Network policies not affiliates cause rakeback problems, says RakeTheRake chief 08/07/2009

Anonymous

I'd say the problems STARTED with RakeTheRake.

Not the voice I'd be turning to in defending rakeback at all.

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Anonymous

Agree to that.

RakeTheRake even puts "how to delete your cookies & uninstall your software"-stuff in their download guides.

From my point of view, RtR's business model is based on player poaching only. Wouldn't wonder if they even get a lot of FTP players to illegally retrack to them because they add value with a rake race.

But I don't blame Mr. Wilkins here - he has to defend the status quo with rakeback affiliates as he has no other business model to turn to.

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No Bull Rakeback

I run a rakeback site and also suggest players delete cookies before downloading.

The reason for these instructions is to avoid a situation where the player downloads from my site because he wants rakeback but later finds out he's been tagged to a non-rakeback affiliate because of an old cookie on his computer. It has nothing to do with poaching.

The problems with rakeback begin at the network level, not the affiliate level. Stricter network rules, and aggressive policing by the networks to ensure all affiliates follow their rules, is the long term solution.

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Chalkie

Karim is one of the most honest and genuine people i have ever had the chance to meet in this industry.

I do not think that anyone is in a position to question Karims integrity and think that there is no better person to speak on this subject in its defence.

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Anonymous

It's not a question about Karim's integrity, it is the rightful question about his business model.

I think it is pretty obvious that in contrast to e.g. Pokerlistings [acquiring SEO traffic & optimising conversion] and PokerNews [being the best news publisher], RakeTheRake has a sole way to acquire customers: mouth to mouth on the fact that for regulars it is most of the time a little more profitable to track through RtR because next to the maximum allowed bonus / rakeback, they try to put some RakeRaces etc. on top.

If they would just get the standard deals from the poker rooms, most of these players would chose either...
1. the poker room directly because it does not make a difference and RtR does not add value
2. another affiliate who adds some - non-monetary - value

A company like RtR squeezes everyone's margins as they have a very lean cost structure [a little B2B, a simple web site] compared to big media affiliates like PokerNews or those who have marketing expenses on their own.

I fully agree that the kickstart towards more regulations should root within the networks and their policies, even though all participants in the industry [networks, rooms, affiliates, players] should be consciuous about the long-term harm business models like RtR might afflict on everyone.

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Affiliate doing Rakeback and Non-Rakeback traffic

Let's not forget that affiliates like Pokerlistings also do rakeback (via Rakebrain and numerous other sites , RRR) and they also retain players via regular freerolls which is them putting their commission back in to the system to attach players. Thing about Listings is they are sharp guys and instead of moaning, they adapted.

Rtr and other affiliates aren’t squeezing margins at all. They get paid the same as regular affiliates but they give some back to the players.

Ask any poker room what they would prefer

A) An affiliate bringing thousands of players in, and putting 90% of their commission back in to the system through the players to rake more and generate more revenue

and

B) An affiliate bringing thousands of players in, and keeping 100% of their commission (assuming both types of affiliates have marketing costs) and not putting anything back in

and they will ALL choose (A)

There is no long term damage being done. Every industry has people who come in and find a way to give more back to the end user : "Buy a new car and get $2000 cash back" etc and they have all survived just fine.

And there is no stealing going on. There seems to be some common misapprehension that just because the first car you buy is a Chrysler - you're never allowed to buy a Ford when a different dealer is offering a way better deal. Just the same a player who starts to play at Absolute should be allowed to switch to Full Tilt once he has become more poker educated.

The networks need to reign it in. Prima for example allow Purple to offer 45-55% rakeback to players discretely through affiliates – despite having a 30% cap. That is what causes players to move skins.

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Anonymous

They will all chose (A) because they are plainly not clever enough to understand the consequences.

Let us do an extreme example scenario on a Poker Room XYZ:
* on XYZ, players may freely chose and change their affiliate
* on XYZ, affiliates are free to give back to players whatever they want

What will now happen?
1. There will be an affiliate who just says: "I dont do marketing etc., I just give back 99% of what I earn and am happy to live with that 1% because I have no costs."
2. Other affiliates with a cost structure [costs they use to acquire genuine new players, for example!] get squeezed and thus have less money to invest.
3. Poker Room XYZ will shrink because there is no incentive for affiliates to invest.

It is the same story with affiliates as with skins on a network. It is *obviously* not good to let them give rakeback at will, because it punishes those skins/affiliates who invest to add value to the whole industry.

You can put it any way: RtR and comparable affiliates do not bring in a single new dollar to the poker industry. All they do is poach from A to B or even from A to A and live from that.

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Affiliate Manager at Room that works with RTR

Anonymous you are clearly speaking from a position in the dark when you say "RtR and comparable affiliates do not bring in a single new dollar to the poker industry" . We received an email from RTR only last month about them Sponsoring the English Poker Open - an event they are spending hundreds of thousands of dollars on and which will be webcast and televised. That sort of marketing is no less equivalent to any XYZ Poker room putting out their own ad or setting up their own tournament and getting people interested in online poker. Sadly we couldn’t take any packages off them, but while your point might be valid for some affiliates (rakeback and non), it certainly is not valid for them.

Regards etc.

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Player

Margins will shrink in any upcoming industry. Nothing you can do about that. The leanest sites and affiliates will survive.
Instead of blaming others one would do better by looking to improve their own business in important area's like customer service, incensitive programs and advertising.

I once left mansion poker because of their horrible customer service. So it makes no sense to spend tonnes on advertising if you don't get the other things right.

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Anonymous

Karim is the canny guy who exposed the loop in poker marketing. RB though has got out of hand, and there is simply too much undercutting. I dont think you can get rid of it, but networks have to be tougher on who they hand out licenses to.

There is much debate about poker RB, nevertheless poker has other problems. The marketing is expensive and the majority of players offer little value.

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