Now, twelve years later, he’s a super affiliate specializing in the online bingo space. In the latest video interview with top iGaming super affiliates, Phil describes the path he’s taken his company, Focus Online Management and widely-recognized, award-winning bingo portal, whichbingo.co.uk to become a leader in the bingo space amongst hundreds of bingo competitors in the UK market. (Showing his modesty, Phil even gives friendly shout outs to his fellow competitors in the industry in this video.)
Phil also shares some of the secrets of long-term sustainable success in the iGaming industry.
About Phil Fraser
Phil Fraser’s background is in advertising agency and advertising sales. He moved to the client side to William Hill in 2000 and was head of the online casino, launching their first ever online casino on Cryptologic. At William Hill, Phil was tasked with looking into the online bingo market and from there moved into consultancy and ran a portal (WhichBingo.com) and a very early bingo skin (via DCEG/Cyberbingo) as a ‘hobby.’ From that hobby site, Phil has grown into his business, Focus Online Management, business to encompass a variety of portals, including whichbingo.co.uk.
Raw Transcript
Announcer: Before we get started I would like to introduce you to our sponsor Microgaming’s first scratch card and instant win product, Wintingo. Since Wintingo is a fresh new scratch card program, the opportunity for player acquisitions is huge. CAP fully endorses Wintingo and here are the top five reasons you should join Wintingo today. The program is backed by an experienced and trusted management team. They have exceptional financial backing, and collectively, more than 15 years experience in the iGaming industry.
Wintingo has, by far, the best player promotions in the scratch card vertical, such as offering a euro 100 no- deposit bonus. Wintingo also targets very lucrative markets, so if you have traffic in the UK, Australia, Canada, Netherlands, Spain, Sweden or Germany, Wintingo will be a high converter for you.
Wintingo works with affiliates on rev shares, CPA or CPL opportunities and only with CAP, you can cash in on an exclusive offer to receive a 40% rev share during the first month of promotion. The scratch card vertical is growing tremendously in this space and Wintingo is the perfect opportunity to get in on some major earning potential. Visit the CAP Directory and join Wintingo today.
Warren Jolly: Hello everyone I’m Warren Jolly with casinoaffiliateprograms.com and I want to welcome you to today’s interview with Phil Fraser—super affiliate specializing in the online bingo space. Phil’s company, Focus Online Management, operates a widely-recognized award winning bingo portal, whichbingo.co.uk among several others with the primary focus in the UK market. Phil’s one of the most successful bingo affiliates in the industry and he’s been running his sites for nearly 12 years. In our interview, we will learn how Phil went from proposing online bingo sites to the Board of Directors at Will Hill during his employment there to running a multimillion-pound business with seven full-time staff. Phil will also share some of the secrets of long-term sustainable success in the iGaming industry.
Phil, it’s great having you today. Thank you very much.
Phil: Thanks for having me.
Warren: Let’s start out by talking to our audience a little bit about your history, how you got involved in the iGaming industry and especially how you got involved in online bingo itself.
Phil: We have to go all the way back to the start of the Internet. My background is in advertising. I was working for an ad agency when the Internet boom really started. As part of my role, I was responsible for client’s websites and stuff like that, but I always wanted to go client-side. I happened to get a job at William Hill who are based here in the UK in Leeds where I am and I was taken on as a casino manager. I launched the William Hill Online casino on Cryptologic back in January 2000. It seems like a long time ago, now, and bearing in mind what William Hill and Playtech looks like now, the casino department was me with a couple of staff.
During my time there I was asked to look at bingo and determine if we should go there next. I did a presentation to the board. They, in their wisdom, at the time, decided it wasn’t right for them and it was left aside. Having done that, I looked at this and thought, there might be something in this, and parted company with William Hill at the end of 2000. And in effect, took this report and thought, I can do something with this. I put together a business plan, in fact, to launch a pay-to-play bingo site and then went around to the markets trying to raise the funds to do that.
This was a time when the Dot-com bubble had just burst. Nobody in the UK had heard of online bingo. It was very gray in the US. So it was not, really, the best time to pitch an idea like that. So, that didn’t happen, but what I had done in the meantime was set up whichbingo.com, basically, as a site to garner information about market, as a support to this pitch that I was doing. So, when that didn’t happen, I kept on working on the portal as a hobby. I set up my own consulting firm and worked with people like Victor Chandlers, Little Woods and people like that. I became an advocate of online bingo almost by accident. So, those were the people who were around in the market in 2001, 2002 and 2003.
You probably heard me speaking at various conferences that bingo was going to be the next big thing, which, at the time, may have been a bit of a guess. I can’t say I was a great soothsayer and guessed how big it would be. But, that was how I got to where I was, or where the portal got to. That was the starting point really.
Warren: Okay. So you chose bingo in 2000 as your focus. It sounds like it’s based on the report that you did for Will Hill and then going out and trying to raise your own funds. A lot of research went into this upfront. You didn’t just happen to guess that bingo would be where it is today. Is that accurate?
Phil: Yes. It’s funny looking at it now, but when we launched the William Hill Casino in 2000, I felt in the back of my mind, we are a bit late to the party here, which, looking back now is not the case. Looking at bingo at the time, there were no more than 10 to a dozen sites across the whole world. Just on a basic numbers situation, if you could be 13th, 14th, or 15th into the market, and you could see the size of the casino market at the time, this is obviously pre-poker as well, it was almost a numbers thing. It made me think, “Well, you know, there’s got to be a bit of opportunity in here, somewhere.”
