In-House Affiliate Programme vs Affiliate Network: Cost, Data and Control

The invoice from an affiliate network is one of the tidiest documents an operator's finance team sees all month. There is a line for the brand, a count of players who qualified, a CPA rate and a total at the bottom, and it gets paid without much fuss. It is tidy on account of everything that would make it untidy staying with the network, which websites sent those players, who owns the websites, what each of them was paid out of your money and what the ads said on the way, and on most network deals none of that was ever going to be on the page.

That is most of the trade, truth be told. Whether to run an in-house affiliate programme or buy players through a network gets argued as a question about cost, and cost matters. What decides it more often is how much of that missing detail you want on your own desk, and how much work you are willing to take on to get it there. We should say plainly that we are not neutral here. Over here at MAP we build the software operators use to run programmes of their own, so we have an interest in which way you go. Plenty of operators are better off with a network for a while, mind you, and it would be odd to pretend otherwise.

A network has already done the slow part. Its team has spent years signing affiliates, checking them, agreeing terms and paying them, and when you join as one of its brands you get access to all of that more or less at once. If it has a few hundred affiliates already writing about casinos in a market you are about to enter, players can be coming through in the first week or two. An in-house programme starting from nothing in the same market might take a quarter to find its first dozen active partners, and most of those will send a trickle to begin with.

Then there is the paperwork, which is a good part of what you are paying for. You sign one contract instead of several hundred. One invoice comes in each month and one payment goes out, in one currency, to one company, and the network deals with paying its affiliates in whichever countries they happen to live in, with whatever thresholds and tax forms and e-wallets that involves. Anybody who has run payouts for a big programme knows how much of a month that can swallow, and our piece on affiliate payouts goes through the lot of it.

Networks recruit, too, and recruiting is the part in-house teams most often underestimate. Finding affiliates who are any good, persuading them to promote a brand they have never heard of and keeping them interested once the launch deal wears off is a full job for somebody. For an operator testing a new market with no contacts in it and nobody to send there, renting that reach for a few months is a perfectly sensible thing to go and do.

The detail that stays with the network is the detail you would make decisions with. A count of qualified players tells you how many came. It does not tell you which of the network's affiliates sent the good ones, the players still depositing six months later, and which sent players who cleared the CPA baseline and never came back. On a direct programme you would pay those two affiliates differently, or keep one and let the other go. Through a network both of them reach you as one average at one rate, and from your side there is no way of telling them apart.

Some networks pass a publisher ID back with each player, which helps a little. It is the network's own number for the affiliate, so you can see that publisher 4471 sends better players than publisher 2208 and that is roughly where it stops. You cannot ring 4471. You cannot offer them a better deal, and you have no way of looking at the site they run unless the network tells you which one it is.

How the network is paid feeds into this as well. A lot of network deals in iGaming are CPA, and a network paid per qualified player is paid to deliver qualified players, which is not quite the same thing as players worth having over a year. That gap has a piece of its own, on FTD value against lifetime value, and the rules deciding whether a player counts at all are in our explainer on CPA qualification criteria. Nobody at the network is doing anything wrong by chasing the count, on account of the count being exactly what the contract pays them for.

Whatever the commercial arrangement looks like, the licence is yours. In Great Britain the Gambling Commission's social responsibility code 1.1.2 makes licensees responsible for the actions of third parties they contract with for any part of the business related to the licensed activities, and affiliates sit squarely inside that. The same provision says your contracts with those third parties have to bind them to your licence conditions and codes of practice as if they held the licence themselves. They also have to oblige the third party to give you the information you need for your own reporting, and let you end the contract promptly if it breaches the terms, with an affiliate breaking an advertising code named in so many words.

The Advertising Standards Authority looks at it the same way from its own side. In September 2017 it ruled against four operators, Sky Vegas, Ladbrokes, 888 and Casumo, over advertorials dressed up as news stories that an affiliate had published for them. The affiliate had broken its own terms in publishing them, and the operators had pre-approval rules and monitoring in place, mind you. They were held responsible all the same, as the beneficiaries of the marketing.

Now put a network in the middle of that. The ad that gets you a letter was written by an affiliate you have never spoken to, under a contract you have never read, between the network and somebody you could not name. Your own contract is with the network. So the code's requirements only reach the affiliate if the network's terms with its affiliates carry them down, and if the network can actually get a page pulled or a deal ended quickly when you ask. Most networks working in regulated markets will tell you they can. It is worth seeing the clause in their affiliate terms before anything goes live all the same, since the call about the page comes to you.

US licensing raises the same question in a different shape. In New Jersey an affiliate earning a share of revenue, or a mix of revenue share and fixed fees, has to hold a casino service industry enterprise licence of the ancillary kind, and one paid flat fees registers with the regulator as a vendor instead. So the regulator there cares how each affiliate promoting you is paid, and behind a network that can be a question only the network is able to answer. How each state treats affiliates is laid out in our US casino affiliate marketing guide.

