It's also a huge passion of Dan Morrison's, who founded ConversionBet in May 2017 to focus heavily on personalisation and player acquisition. The ConversionBet CEO is confident his company stands out in the market and has produced the projections to match it.
Recently, Morrison also brought affiliate expert Vadim Fedotov on board as CMO, to help the firm into the next phase of its journey. Below, the two speak exclusively to Gambling Insider, touching on their journeys so far and what makes ConversionBet so different.
Dan, you founded ConversionBet in May 2017; what drew you to the area of player behaviour and how would you describe the journey so far?
DM: I had always worked in the affiliate industry, based in Malta, since 2008. Being that affiliate manager attracting traffic to the operator, there were always different failures I understood. Through many, many years of finding out these huge gaps in the affiliate market, I undertook my first venture, which I’m still running now: ConversionBet. This was delivering a product to the industry that could officially fill those traffic leaks on operator sites. I started by talking to tier-one operators and asking them how their conversation rate is going.
If they said it was good I would ask whether that’s post-CRM. If it was, it meant they have a fantastic CRM team. But what’s happening pre-CRM? When I started to get results such as 80% peel-off rate, with only 20% of affiliate traffic registering, that was 80% media burn. When I looked at how much money was being wasted paying for good traffic without understanding why the customer came to the site in the first place and no one giving them a reason to come back, I saw a clear space for ConversionBet to sit as a bridge between the affiliate and the operator.
What exact figures are you projecting over the next year?
DM: Although we’ve been incorporated since May 2017, we still had to spend six months building the product before invoicing our first client at the end of October. From then until the first company year, we invoiced £120,000 (over six months). This financial year, we are on for £350,000. For the end of 2019, we’re on for £853,000 and, by the end of 2020, we’re on for £1.7m. That is reoccurring revenue. The way the business model works is it’s a fixed-cost model, which is shared between all marketing departments, because each and every single operator works in different markets.
Each market has its own budget so, if you have a fixed cost in the middle, each market dealing with that budget shares that cost so it means each market gets a very fair deal. They’re all 24-month contracts, which means we get reoccurring revenue 24 times once a customer is in place. In terms of the business value, we step away from the 2-3 times multiplier. Because it’s a fixed contract, we hit nearly 8-10 times on a multiplier if any investors are looking in or any exit strategies are implemented.
Vadim, how will your previous industry experience help ConversionBet and what are your personal aims with the company?
VF: I’ve been in the online affiliate gaming industry for 11 years already. Me and Dan came to know each other three years ago at SiGMA. We were friends at first, then the company approached me and I understood the whole business model front to back. I did used to work for Betsson and other operators so I understand the industry. I liked the model from the get go. Right now, I have my own affiliate network and digital marketing agency, so it wasn’t a direct connection from the beginning, but we continued our conversations and we sat down in Amsterdam for a pretty long meeting in July.
We had our time off in summer and then I reached back out to ConversionBet. My plan was I can get them a lot of immediate clients. Since I came on, we’ve already signed on seven brands. Because I send quite decent amounts of traffic to these people, I have a bit of sway with them, you might say. So I knew I could bring a very healthy client base to the business right away. Secondly, my goal ultimately is I want to see how we can apply this tool to my traffic. So I want to see where we can increase conversion from affiliates to operators, which you can call AffiliateConversionBet!
The company did well without me and we’re planning on even more. We do need more resources so that there’s a proper technical pipeline, as we can’t just take on 25 new clients in one go. In the first quarter of next year, we’ll be looking at at least 10 more from my side, so the figures Dan told you earlier are very moderately calculated and more than achievable.
There’s a lot of emphasis on personalisation being the next big step in gambling innovation – what makes your personalisation tools different?
DM: When people come to the site, we create what we call a Player Fingerprint. So every single person who comes to the operator site that we’re plugging into, that Player Fingerprint learns things such as cookie information, the device and location of the player from their session. When we learn that, we can start educating the customer once they try and leave. If they look at certain slots, we build a profile on that customer. We can then start identifying if they are a high-volatile slot player, a blackjack player, a roulette fan, a Big Time Gaming fan, a NetEnt fan. Once we start learning that particular profile and they try and leave, we can use that information and data to market to them. It’s the end of generic marketing, such as 50 free spins to everyone. One, that’s very margin eroding and, two, people might not be interested in free spins; they might rather learn about the casino and understand why they’re there – giving them a reason to really get involved.
What a lot of casinos do these days is try to buy the market. By getting traffic and having great welcome offers, what we see more and more is players use up the welcome bonus, lose their first deposit and the operator never sees them again. However, if they are educated on every step of that acquisition funnel by us, they are no longer a number and they become an advocate.
VF: Like Dan said, ConversionBet finds the reason a person came to a website. Me as an affiliate, I have a lot of sources of traffic under my affiliate network, whether it’s SMS, SEO, cloaking, influencer traffic or ads. Outside of SEO, where it’s often clear why a customer came to a site, we position ConversionBet to keep them on the site and then convert them as well, despite not knowing why they arrived. It’s affiliation that plugs into the operator and maximises all their visitors into paying leads.
The full interview with Morrison and Fedotov will appear in the December edition of Trafficology. Register here for free access.