Warren: And who are some of the key operators in the bingo space at that time? You said there are a handful of companies. Who were the ones that you remember?
Phil: At the time there were probably two or three software providers. One of them was called DC and G, now Parlay. There was a company out of America who are now Bingo Entertainment and a couple of independents as well. That really was it. What is now Parlay and what was then DC and G was the only major operator out there. You look at the business model that most people work on now in the bingo market, which is a network model, almost all of them were stand-alone.
Warren: Okay. So what are the key demographics of a bingo player online and what are some of the expected lifetime player values in this vertical?
Phil: Looking at the UK, you’re probably looking at female, 35 to 55, down markets, not necessarily the little old ladies you see going to bingo halls, but probably, their daughters and, in many instances, their granddaughters as well. So, it’s probably the same demographic, but slightly younger. In terms of lifetime values, it’s hard to tell. From our point of view, we don’t see a lot of those sort of stats. People talk about 300 to 400 pounds lifetime. It’s difficult to put a finger on it. The one thing I can say about lifetime value is small amounts over a long period of time, rather than 100 pounds, 100 pounds, 100 pounds and they’re gone after four months. It’s, probably, more like 25 pounds, 25 pounds, 30 pounds a month but for a longer, longer period.
Warren: How many months, would you say, is the average tenure of a bingo player?
Phil: The thing about bingo is, a lot of people who play it play it as an entertainment. Obviously, they want to win but it’s not their prime motivation. It’s part of their entertainment mix. So if you said, “Okay you’ve got 100 pounds to spend,” they might spend some of it going to the cinema, some of it going out for a meal, some of it playing bingo, some of it buying a lottery ticket. It’s in that park that they’ll spend, rather than a gambler might say, “I’ve got 100 quid my pocket to burn. I’ll burn it.” It’s a different park. So, lifetime values, with a lot of bingo players, is endless.
Warren: So it could be 12 months or greater in terms of longevity of a player on a certain road?
Phil: For example, as part of our business, we run a free bingo game and that game has been going since 2005. It’s a free game and not a pay game. We’ve got people who are still playing who signed up on day one. I don’t think these people will stop playing. What they might do is very they’re spending, but over their lifetime… In the UK, we’re probably five or six years into the lifetime of the business or of the sector and, I think, people just keep going.
Warren: Okay. So, looking at your overall business, what percentages of affiliate revenues versus paid media or anything else, or is it just 100% affiliate revenues, in terms of your income?
Phil: As I said, my businesses is advertising and before that it was selling advertising space. So the business model I knew was selling ad space. It was interesting, watching last week’s interview with Brian Bailey, who said exactly the same thing, which was, back in the early days, you were dealing with some weird and wonderful companies in Costa Rica, Dominican Republic and Antigua. Ryan’s thinking was exactly the same as mine, which was, “You send me the money and I’ll run your ad.” Not the other way around.
Brian is exactly right because that is exactly what we did as well. It was all pre-payment, upfront. If the money doesn’t arrive, we won’t run your ad. Send me the money and we’ll run your ad. So the first, maybe, four or five or six years of the business, the vast majority of the revenue was just paid-for media. As the UK market developed and as the business models developed we had more clients who would say, “No. I’m not spending. I’ll do affiliate with you.” So we were probably 60/40 paid-for versus affiliate. The affiliate model is getting larger and the paid-for is reducing slightly.
Warren: Where do you see that being in about three years? Do you see it flipping or do you see the affiliate model being the majority of the revenue?
Phil: Over the last three or four years, the affiliate market has grown and I have no reason to believe they won’t continue growing. I think some of that comes down to, and I use the word loosely, education that new entrants to market get, either from software providers or from other people who say, “Well, look. This is a great market. You can launch into it and you don’t have to spend any marketing money.” Yes, obviously, to a degree that’s true with affiliate, but it’s not the be-all and end-all. So, what I think we’ll find is that the bigger brands will have marketing budgets and the smaller brands will go down the route of, “Well, I’m not going to spend any money but if you send me some players, I’ll send you some money back.”
Warren: Okay. So out of your affiliate business, today, what percentage is CPA versus revenue share? Also, what’s the model you prefer?
Phil: It’s all lifetime revenue.
Warren: All rev share. Okay.
Phil: On the basis that a bingo player, for example, might only drop 10 pounds or 20 pounds in the first month, or two months or something like that. We know, full well, over one year, two years, three years that player is going to spend a lot more money than whatever CPA we might get from a site.
Warren: Okay. And you’ve been in the business long enough to know that firsthand.
Phil: Absolutely. I’ve always run this business as a long-term business rather than, just how much money can we gain straightaway. So we are comfortable waiting for that longevity of the lifetime revenue to come in.
Warren: Okay. Could you share with our audience any of the conversion rates in online bingo? Obviously, not click to sign up, because a click is not click, but from sign-up to deposit, for example, what’s the ratios that you see? And if you can’t share any click database on your target traffic, that would be helpful as well.