A network runs its own tracking. Its affiliates' links point at the network's tracker, the tracker passes the player on to you, and when the player registers and deposits your platform tells the network through a postback, which is how the network knows whom to pay. The mechanics of that are in our walkthrough of postback URL setup. By the end of the month there are two counts of the same players, yours and the network's, and they will not always agree.

Mostly they drift apart for dull reasons. The two systems close the month in different time zones, so a player who deposits at twenty past eleven on the last night of October can land in October on one side and November on the other. A postback fails for a morning and nobody notices until the totals get compared. A CPA you reverse three weeks later, after a chargeback or a duplicate account turns up, comes off your count straight away. The network may have paid its affiliate for that player already, though, and getting money back out of a chain of three companies goes a good deal slower than getting it back from one.

Fraud sits awkwardly one step removed as well. Traffic an affiliate bought cheaply from somebody else and passed on, or players handed something in return for signing up, can be hard to spot when you cannot see which site they came from. Whatever checks the network runs were set up with the network's own risks in mind, and those are not quite the same as yours. What tends to help is agreeing up front whose count settles the invoice, how long you have to reverse a player, and who carries the cost when a reversal lands after the network has paid out. How detection works on the operator's end is covered in our piece on affiliate fraud detection.

A network earns the difference between what you pay it and what it pays its affiliates, and for the work it does that is a reasonable way to be paid. You just do not usually get to see how big the difference is.

Take a made-up month to see the shape of it. The numbers are invented for the purpose, so nothing here is what any particular network charges. Say you pay a network a hundred and fifty euros for each qualified player and the network pays the affiliate who sent that player a hundred and ten. Forty euros a player stays in the middle. At two hundred qualified players a month that comes to eight thousand euros, or ninety six thousand over a year, and it is money you would not be paying if those same affiliates sat on your own programme at the rate the network gives them.

Set that against what an in-house programme costs to run, which is mostly people. An affiliate manager, maybe two, the software, somebody keeping an eye on what partners publish, and the finance time payouts take every month. At two hundred players a month the sum can go either way, depending on your market and your salaries. At twenty players a month the network is nearly always cheaper. At two thousand the margin would be paying for a team several times over, and that is a big part of why so many operators start a market on networks and end up running their own programme once it grows.

The margin has a second effect people tend to notice later on. The affiliates doing the work are being paid less than you are paying for them, and the good ones have usually gone and worked that out for themselves, so some of them would happily work with you direct. Network agreements often have something to say about that, usually a clause stopping you signing the network's affiliates yourself for a period after the deal ends, and it is a clause worth reading before anybody on your team goes off recruiting.

It shows most plainly on the morning after you leave a network. The links that were sending you players were the network's links, pointing at the network's tracker, so where they send people from that morning on is the network's decision, and it has other brands to send them to. The affiliates were the network's affiliates. The record of which of them sent good players, built up over however many months you were there, sits with the network too, and nothing obliges it to hand that over.

What stays with you is the players already on your books, who are your customers whichever way they arrived, and your own count of what the network delivered as one partner. If the deal included revenue share, look at what the contract says about players the network brought in before the end date. Plenty of agreements keep paying on those players for life, or for a set number of years, and that bill goes on arriving well after the traffic itself has stopped.

Moving an in-house affiliate programme looks very different, mind you. Change software and the partners come along, their deals and their history with them, on account of the relationships having been yours from the start. That is not effortless either, and our guide to migrating an affiliate programme goes through the parts that go wrong.

None of this makes in-house the easy option. You start with nobody, and finding the first fifty affiliates worth having is slow, patient work, writing to people, being turned down by most of them and agreeing deals with the ones who say yes. Our piece on finding affiliates for iGaming brands covers where to look. Most of the partners who join in the first year will send few players or none at all, and a handful will send nearly all of them.

Somebody has to run it. An in-house affiliate programme needs an affiliate manager who answers the emails, sorts out disputes about missing players, chases creatives and keeps an eye on what partners publish in your name, and under code 1.1.2 that last part is your responsibility with nobody in between to share it. It needs terms written before anybody signs, a commission structure that holds together, tracking wired into your platform and payments going out on time. Each of those gets worked through in turn in our walkthrough on setting up a casino affiliate program.

And it takes a while to pay back. An operator moving from a network to a programme of its own usually spends a few months paying for a team and software while the traffic is still building. Leaving the network contract running alongside for that stretch is often the least painful way through it.

Most operators past a certain size end up with some of each. This is how the three arrangements compare on the points that usually decide it.

The regulator row reads the same all the way across, and it is the one part of this decision that never changes whichever column you pick. Everything else trades speed and reach against seeing your own partners and keeping the margin, and the third column is what operators tend to settle on when they want a bit of each.

Running your own programme does not mean dropping networks altogether. Plenty of operators sign a network into their in-house programme as one partner among many, much as they would a master affiliate who brings sub-affiliates along, and how those arrangements are tracked and paid is set out in our explainer on sub-affiliate and master-affiliate structures. The network gets a tracking link and a deal from you like anybody else. Its players turn up in your reports next to everybody else's, counted by your own tracking.

