NOTE: New York Sports Day’s parent company, Catena Media, has sports betting affiliate marketing arrangements with operators.
New York’s sports betting market has rapidly grown into the largest in the United States. The cost of doing business is high, but sportsbooks have relied on affiliates to assist in acquiring customers.
A recent decision by the New York State Gaming Commission imposes restrictions on those affiliates. However, that decision does not shut down their ability to do business.
Based on rhetoric from regulators, sports betting affiliate marketers were fearful that they may be eliminated entirely in New York. Instead, the NYSGC imposed a few restrictions on affiliates, but allowed them to maintain working relationships with sports betting operators.
New York action inspired by Massachusetts
Neighboring state Massachusetts has been diligent in careful oversight of affiliate marketers in its state. The Massachusetts Gaming Commission prohibited affiliate marketing companies from being paid on a revenue share basis. The MGC also eliminated the use of terms such as “risk-free” when referring to sports betting.
Following the lead of Massachusetts, NYSGC chair Brian O’Dwyer has spearheaded New York’s efforts to regulate affiliates. The goal? To protect consumers and eliminate confusion in the New York sports betting market.
False or deceptive statements prohibited
The NYSGC ruled that affiliates must disclose that they have affiliate arrangements and must not be misleading. The organization also limited the messaging that can be used to consumers.
The NYSHC ruled that New York sports betting affiliate marketers cannot use language that may be “false, deceptive, or misleading” in its content or advertisements. For example, claiming that a bet is “free of risk” or has some sort of “guarantee.”
Often, NY sportsbook bonuses give out bet credits in the amount of a customer’s first wager if it loses. A sportsbook or its affiliate must explain that promotional money is required to be played and may not be withdrawn as winnings until the customer does so a certain number of times, says the New York regulatory body.
Lastly, the NYSGC passed language which cracks down on the publication of content that urges consumers to re-invest more money following failed bets. This is commonly known as “chasing losses” in the industry.
NYSGC’s efforts aim to curb problem gambling
Through much of its efforts, it’s clear the NYSGC wishes to protect citizens in New York from potential marketing tactics that could lead to problem gambling. Affiliates can deliver many customers to sports betting operators, and be paid handsomely for it.
O’Dwyer stated the commission could revisit sanctions on affiliates if it finds tactics used by the companies lead to addiction. New York could even bar affiliates from operating, O’Dwyer warns.
“If I find that within the next six months to a year that there have been significant problems with the type of advertising that’s coming down I will come back to the staff, [and] to my fellow Commissioners and ask that we revisit that rule and prohibit third-party advertising,” O’Dwyer said.
Yet, the NYSGC did not explain what methods it could use to determine if affiliate marketing strategies were increasing instances of gambling addiction.
An affiliate marketer is defined as an “entity or person who promotes, refers potential customers to, or conducts advertising, marketing or branding on behalf of, or to the benefit of, a casino sports wagering licensee or sports pool vendor pursuant to an agreement with such licensee or vendor.”