Phil: It’s interesting, what we’ve seen recently are somewhat I would call “odd stats,” in that we’ve got sites which simply skins of a network, so the product is no different to the last version of the product, or the skin before, or the skin before that, with some really great sign-ups and really great numbers. Conversely, we’ve had sites that run much smaller networks and have been seen a lot less, out and about, and the sign-ups are great but the conversions are dreadful, to be honest. So it really does vary. From click to sign up, we’ve seen everything from 2 to 3% to 25%. It really does very. But we also see a lot of is, it depends not only on the click but what happens after the click. So, we can run two campaigns exactly the same, same exposure, same acquisitions, they might send the same amount of traffic to both sites, one converts and one doesn’t. And that’s down to offer, down to creative, it’s down to the flow on the site once you get there. There are a lot more variables outside what we do than we can control, and to a degree that’s one of the reasons why, as a business, we prefer ad sales rather than affiliate.
Warren: Share the risk?
Phil: Yes. Absolutely. If a client says, “I’ll give you 100 pounds and you have to deliver 100 clicks to Client A,” and he converts none of them and I deliver 100 clicks to Client B and he converts half of them, how have I done my job any differently, between the two? The variable is what they’ve done not what I’ve done, so I should be paid for what I do, rather than, my success, or otherwise, being down to something that is outside of my control.
Warren: That makes perfect sense. So why do you think you’ve been able to maintain such a successful hold in the UK markets, specifically, in bingo, even with all the heavy competition that’s entered the space in, say, the last three or four years?
Phil: It’s a difficult one to answer without blowing your own trumpet, but I’ll give it a go. We were in the market early, which was fortunate for us. In fact, we actually started in the US market and expanded into the UK market. Our first version, which being in the UK, actually, we had to have a land-based directory in it, because there wasn’t any online. We sort of waited for the market to happen in front of us. We were there early.
We’ve always tried to do the right thing. We’ve always tried to build a site with quality on it, quality of product. My thinking has always been, if you build a good enough product, people will come, people will come back, people will stay and then click on ads, etc.
What I’ve managed to keep and I tried to translate to the team is an enthusiasm for the business, as well. I’m not a bingo player, but I’m enthusiastic about the online bingo industry and the online bingo market. I try to put that over to the people and I try to put that over to external people as well as the team, and that enthusiasm, hopefully, translates into a decent product online, which the site is appreciated and utilized and [they] come back. In the last year, specifically, we really tried to be innovative, tried to do different things. With the onset of things like WordPress it’s very easy to knock up a half-decent website, without any real skill. So, we’ve had a really push what we do to keep ourselves ahead of the market. Some of the works and some of it doesn’t, but were willing to give it a try just to stay ahead of the market.
Warren: Just touching on WordPress really quick, because this is a question we get very often, is that the CMS of choice for you and your operation, now?
Phil: On our main site it isn’t. WhichBingo has a CMS we had built for us, so it does exactly what we want it to do. Our free bingo game is an external piece of software, so, again, that’s a unique CMS. Within the business, we have a number of blog sites, which, yes, we do use WordPress on, because it’s easy, because it’s simple to knock something up. From our point of view, it works well as a support tool, where others, and I’m not knocking it, it’s a great piece of software, but it’s a main tool for other people. Yes and no is the answer.
Warren: Okay. So just to give our audience an idea of the size of your operation can you share your numbers in terms of unique visitors per month that your network achieves and, also, how many new depositing bingo customers are you delivering to operators?
Phil: We haven’t got specifics on that sort of stuff but I can give you some guidelines. Our free bingo game, which, as I say, has been live since 2005, we’ve got in excess of a quarter of a million people registered on that game. Now, that’s not to say they all play on the same day and, obviously, a lot of those people are not active at the moment, but that’s the size of the operation we’re talking about. Something like WhichBingo UK will probably see 30 to 35,000 uniques a month. A lot of those people will return on a regular basis, maybe not day on day or week on week. Naturally, they’re not all going to deposit and register on a new site every time they visit. So we will have areas of business where we have repeat traffic that we are not monetizing, but that’s part of the bigger picture of what we do.
Warren: Okay. And depositor volume, can you give us a range? Is it a-thousand-plus depositors a month? What would you say the neighborhood is?
Phil: Because such a large part of the business is paid-for advertising, we often don’t get stats back from clients. So our client will book an ad campaign and the simplest feedback we get is whether they book next month or not and that’s usually the best gauge of whether it worked or not.
Warren: I see. Okay. So the numbers are a bit convoluted?
Phil: It’s hard to pin it down. It’s not something that we track on a specific basis. We have a wide range of clients and a wide range of affiliate accounts as well, that we use. So, to actually collate all those together would take a month to do.
Warren: So how do you manage the business on the revenue side? Are you just looking at end-of-the-month dollars or pounds, in your case?
Phil: Yes. That tends to be the case. The first protocol is our sales. The inventory that we don’t sell, we’ll sit down and say, “Okay. Which affiliate accounts are we going to use to fill the space or use mailers?” That will be judged either by how our affiliates performed the month previously, whether they’ve gotten an offer at the moment, whether they’re on TV or whether they’re actually marketing directly to affiliates, which is something that I’m always surprised that so few affiliate managers do. From a very simple point of view, if an affiliate manager comes to me and says, “Look, we’ll give you an extra X% on your lifetime revenue for the next three months,” or “Send us 20 FTDs and we’ll send you an iPod, or something like that,” they’re motivational tools. We’ll say, “All right. We’ll use that one rather than that one.” The simplest decision is, “What was the size of the check that one sent last month? It’s obviously working. Let’s carry on.”
Warren: Okay. So, with larger brands, take Foxy or Wink Bingo, for arguments sake, are you finding them tougher to convert nowadays? They’ve been in the space a very long time, they’ve done a ton of paid media, especially in the market. You’re focusing on the UK. What are your thoughts about that? What are you seeing in terms of conversions with brands like Foxy?
