Effective Online Customer Acquisition Strategies Through
Competitive Intelligence

Can online casinos be scientific about online customer acquisition to improve ROI?  This article argues that, using competitive intelligence, you can map out strategies to improve your affiliate marketing program and find affiliates that will work for your site.
      In July of 1996, amazon pioneered affiliate marketing through the creation of their “associate network”. Their approach assembled an army of affiliates who may each refer only a small number of customers, but collectively produce a strong result. Affiliate marketing is one of the most successful means of online customer acquisition in the gaming industry as well. Richard Segal, CEO of PartyGaming, said at the European iGaming conference  in Nice in October that PartyGaming attracts 30% of its new customers through affiliate marketing.

      Online gambling lends itself to the affiliate marketing model, due to the restrictions on paid-for-search marketing as well as the nature of the game. In today’s competitive online world, Poker Players may need to be tempted to your site rather that actively seeking you out.
      Online casinos can leverage competitive intelligence to find affiliates likely to be successful by learning from successful competitor practices. First I’ll introduce the approach of finding out what’s working for your competitors and then I’£ cover ways to use audience profiling to find more of the customers you want.

What works for your competitors might work for you

By identifying which sites are working for your competitors, you can use affiliate marketing to catch up with those competitors. My experience is that most online casinos use trial and error to find affiliates that work. The advantage of competitive intelligence is you can learn from what’s working for your competitors.
      Let’s take the example of 32 Red. 32 Red received 1.13% of visits within the Hitwise Gambling – Casinos category in November 2005. The site held a strong ranking of 16 among the 190 domains tracked that month. However 888.com, the # 1 ranked casino in November, received over one quarter of all visits to casinos in November, with more than twenty-three times the share of visits than 32 Red. Could close the gap in market share between itself and 888.com by either approaching the affiliates with which 888.com works or finding similar sites with which to partner.

      In the twelve weeks ending 3rd December 2005, there were 488 websites visits to 888.com that did not send visits to 32 Red. There were 12 sites that overlapped, sending visits to both 32 Red but not to 888.com.1
      Among the 486 opportunities lie many potentially lucrative affiliate partnerships for 32 Red. 32 Red receives 59% of its visits from websites in the Gambling category, indicating that it is highly dependent on competitive traffic (visits from competitor sites), visits from competitor sites), visits from sites in its parent network and visits from gambling directories. Nearly half, 49%, of visits to 32 Red come from its sister site, 32 Red Poker. After visits from Gambling websites, search engines account for the next largest share of visits, accounting for 12% of visits.

We have no doubt all seen the 888.com stretch Hummer at conferences and have seen the 88.8% commission offers that 888.com promotes at trade conferences. This aggressive affiliate marketing strategy seems to have yielded results. 888.com’s traffic sources are highly varied with 80% of visits coming from sources other than search engines and competitive gambling sites. 15% of visits to 888.com come from search  engines, 7% from sports sites and 5% from chat rooms. A relatively low percentage (5%) of visits comes from other gambling sites.

Percentage of upstream UK visits to 888.com and 32 Red visits in November

A quick scan of the differences in visits to 888.com and 32 Red, reveal that there are potential opportunities for 32 Red to attract visits from sports, news and media, dating and automotive websites. For this example, we’£ look further at the Hitwise Sports category.
      I mentioned earlier in this article that 888.com receives a 23 times larger share of visits compared with 32 Red. Because of the vast difference in the size of these sites, looking downstream from sports sites to each provides a view to the difference in volume. In November, 0.06% of visits from sports sites went to 888.com. While this figure is low, it represents 7% of upstream visits to 888.com and is 70 times larger than the volume that went to 32 Red. The top two subcategories of sports sites sending visits to 888.com were Football and Fantasy, neither of which sent visits to 32 Red.

Weekly Downstream UK Visits from Sports to 888.com and 32 Red.

Among the top football sites visited before 888.com were Teamtalk.com, Chelsea Football Club, Liverpoolfc.tv. and Manchester United. Among the top sports – fantasy sites visited before 888.com were The Sun premiership Dream Team. MATCH megastars Fantasy League, and Hat trick. Hitwise captures the natural flow of traffic on the internet, so while these sites may not all have commercial relationships with 888.com, they were all visited before 888.com in November.
      We could repeat this analysis for other industries sending a large number of visits to 888.com or any of 32 Red’s other competitors to identify potential industries or sites   that are already successful for 32 Red’s competitors.