Most of what makes it work gets settled before the first player arrives. The big one is sub-IDs, each of the network's affiliates passed through under its own ID, ideally with the site it belongs to, so that a bad source can be switched off without the whole network going with it. Networks vary a lot in how much of that they will agree to, and it is far better found out before signing than after. The code 1.1.2 terms belong in the contract, along with the right to have a page pulled quickly, and so does an answer on whose count settles the invoice. After that the network's team can get on with recruiting in the markets where you have nobody, which is the job they are good at, and your own programme grows up around it.

There is one further arrangement some operators go for, which is having an agency run the programme for them. The partners and the tracking still sit on the operator's own platform and the agency supplies the people, so if the agency leaves, the programme stays put. That is really an in-house programme with outside staff rather than a network.

On MAP the programme is yours from the first partner. Applications come into one control panel, where your team approves them, looks over each profile and decides which deal a partner gets. A partner who runs several sites sets up a profile for every one of them, and campaigns can be tracked down to each placement, so somebody with ten sites does not show up in your reports as a single blur. Tracking runs server to server through our MasterPostback™ technology, which an affiliate manager can set up without a developer and without touching the code on your site.

A network signed in as a partner gets a deal from the same plans as everybody else, CPA in its standard, tiered or progressive forms, revenue share flat, tiered or progressive, CPL, hybrid, or a bespoke plan built around one partner's performance and placements. Our APIs let partners, affiliates and networks pull their figures into their own BI tools, which spares your team the monthly job of sending a network spreadsheets it could be reading for itself. Inside your own team, admin users can be given limited access, so whoever handles payments need not see everything the person approving affiliates sees. Commission is settled through the inbuilt self-invoicing, with the payment methods and thresholds you choose.

The partner portal can carry your brand rather than ours, on your own domain if you want it there. Pricing is flat with no per-click fees, so the bill does not climb every time a partner sends more traffic. Our account managers handle the integration, or the move off your current platform, and your affiliate managers get full training and support. The rest is listed on the features page.

Software does not come with affiliates. An in-house programme on the best platform going will send you no players whatsoever until somebody has gone out and signed partners, and that work is the same whichever platform you choose. If you have nobody to do it yet, a network is probably the better buy for now, and the platform can wait until you have.

Nor can a platform make a network share what it would rather keep. If a network will only give you a count, your reports will show that count and nothing underneath it. What software does is make the arrangement easy to set up properly when the network is willing, and show you clearly which partners are sending what.

The compliance work stays with people as well. Somebody on your team still has to read what partners publish, act when a page breaks the rules and keep the contracts up to date. A platform helps by keeping every partner, their sites and their deal in one place, so the person doing that work knows where to look. The reading itself they still have to do their own self.

Pull out last quarter's invoices from every network you use and set them next to what your own partners did over the same months. The comparison that matters most is how many of each source's players are still depositing ninety days on, and the difference usually shows within a few minutes of looking. Then put a rough number on the margin, what you paid each network per player less a fair guess at what its affiliates got, which a couple of affiliates you trust will tell you if you ask them. For each network, write down honestly what you can say about where its players came from, and do that bit your own self rather than asking the network. For some it will be a site and an affiliate. For a fair few it will be a publisher number and not much else.

While the contracts are out on the desk, read the clause on signing the network's affiliates directly, and the one on what happens to revenue share after the end date. Then ask each network to show you how the code 1.1.2 terms reach the affiliates who actually publish your ads, and see how long the answer takes to come back.

If the figures make a case for bringing some of that traffic in-house, a demo set up around your own markets and commission plans will show you how the programme would look on MAP, networks signed in as partners included.

What is the difference between an in-house affiliate programme and an affiliate network

On an in-house affiliate programme the operator signs affiliates directly, tracks them on its own platform and pays them itself. A network puts itself in the middle, signing the affiliates, tracking them on its own system, taking payment from the operator and paying its affiliates out of that. The operator deals with one partner instead of hundreds and sees a good deal less of who is actually sending its players.

Is an affiliate network cheaper than running an in-house programme

At low volumes it usually is, since you pay only for players who qualify and skip the cost of a team and software. As volume grows, the network's margin on every player adds up to more than an in-house team would cost. Where that crossover sits depends on your market, your CPA rates and what you pay your staff.

Can an operator run an in-house programme and use affiliate networks as well

Plenty of operators do both, usually by signing each network into the in-house programme as a single partner with its own tracking link and deal. Asking for the network's affiliates to come through as separate sub-IDs keeps the source of each player visible, and the contract should carry the regulator's third-party terms down to every affiliate behind the network.

Who is responsible for affiliate ads placed through a network

Responsibility stays with the operator, network or no network. In Great Britain the Gambling Commission's code makes a licensee answerable for any third party it contracts with, and the ASA has ruled against operators over affiliate ads on the grounds that they benefit from them. A network in the middle does not move any of that, so the contract with the network needs to pass the right terms down the chain.

What happens to players when an operator stops working with an affiliate network

Players who have already signed up stay with the operator as its customers. The affiliates and their links stay with the network, so new traffic from them stops. On revenue share deals the network may go on earning from the players it referred before the end date, for a set period or for life, depending on what the contract says.