Phil: I’m really pleased you asked me this question, because this is my current soapbox issue. So bear with me on this one. To explain this let’s do some very simple maths or math as you call it. These figures are used, for example purposes only, so anybody out there, don’t quote me on them. Let’s say the UK market has a million online bingo players, for argument’s sake. Let’s say a Foxy has 800,000 of those players in their database, somewhere. Compare that to a new brand that’s just launched which has a database of, let’s say, 100,000 players. If I show a Foxy Bingo ad on my page, potentially, I’ve only got 200,000 people who could click on the ad, become a new registered player and become an FTD and then we’d take some money out of it.
Compare that to the new client who’s only got 100,000, then 900,000 that’s been pooled might have a chance of clicking on that banner and becoming a player tagged to us and we get their lifetime revenue. So purely from a statistical point of view, running banners for the larger brands, on an affiliate basis, just on basic, basic statistics becomes less and less viable as a means to generate revenue. What it probably ends up doing is, I’m actually doing a CRM job for somebody like Foxy or Wink or whoever it might be, because somebody that sees the banner who’s registered to another affiliate, or whatever they’re tied to, sees the ad and goes, “Oh, I remember them. I played that for awhile. I’ll go back.” Fantastic news for the brand, for Foxy and, it comes down to pounds shillings and pence, we get no money for doing that.
I’m just putting things up in the air there but you can see that as a brands get bigger it becomes less effective for an affiliate to actually run affiliate marketing for them. Now, I’m quite happy to run [Pay Foster 24:27] for them because, in that instance, they’re paying for the CRM side of things that I’m doing, the restart I’m doing for people. The problem is, and this is almost the core of the market, affiliate managers, I would guess, to 100%, are targeted by their losses on registration and new players.
Warren: It makes perfect sense.
Phil: Did I? With the number of people. I just need to make sure everybody understands that.
Warren: I think you used a pretty simple, easy-to-understand, explanation. So thanks for that. So, do you think it’s related at all to a slowdown in the market in terms of, these big brands have a large percentage of the existing bingo market, but you see any slowdown occurring, making it more difficult to convert, even if it’s just purely related to the size of the brand and the player bases they have?
Phil: I think the situation now, as to what sites are doing now, is fighting over the share of the wallet, rather than recruiting people who’ve never played online bingo before. Again, I have no figures quote on this but I can’t believe there are that many people out there who have never played online bingo anywhere else before. There’s very few people who go, “Oh, my God, online bingo, I’ve never heard of that. I’ll go and register at Foxy or something like that.” What you more likely got are people who have registered over a range of sites. That person might only spend 100 pounds every month. So out of their pocket goes 100 pounds. Last month, they spent 25 pounds across for sites. This month they might spend 20 pounds across five sites. So, the actual size of the market or the actual money that’s in the market hasn’t expanded. Four sites have probably seen a reduction in spending by this player and one site has got a new player.
Warren: So the UK market is definitely saturated? We can use that term?
Phil: That is my guess. Having said that, one of the things we have on WhichBingo is a directory that lists every single site in the marketplace, irrelevant of whether a client of ours, or an affiliate, whatever they might be. We list absolutely everybody. This year alone, we’ve seen 50 new sites launched.
Warren: Wow.
Phil: I looked this morning and the total is 354 brands in the UK bingo market.
Warren: Okay. The idea is that the growth in the player market or new entrants who have never played online bingo does not correlate with that same percentage.
Phil: Again, if you do some basic math 350 at 50 is what? Is that six, or something like that?
Warren: Seven.
Phil: Yes, or seven. I don’t think the market is expanding that size. So, again, basic math tells you it has to be people arguing over the same pound.
Warren: Definitely, okay. So, Phil, who are some of your competitors, that you highly respect, and why?
Phil: We have a number of competitors who, I have to say, all do a really great job in the market. Let me name a few of them and say hi to them.
BingoPort is probably our biggest competitor and Scott and the team have done a great job there. They drive huge amounts of traffic and do a really good job.
Bingo Base was one of the early sites out there with us. They continue to do well in the market.
BallsUpBingo with people like Nickie Shute who’s a great writer on everything online bingo and knows exactly what she’s talking about and probably out of the whole market is a person who knows the market best because she is a bingo player.
You’ve got people like FreeBingoHunter who are fairly new to the market and have done an excellent job with a really well designed site.
Bingo Hideout does a really good job and got a name check the guys at Sunlight Bingo and Mad About Bingo… the Edwards boys. How they get into positions they get on Google, I do not know but I wish I was on some of the places that they were.
Then you’ve got Chris at Little Star who does Super Free Bingo, again, been in the market a long time and does a very good job. On the one hand, I wish they weren’t there, because they make our job a lot more difficult, but the majority are really good guys. That’s one of the good things about the online bingo market in the UK, not all of the UK, there are some good guys out there. There’s the odd person who isn’t as good as the others, but they’re all good people, and they all the good stuff.
Warren: I know some of those guys as well and they are definitely some great players in the space. The last question for you Phil. You’ve won many awards during her years in this business. Which one are you most proud of and why?
Phil: Great timing and the question of Warren because last week we were down in London at the EGR Awards and we won the award for Gaming Review Site of the Year. So, that’s across the whole of the online gaming market. My team and me have done some really great stuff this year it was fantastic for them to get the recognition for the hard work they’ve done. There were 700-plus people at the awards ceremony and we are really, really pleased about that award. We were really chuffed about that.
