September saw the launch of the Social and Promotional Gaming Association (SPGA), an organisation consisting of online social and promotional platforms that currently offer sweepstakes or other promotional games in the US. According to its site, the SPGA intends to be a “unified voice for the integrity and responsibility of its members’ offerings,” providing education to stakeholders on exactly what sweepstakes gaming is and the benefits it can afford, while also pushing for responsible gaming practices in the sector.
Regulation is currently not in place for sweepstakes gaming in the US – it is why the AGA has called for a ‘crackdown’ on the vertical, which Catena Media CEO Manuel Stan described as “twofold” in its reasoning. The AGA crackdown, in his opinion, is to “clarify the distinction between sweepstakes (and the many variants) and online casinos” and to “ensure the appropriate customer protection tools are in place,” while CogniPlay Co-Founder and CEO Allan Turner suggested a misinterpretation of the market from the AGA’s perspective, making the vertical seem “dodgy” for not “following responsible gambling rules” and not “looking after players.”
Before we get started, it is important to clarify that sweepstakes are not some sort of wild west of gaming. For the most part, these draws are being carried out by reputable operators or affiliates looking to generate traffic and engage players in a new way, and because of this, failing to protect players can quickly result in a damaged reputation. Catena Media and CogniPlay, in their interviews with us earlier in this issue, made it emphatically clear that they are following regulation where it exists and are operating “in an honourable way, as though we are regulated and follow best practices” when not.
However, when regulation is not finalised, remaining legitimate as a practice often requires self-governance, holding others accountable for shortcomings while promoting good practices to others. Of course, this can lead to bad actors – the crux of the AGA’s concerns – but generally speaking, it seems reputable businesses at least are not taking this new vertical for granted.
The SPGA, therefore, seem to be acting as a legitimiser of the industry, quelling fears brought on by statements like those made by the AGA. Members will implement a range of tools typical of ‘normal’ online casinos, such as geolocation technology, age verification processes and responsible gaming tools for player safeguarding purposes, have established the legality of the games through regulatory analysis and advocate for education and awareness. Or as Turner said, operating “as though we are regulated.”
For affiliates, keeping an eye on potential regulation of the market will be key to keeping operations running safely and securely. If a state chooses to regulate, take note of the required system and apply it to any operations there, and note that such a system may be implemented in another state or territory in the future.
The sweepstakes market has shown its value and is something affiliates across the market have jumped on. And while regulation is not in place, it is the responsibility of those operating in the vertical to keep its reputation above board.
Trafficology verdict
The popularity of sweepstakes is not slowing down anytime soon. The Professional Fighters League (PFL) partnered with FanUp in September, bringing a range of sweepstakes and giveaway games to events in the Bellator Champions Series, and that is just the tip of the iceberg.
With more legitimacy through partnerships, white-label platforms like CogniPlay’s and self-governance and education initiatives like the SPGA, it is likely that authorities both in and outside of the US will need to make more permanent rulings on the state of sweepstakes soon. At present, the verdict seems to be that there are a few bad apples spoiling the bunch, but if regulation can have these businesses put in their place, who knows where this vertical could go next?