on revenue generated with their games.

    A. Software costs depend on several variables and can range anywhere from 5% to 25%.
    One of the things that affect this cost the most are the type of games; here we are talking about table games like black jack and roulette, classic slots like fruit/bells style games and regular modern slots, or branded slots (like Universal or Marvel). Branded slots are very very expensive and can even be double the price of other games.
    Another thing is the size of your business, the more turnover you have, the better price you get. Then there are special deals depending if you are using multiple services from the same provider, like Sports or Bingo, or simply their casino platform.

    B. Licensing costs are different from jurisdiction to jurisdiction and I am really not a pro here. There is a set up fee, yearly fee, monthly fee depends on your turnover and then there are yearly audits as well.

    C. Transaction costs can range anything from 1% to 10% mostly depending on the processing volumes of the business and can be broken down by which method the player is using and which country the player is from. You can assume that the costs are lower the larger the brand/operation. So the big dogs should have the lowest fees by far, the middle guys should have 3 to 5% and the new kids on the block perhaps even higher.

    2. We do not deduct a flat fee, the 32% was derived from the specific example that Bet4You provided. In our T&Cs we clearly state how we derive to Net Revenue from Gross Gaming Revenue under section 6.

    3. Over the years many affiliates have publicly shared their experiences where some programs have not correctly tracked their revenues. At some point, somebody started calling this "shaving" as the revenues were slightly adjusted in favour of the affiliate program. As in; the revenue totals were shaved a bit before inserted into the affiliate program statistics. We at Affiliate Republik actually use a real-time platform that records clicks, registrations, deposits, and amounts of deposits in real time - I believe that this is the best and most transparent way to present the statistics so that our partners can have continued trust in us. As a matter of fact, another affiliate community within our igaming industry does random tests on our platform and confirms the authenticity of it.

    Cheers!!
     
  7.  
    lucky

    lucky Affiliate Program Representative

    Messages:
    28
    Likes Received:
    5
    Joined:
    Feb 28, 2013

    Is there a Which hunt going on that I am not aware of :)
    I just replied in more detail, maybe that will help answer your questions in more detail.

    Remember, the affiliate programs that pay on Net Revenue (pretty much every single one) have a deduction from the Gross Gaming Revenue - there is nothing hidden about this. Happy to answer further questions.
     
  8.  
    slotplayer

    slotplayer Affiliate Guard Dog Member

    Messages:
    1,757
    Likes Received:
    274
    Joined:
    Aug 8, 2008
    "For example, lets say that Microgaming charges us 20% on revenue generated with their games."

    that explains why casinos go through such lengths to mitigate withdrawals.
     
  9.  
    Jason May

    Jason May Member

    Messages:
    34
    Likes Received:
    13
    Joined:
    Dec 1, 2014
    Well I cant speak for Aussie Dave. But for me there is a Which Hunt going on. I must admit I bit my tongue. You see, when I found out Tropezia's entire ABOUT PAGE was fake, and every person on the page was a case of stolen identity, I got offended. I felt duped because I was referring players to your casino and I realized I was part of the lie.

    Then you create NCO. That fired me up.

    Now with your most recent post I cant take it anymore. I guess its the 3 strikes and your out rule.

    But back to your rebuttal, when you say "we" keep in mind we know who you are but you have no idea who "we" are. So don't assume an information advantage. You go on to mention all of the different direct costs and I agree with you completely that the supplier cost should be held confidential because its tied to a NDA.

    But I think you should provide a range like CasinoCruise did, I gained alot of respect for Lord Apter when he did that. It seems most programs now adays like MrGreen and Guts deduct a flat fee say 18%. And the 18% approximates all the direct costs. By doing this there will always be a clean audit trail and you don't have to worry about violating NDAs.

    Like seriously are you paying us a GGR x a fixed fee? Or does your back office really deduct all the the exact direct costs to the last penny e.g. for each transaction cost?
     
    AussieDave and CaseyM like this.
  10.  
    slotplayer

    slotplayer Affiliate Guard Dog Member

    Messages:
    1,757
    Likes Received:
    274
    Joined:
    Aug 8, 2008
    I might add, the overhead might be getting too high to for programs to sustain an affiliate program. If not today, at some point down the road. I have the retail sites, I'm always monitoring my overhead costs.
     
  11.  
    AussieDave

    AussieDave 17 years & still going!

    Messages:
    2,951
    Likes Received:
    1,485
    Joined:
    Nov 28, 2013
    Lets just look at this for a moment.

    As an Affiliate Republik partner I receive 25% on player losses.