Warren: Congratulations. That’s a big honor.
Phil: Thank you.
Warren: Well, very nice. We’re just about out of time and, Phil, I really want to thank you for offering your insight with our audience today. It’s definitely good to talk to someone who’s been in the bingo space as long as you have. There’s not many out there, as we all know. If anyone is interested in contacting Phil at the end of this interview, please send an email to interviews@casinoaffiliateprograms.com and we’ll be more than happy to put you in touch. Thanks for watching and stay tuned for future interviews with iGaming industry leaders. Take care.
Phil: Thanks a lot.
Wintingo has, by far, the best player promotions in the scratch card vertical, such as offering a euro 100 no- deposit bonus. Wintingo also targets very lucrative markets, so if you have traffic in the UK, Australia, Canada, Netherlands, Spain, Sweden or Germany, Wintingo will be a high converter for you.
Wintingo works with affiliates on rev shares, CPA or CPL opportunities and only with CAP, you can cash in on an exclusive offer to receive a 40% rev share during the first month of promotion. The scratch card vertical is growing tremendously in this space and Wintingo is the perfect opportunity to get in on some major earning potential. Visit the CAP Directory and join Wintingo today.
Warren Jolly: Hello everyone I’m Warren Jolly with casinoaffiliateprograms.com and I want to welcome you to today’s interview with Phil Fraser—super affiliate specializing in the online bingo space. Phil’s company, Focus Online Management, operates a widely-recognized award winning bingo portal, whichbingo.co.uk among several others with the primary focus in the UK market. Phil’s one of the most successful bingo affiliates in the industry and he’s been running his sites for nearly 12 years. In our interview, we will learn how Phil went from proposing online bingo sites to the Board of Directors at Will Hill during his employment there to running a multimillion-pound business with seven full-time staff. Phil will also share some of the secrets of long-term sustainable success in the iGaming industry.
Phil, it’s great having you today. Thank you very much.
Phil: Thanks for having me.
Warren: Let’s start out by talking to our audience a little bit about your history, how you got involved in the iGaming industry and especially how you got involved in online bingo itself.
Phil: We have to go all the way back to the start of the Internet. My background is in advertising. I was working for an ad agency when the Internet boom really started. As part of my role, I was responsible for client’s websites and stuff like that, but I always wanted to go client-side. I happened to get a job at William Hill who are based here in the UK in Leeds where I am and I was taken on as a casino manager. I launched the William Hill Online casino on Cryptologic back in January 2000. It seems like a long time ago, now, and bearing in mind what William Hill and Playtech looks like now, the casino department was me with a couple of staff.
During my time there I was asked to look at bingo and determine if we should go there next. I did a presentation to the board. They, in their wisdom, at the time, decided it wasn’t right for them and it was left aside. Having done that, I looked at this and thought, there might be something in this, and parted company with William Hill at the end of 2000. And in effect, took this report and thought, I can do something with this. I put together a business plan, in fact, to launch a pay-to-play bingo site and then went around to the markets trying to raise the funds to do that.
This was a time when the Dot-com bubble had just burst. Nobody in the UK had heard of online bingo. It was very gray in the US. So it was not, really, the best time to pitch an idea like that. So, that didn’t happen, but what I had done in the meantime was set up whichbingo.com, basically, as a site to garner information about market, as a support to this pitch that I was doing. So, when that didn’t happen, I kept on working on the portal as a hobby. I set up my own consulting firm and worked with people like Victor Chandlers, Little Woods and people like that. I became an advocate of online bingo almost by accident. So, those were the people who were around in the market in 2001, 2002 and 2003.
You probably heard me speaking at various conferences that bingo was going to be the next big thing, which, at the time, may have been a bit of a guess. I can’t say I was a great soothsayer and guessed how big it would be. But, that was how I got to where I was, or where the portal got to. That was the starting point really.
Warren: Okay. So you chose bingo in 2000 as your focus. It sounds like it’s based on the report that you did for Will Hill and then going out and trying to raise your own funds. A lot of research went into this upfront. You didn’t just happen to guess that bingo would be where it is today. Is that accurate?
Phil: Yes. It’s funny looking at it now, but when we launched the William Hill Casino in 2000, I felt in the back of my mind, we are a bit late to the party here, which, looking back now is not the case. Looking at bingo at the time, there were no more than 10 to a dozen sites across the whole world. Just on a basic numbers situation, if you could be 13th, 14th, or 15th into the market, and you could see the size of the casino market at the time, this is obviously pre-poker as well, it was almost a numbers thing. It made me think, “Well, you know, there’s got to be a bit of opportunity in here, somewhere.”
Warren: And who are some of the key operators in the bingo space at that time? You said there are a handful of companies. Who were the ones that you remember?
Phil: At the time there were probably two or three software providers. One of them was called DC and G, now Parlay. There was a company out of America who are now Bingo Entertainment and a couple of independents as well. That really was it. What is now Parlay and what was then DC and G was the only major operator out there. You look at the business model that most people work on now in the bingo market, which is a network model, almost all of them were stand-alone.
Warren: Okay. So what are the key demographics of a bingo player online and what are some of the expected lifetime player values in this vertical?