Finding More of the Customers you want

Gambling websites, including casinos, have been very aggressive about building up affiliate networks and these networks have been a critical driver of traffic to gambling sites. However, to break into a mainstream audience, casinos may want to look beyond what’s working for competitors.
      Finding affiliates that will draw the audience you want to your site can be approached in two ways : find more customers like those that are most profitable for you now and find customers to fill gaps relative to competitors.

  1. Find more of what works for you now

Finding more players like the ones that are your most profitable requires looking at your own customer database understand characteristics of those most valued customers. For example, if you know that your most profitable customers also bet on horse racing, you may want to approach horse racing sites for affiliate partnerships. If you know that   your most profitable customers are between the ages of 18 and 25, work in blue collar jobs, and play football with mates at the weekend, you might want to establish affiliate partnerships. If you know that your most profitable customers are between the ages of 18 and 25, work in blue collar jobs, and play football with mates at the weekend, you might want to establish affiliate partnerships with sites for local football clubs.

      A more sophisticated way to do this is to create a Mosaic profile of your customer database and to analyze this to find profitable segments. Mosaic profiles are maintained by Experience and create a rich segmentation based on behavioural profiling of UK residents by post code. The profile take into account basic demographics such as age, gender, and social grade, as well as creating a rich profile based on interests, media consumption, recreational pursuits & c. Hitwise has partnered with experience to offer a Mosaic profile of visits to websites.

      The first step to create mosaic profile of your customer base. You can do this using postcode information from credit card billing addresses. You will then need to identify your most profitable or desirable customers.   A clustering analysis will reveal any Mosaic   Groups or Types that are particularly successful for your business. You can then use this analysis to find websites that attract the desired profile of visitor so that your offer is going in front of potential players that are likely to be profitable to your business.

  1. Fill gaps relative to competitors

  The other approach is to look at the demographic and lifestyle makeup of visitors to your site compared to competitors and to identify   gaps that you might fill. Understanding the audience your competitor’s site attracts, and how that is different from your own, will identify potential lifestyle segments that are prone to visit casino sites but who aren’t visiting your site.

      Let’s take Blackjack Ballroom for example. While Online Casinos attract more visits from the Urban Intelligence segments compared with the internet average. Blacjak Ballroom receives a 59% smaller share of visits from this segments compared with average for online casinos. According to Experian, the Urban Intelligence segment is “young, single and mostly well-educated, these people are cosmopolitan in tastes and liberal in attitudes. ”
      Blackjack Ballroom could find potential affiliate partners to fill this gap by partnering with websites that attract a large percentage of volume of visits from the Urban Intelligence segment.

The News & Media – Print category attracts a high volume and high percentage of visits from the Urban Intelligence segment. The Sports – Cricket category attracts a low volume of visits but with a high concentr4ation from the select segment.
      While many of the News & Media – Print websites that attract the largest concentration of visits from the Urban Intelligence segments may not be open to taking advertising from online casinos, such as the New York Times and the Guardian Unlimited, others offer ripe opportunities. For example, 14% of visits to The Times, 23% of visits to This is London, 24% of visits to Radio Times and 12% of visits to The Telegraph are from the Urban Intelligence segment.
      Cricinfo is consistently the # 1ranked Sports –Cricket site based on share of visits, and in the four weeks ending 26 November  2005 attracted 20% of its visits from the Urban Intelligence segment. The site sent 3.5% of its visits to Gambling websites in November.

Concluding Thoughts

Affiliate marketing by trial and error can be wasteful. Though competitive intelligence you can find out what is working for competitors and find out what is working for competitors and find out where the customers you want on your site spend their time online. This will allow you to put your message in front of the right customer.


HEATHER HOPKINS is Director of Research for Hitwise UK. Hitwise is the leading competitive intelligence service and helps its clients acquire more customers online and to benchmark website performance against competitors.
      As Director of Research Heather analyses the trends affecting businesses online and works with Hitwise clients to identify   opportunities and threats to online business growth. Heather publishes regular research reports on the search, gambling, travel, and retail sectors providing insights to help Hitwise clients improve search marketing and affiliate programs. She is a regular speaker at industry conferences, including European iGaming congress and Expo 2005 and The Poker Summit 2005 and is quoted regularly in trade publications and the nationals including the Financial Times and the Telegraph.

Prior to joining Hitwise, Heather was a Vice President with Dalbar, a market research firm in Boston, Massachusetts and Toronto, Ontario. For the purpose of this analysis I considered a maximum of 500 upstream and downstream sites.