    So shouldn't I only be charged 25% of these hidden deductions? With SlotsMillion Casino/Affiliate Republik wearing the remaining 75%.

    In any other business, if I were to hold a 25% stake, then I'd pay a 1/4 (25%) of the operational costs and would also received a 1/4 (25%) of the business profits. I certainly wouldn't be paying 100% of operational costs only to receive 25% of the profits o_O
     
  12.  
    AussieDave

    AussieDave 17 years & still going!

    Messages:
    2,951
    Likes Received:
    1,485
    Joined:
    Nov 28, 2013
    Thanks for the heads up on this, I wasn't aware of it. Like yourself I used this page as gospel, commenting in my review of Tropezia that a casino which displays their personnel photos etc, is very transparent. Now I feel like I've been played for a sucker and have also been party to this load of lies and BS too. That makes me feel extremely upset.

    AFAIK wasn't the NCO retrocactively applied?

    I asked this simple question in my OP, yet you keep side-stepping it lucky.

    Not that I'm aware of.

    However when a program is busted BS'ing &/or the casino(s) they represent is busted BS'ing, I tend to start wonder what other untruths and fabrications have been played upon affiliates and players alike. How hard is to be transparent? It's only as hard as one chooses to make it.

    Granted "lucky" you've come out and disclosed the hidden fees % but that's not point. What is, is your program chose to hide these figures, when as a partner, I had every right to know what I was getting into and what deductions were being taken from GGR. It's like the hyperbole of 60% revenue for life which some programs tote. It's total BS!

    A blurb follows which gives the impression of trust and fairness.
    Well, IMHO there is nothing even remotely fair or trusting in the above... just sayin!
     
    Last edited: Jun 11, 2015
  13.  
    lucky

    lucky Affiliate Program Representative

    Messages:
    28
    Likes Received:
    5
    Joined:
    Feb 28, 2013
    Good morning Bet4You,

    1. Like many programs in our industry, we offer commission based on a revenue share, therefore the costs of "sales" is deducted form the gross and we have the net revenue. You are not covering any part of the operational costs at all because they are paid from the net revenue we have left after we pay your commission. So, in our case you are paying 0% towards the operational costs.

    There is nothing hidden here. It appears that you are not fully aware of the dynamics behind the online casino costs - which is not easy! Trust me, it took me a while to understand. Let me give you the simplest example; when a customer signs up and looses his deposit of 100€ he generates less cost than when a customer signs up and takes the welcome bonus. When the customer takes the welcome bonus, he gets 200€ to play with. We pay the game royalties based on the bet-win; the game providers do not care that half of the revenue comes from the money we gave to the player as a bonus. So, if the game royalty cost is lets say on average 18% as referred in this thread, it would be 18€ on a 100€ clean deposit. This means that the cost would be 36€ when the player looses 200€. This in turn translates to 36% cost on the 100€ deposited.

    We are in the igaming industry, I know that trust is not common in our circles. I simply encourage you to take $€10 and loose it across 15 of your favourite casinos - you have to so it on a clean affiliate account or a new source/tag if you can see the commission per source/tag.
    I can tell you, you will be surprised when you start comparing the deductions. This is what all large and serious affiliates do in order to know which program is more profitable for them.

    We work on real cost (not a fixed cost) and we also offer no negative carry over, plus we pay lifetime commission for as long as the player is active - a very nice combination and a great deal.

    2. Tropezia Affilaites applied a negative carryover for future revenues, not retroactively (to my best knowledge). While Tropezia was under Affilaite Republik, we offered no negative carryover. It is only after they migrated the accounts that they activated the negative carryover.

    I am not sure why you seem to be so pissed off, I definitely know that it is not because of me or our program. If you had any questions and if you wanted to find out your deductions for this player, you could have just emailed me, skyped me or called me. This is a public forum, there is only so much details I can reveal.

    And yes, I can introduce you to an affiliate who did a mailer and forgot to put in the tracking link before he sent it out. Panic and disaster. Then our team spent the next 4 weeks identifying every single registration we had in the casino to locate 96 depositors that came from this mailer. So yes, I think that I can proudly say that we can be trusted.

    I personally think that it is a bit funny that you say we have hidden fees. Hidden fees are when you do not see the deposit amount in your affiliate account. Our fees are not hidden, you can always find out by deducting the net revenue from gross revenue.

    I love talking about all of this because it shows how transparent we really are as compared to some programs. If you tried chasing some affiliate managers, they will never reply to you close to this. And I am not talking abut Lord Apter.

    And, are you SURE you are taking about the right program, because I KNOW that your commission with us is not 25%.
     
    Guard Dog and millm like this.

Share This Page