Phil: Looking at the UK, you’re probably looking at female, 35 to 55, down markets, not necessarily the little old ladies you see going to bingo halls, but probably, their daughters and, in many instances, their granddaughters as well. So, it’s probably the same demographic, but slightly younger. In terms of lifetime values, it’s hard to tell. From our point of view, we don’t see a lot of those sort of stats. People talk about 300 to 400 pounds lifetime. It’s difficult to put a finger on it. The one thing I can say about lifetime value is small amounts over a long period of time, rather than 100 pounds, 100 pounds, 100 pounds and they’re gone after four months. It’s, probably, more like 25 pounds, 25 pounds, 30 pounds a month but for a longer, longer period.
Warren: How many months, would you say, is the average tenure of a bingo player?
Phil: The thing about bingo is, a lot of people who play it play it as an entertainment. Obviously, they want to win but it’s not their prime motivation. It’s part of their entertainment mix. So if you said, “Okay you’ve got 100 pounds to spend,” they might spend some of it going to the cinema, some of it going out for a meal, some of it playing bingo, some of it buying a lottery ticket. It’s in that park that they’ll spend, rather than a gambler might say, “I’ve got 100 quid my pocket to burn. I’ll burn it.” It’s a different park. So, lifetime values, with a lot of bingo players, is endless.
Warren: So it could be 12 months or greater in terms of longevity of a player on a certain road?
Phil: For example, as part of our business, we run a free bingo game and that game has been going since 2005. It’s a free game and not a pay game. We’ve got people who are still playing who signed up on day one. I don’t think these people will stop playing. What they might do is very they’re spending, but over their lifetime… In the UK, we’re probably five or six years into the lifetime of the business or of the sector and, I think, people just keep going.
Warren: Okay. So, looking at your overall business, what percentages of affiliate revenues versus paid media or anything else, or is it just 100% affiliate revenues, in terms of your income?
Phil: As I said, my businesses is advertising and before that it was selling advertising space. So the business model I knew was selling ad space. It was interesting, watching last week’s interview with Brian Bailey, who said exactly the same thing, which was, back in the early days, you were dealing with some weird and wonderful companies in Costa Rica, Dominican Republic and Antigua. Ryan’s thinking was exactly the same as mine, which was, “You send me the money and I’ll run your ad.” Not the other way around.
Brian is exactly right because that is exactly what we did as well. It was all pre-payment, upfront. If the money doesn’t arrive, we won’t run your ad. Send me the money and we’ll run your ad. So the first, maybe, four or five or six years of the business, the vast majority of the revenue was just paid-for media. As the UK market developed and as the business models developed we had more clients who would say, “No. I’m not spending. I’ll do affiliate with you.” So we were probably 60/40 paid-for versus affiliate. The affiliate model is getting larger and the paid-for is reducing slightly.
Warren: Where do you see that being in about three years? Do you see it flipping or do you see the affiliate model being the majority of the revenue?
Phil: Over the last three or four years, the affiliate market has grown and I have no reason to believe they won’t continue growing. I think some of that comes down to, and I use the word loosely, education that new entrants to market get, either from software providers or from other people who say, “Well, look. This is a great market. You can launch into it and you don’t have to spend any marketing money.” Yes, obviously, to a degree that’s true with affiliate, but it’s not the be-all and end-all. So, what I think we’ll find is that the bigger brands will have marketing budgets and the smaller brands will go down the route of, “Well, I’m not going to spend any money but if you send me some players, I’ll send you some money back.”
Warren: Okay. So out of your affiliate business, today, what percentage is CPA versus revenue share? Also, what’s the model you prefer?
Phil: It’s all lifetime revenue.
Warren: All rev share. Okay.
Phil: On the basis that a bingo player, for example, might only drop 10 pounds or 20 pounds in the first month, or two months or something like that. We know, full well, over one year, two years, three years that player is going to spend a lot more money than whatever CPA we might get from a site.
Warren: Okay. And you’ve been in the business long enough to know that firsthand.
Phil: Absolutely. I’ve always run this business as a long-term business rather than, just how much money can we gain straightaway. So we are comfortable waiting for that longevity of the lifetime revenue to come in.
Warren: Okay. Could you share with our audience any of the conversion rates in online bingo? Obviously, not click to sign up, because a click is not click, but from sign-up to deposit, for example, what’s the ratios that you see? And if you can’t share any click database on your target traffic, that would be helpful as well.
Phil: It’s interesting, what we’ve seen recently are somewhat I would call “odd stats,” in that we’ve got sites which simply skins of a network, so the product is no different to the last version of the product, or the skin before, or the skin before that, with some really great sign-ups and really great numbers. Conversely, we’ve had sites that run much smaller networks and have been seen a lot less, out and about, and the sign-ups are great but the conversions are dreadful, to be honest. So it really does vary. From click to sign up, we’ve seen everything from 2 to 3% to 25%. It really does very. But we also see a lot of is, it depends not only on the click but what happens after the click. So, we can run two campaigns exactly the same, same exposure, same acquisitions, they might send the same amount of traffic to both sites, one converts and one doesn’t. And that’s down to offer, down to creative, it’s down to the flow on the site once you get there. There are a lot more variables outside what we do than we can control, and to a degree that’s one of the reasons why, as a business, we prefer ad sales rather than affiliate.
Warren: Share the risk?
Phil: Yes. Absolutely. If a client says, “I’ll give you 100 pounds and you have to deliver 100 clicks to Client A,” and he converts none of them and I deliver 100 clicks to Client B and he converts half of them, how have I done my job any differently, between the two? The variable is what they’ve done not what I’ve done, so I should be paid for what I do, rather than, my success, or otherwise, being down to something that is outside of my control.
Warren: That makes perfect sense. So why do you think you’ve been able to maintain such a successful hold in the UK markets, specifically, in bingo, even with all the heavy competition that’s entered the space in, say, the last three or four years?
Phil: It’s a difficult one to answer without blowing your own trumpet, but I’ll give it a go. We were in the market early, which was fortunate for us. In fact, we actually started in the US market and expanded into the UK market. Our first version, which being in the UK, actually, we had to have a land-based directory in it, because there wasn’t any online. We sort of waited for the market to happen in front of us. We were there early.
We’ve always tried to do the right thing. We’ve always tried to build a site with quality on it, quality of product. My thinking has always been, if you build a good enough product, people will come, people will come back, people will stay and then click on ads, etc.
What I’ve managed to keep and I tried to translate to the team is an enthusiasm for the business, as well. I’m not a bingo player, but I’m enthusiastic about the online bingo industry and the online bingo market. I try to put that over to the people and I try to put that over to external people as well as the team, and that enthusiasm, hopefully, translates into a decent product online, which the site is appreciated and utilized and [they] come back. In the last year, specifically, we really tried to be innovative, tried to do different things. With the onset of things like WordPress it’s very easy to knock up a half-decent website, without any real skill. So, we’ve had a really push what we do to keep ourselves ahead of the market. Some of the works and some of it doesn’t, but were willing to give it a try just to stay ahead of the market.
Warren: Just touching on WordPress really quick, because this is a question we get very often, is that the CMS of choice for you and your operation, now?
Phil: On our main site it isn’t. WhichBingo has a CMS we had built for us, so it does exactly what we want it to do. Our free bingo game is an external piece of software, so, again, that’s a unique CMS. Within the business, we have a number of blog sites, which, yes, we do use WordPress on, because it’s easy, because it’s simple to knock something up. From our point of view, it works well as a support tool, where others, and I’m not knocking it, it’s a great piece of software, but it’s a main tool for other people. Yes and no is the answer.
Warren: Okay. So just to give our audience an idea of the size of your operation can you share your numbers in terms of unique visitors per month that your network achieves and, also, how many new depositing bingo customers are you delivering to operators?
Phil: We haven’t got specifics on that sort of stuff but I can give you some guidelines. Our free bingo game, which, as I say, has been live since 2005, we’ve got in excess of a quarter of a million people registered on that game. Now, that’s not to say they all play on the same day and, obviously, a lot of those people are not active at the moment, but that’s the size of the operation we’re talking about. Something like WhichBingo UK will probably see 30 to 35,000 uniques a month. A lot of those people will return on a regular basis, maybe not day on day or week on week. Naturally, they’re not all going to deposit and register on a new site every time they visit. So we will have areas of business where we have repeat traffic that we are not monetizing, but that’s part of the bigger picture of what we do.
Warren: Okay. And depositor volume, can you give us a range? Is it a-thousand-plus depositors a month? What would you say the neighborhood is?
Phil: Because such a large part of the business is paid-for advertising, we often don’t get stats back from clients. So our client will book an ad campaign and the simplest feedback we get is whether they book next month or not and that’s usually the best gauge of whether it worked or not.
Warren: I see. Okay. So the numbers are a bit convoluted?
Phil: It’s hard to pin it down. It’s not something that we track on a specific basis. We have a wide range of clients and a wide range of affiliate accounts as well, that we use. So, to actually collate all those together would take a month to do.
Warren: So how do you manage the business on the revenue side? Are you just looking at end-of-the-month dollars or pounds, in your case?
Phil: Yes. That tends to be the case. The first protocol is our sales. The inventory that we don’t sell, we’ll sit down and say, “Okay. Which affiliate accounts are we going to use to fill the space or use mailers?” That will be judged either by how our affiliates performed the month previously, whether they’ve gotten an offer at the moment, whether they’re on TV or whether they’re actually marketing directly to affiliates, which is something that I’m always surprised that so few affiliate managers do. From a very simple point of view, if an affiliate manager comes to me and says, “Look, we’ll give you an extra X% on your lifetime revenue for the next three months,” or “Send us 20 FTDs and we’ll send you an iPod, or something like that,” they’re motivational tools. We’ll say, “All right. We’ll use that one rather than that one.” The simplest decision is, “What was the size of the check that one sent last month? It’s obviously working. Let’s carry on.”
Warren: Okay. So, with larger brands, take Foxy or Wink Bingo, for arguments sake, are you finding them tougher to convert nowadays? They’ve been in the space a very long time, they’ve done a ton of paid media, especially in the market. You’re focusing on the UK. What are your thoughts about that? What are you seeing in terms of conversions with brands like Foxy?
Phil: I’m really pleased you asked me this question, because this is my current soapbox issue. So bear with me on this one. To explain this let’s do some very simple maths or math as you call it. These figures are used, for example purposes only, so anybody out there, don’t quote me on them. Let’s say the UK market has a million online bingo players, for argument’s sake. Let’s say a Foxy has 800,000 of those players in their database, somewhere. Compare that to a new brand that’s just launched which has a database of, let’s say, 100,000 players. If I show a Foxy Bingo ad on my page, potentially, I’ve only got 200,000 people who could click on the ad, become a new registered player and become an FTD and then we’d take some money out of it.
Compare that to the new client who’s only got 100,000, then 900,000 that’s been pooled might have a chance of clicking on that banner and becoming a player tagged to us and we get their lifetime revenue. So purely from a statistical point of view, running banners for the larger brands, on an affiliate basis, just on basic, basic statistics becomes less and less viable as a means to generate revenue. What it probably ends up doing is, I’m actually doing a CRM job for somebody like Foxy or Wink or whoever it might be, because somebody that sees the banner who’s registered to another affiliate, or whatever they’re tied to, sees the ad and goes, “Oh, I remember them. I played that for awhile. I’ll go back.” Fantastic news for the brand, for Foxy and, it comes down to pounds shillings and pence, we get no money for doing that.
I’m just putting things up in the air there but you can see that as a brands get bigger it becomes less effective for an affiliate to actually run affiliate marketing for them. Now, I’m quite happy to run [Pay Foster 24:27] for them because, in that instance, they’re paying for the CRM side of things that I’m doing, the restart I’m doing for people. The problem is, and this is almost the core of the market, affiliate managers, I would guess, to 100%, are targeted by their losses on registration and new players.
Warren: It makes perfect sense.
Phil: Did I? With the number of people. I just need to make sure everybody understands that.
Warren: I think you used a pretty simple, easy-to-understand, explanation. So thanks for that. So, do you think it’s related at all to a slowdown in the market in terms of, these big brands have a large percentage of the existing bingo market, but you see any slowdown occurring, making it more difficult to convert, even if it’s just purely related to the size of the brand and the player bases they have?
Phil: I think the situation now, as to what sites are doing now, is fighting over the share of the wallet, rather than recruiting people who’ve never played online bingo before. Again, I have no figures quote on this but I can’t believe there are that many people out there who have never played online bingo anywhere else before. There’s very few people who go, “Oh, my God, online bingo, I’ve never heard of that. I’ll go and register at Foxy or something like that.” What you more likely got are people who have registered over a range of sites. That person might only spend 100 pounds every month. So out of their pocket goes 100 pounds. Last month, they spent 25 pounds across for sites. This month they might spend 20 pounds across five sites. So, the actual size of the market or the actual money that’s in the market hasn’t expanded. Four sites have probably seen a reduction in spending by this player and one site has got a new player.
Warren: So the UK market is definitely saturated? We can use that term?
Phil: That is my guess. Having said that, one of the things we have on WhichBingo is a directory that lists every single site in the marketplace, irrelevant of whether a client of ours, or an affiliate, whatever they might be. We list absolutely everybody. This year alone, we’ve seen 50 new sites launched.
Warren: Wow.
Phil: I looked this morning and the total is 354 brands in the UK bingo market.
Warren: Okay. The idea is that the growth in the player market or new entrants who have never played online bingo does not correlate with that same percentage.
Phil: Again, if you do some basic math 350 at 50 is what? Is that six, or something like that?
Warren: Seven.
Phil: Yes, or seven. I don’t think the market is expanding that size. So, again, basic math tells you it has to be people arguing over the same pound.
Warren: Definitely, okay. So, Phil, who are some of your competitors, that you highly respect, and why?
Phil: We have a number of competitors who, I have to say, all do a really great job in the market. Let me name a few of them and say hi to them.
BingoPort is probably our biggest competitor and Scott and the team have done a great job there. They drive huge amounts of traffic and do a really good job.
Bingo Base was one of the early sites out there with us. They continue to do well in the market.
BallsUpBingo with people like Nickie Shute who’s a great writer on everything online bingo and knows exactly what she’s talking about and probably out of the whole market is a person who knows the market best because she is a bingo player.
You’ve got people like FreeBingoHunter who are fairly new to the market and have done an excellent job with a really well designed site.
Bingo Hideout does a really good job and got a name check the guys at Sunlight Bingo and Mad About Bingo… the Edwards boys. How they get into positions they get on Google, I do not know but I wish I was on some of the places that they were.
Then you’ve got Chris at Little Star who does Super Free Bingo, again, been in the market a long time and does a very good job. On the one hand, I wish they weren’t there, because they make our job a lot more difficult, but the majority are really good guys. That’s one of the good things about the online bingo market in the UK, not all of the UK, there are some good guys out there. There’s the odd person who isn’t as good as the others, but they’re all good people, and they all the good stuff.
Warren: I know some of those guys as well and they are definitely some great players in the space. The last question for you Phil. You’ve won many awards during her years in this business. Which one are you most proud of and why?
Phil: Great timing and the question of Warren because last week we were down in London at the EGR Awards and we won the award for Gaming Review Site of the Year. So, that’s across the whole of the online gaming market. My team and me have done some really great stuff this year it was fantastic for them to get the recognition for the hard work they’ve done. There were 700-plus people at the awards ceremony and we are really, really pleased about that award. We were really chuffed about that.
Warren: Congratulations. That’s a big honor.
Phil: Thank you.
Warren: Well, very nice. We’re just about out of time and, Phil, I really want to thank you for offering your insight with our audience today. It’s definitely good to talk to someone who’s been in the bingo space as long as you have. There’s not many out there, as we all know. If anyone is interested in contacting Phil at the end of this interview, please send an email to interviews@casinoaffiliateprograms.com and we’ll be more than happy to put you in touch. Thanks for watching and stay tuned for future interviews with iGaming industry leaders. Take care.
Phil: Thanks a lot.