Monday, August 08, 2022

Asian affiliate acquisitions hot up


The recent moves in the Asian affiliate space, including high-profile acquisitions and talk from some of the larger listed affiliates of entering new markets in Asia, might have observers believing the region is like any other, at least as far as affiliates go.

However, this would be too simplistic a view given the huge cultural differences and the shape of the Asian marketplace.

For obvious reasons, Asia is viewed as a huge opportunity for many affiliate organisations based in Europe. An enormous population across the content with a proven appetite to gamble is too big an opportunity to ignore. Throw in the limited scope grey market operators have to actually reach their audience, and it makes the case for affiliation all that much stronger.

No wonder then that during the recent results earnings calls with the largest-listed affiliates, efforts towards extending their operations into new markets in Asia were much in evidence.

Catena Media, for instance, said that it would be augmenting its existing presence in Japan with the launch of its AskGamblers site in the country and that it had launched sports sites there as well. The company said its casino products has grown well in the second quarter.

Then came the news at the end of August that Raketech, which until now has been a predominantly Nordic-facing affiliate, had bought the Japan-facing Casumba for an initial EUR2 million.

Affiliates very much follow the money, so it is worthy of note that Michael Holmberg, chief executive at the company, said he is seeing “many operators looking at Japan and this acquisition is an opportunity for Raketech to be part in an emerging market where our customers want to grow.”

What is clear from the deal - even more so than with other acquisitions in the affiliate space – is that the knowledge gained from the team which is selling Casumba will be vital to Raketech’s success in Japan and anywhere else in Asia the company wishes to target.

Another company making a noise about Asia is Stockholm-based Casinoble which said recently that its traffic from Asia had risen significantly off the back of “technological progress and trend shifts in the way of gambling.”

Specifically, spokesperson Viola Lukas points out that when it comes to Japan the gambling consumer works in a very different way to Scandinavians. “Japanese gamblers do research and compare, Scandinavians just click on something new that looks fun,” she says.

Yet adjusting to the cultural habits of gamblers in Asia could be the least of the issues faced by affiliates looking to leverage their way into the Asian scene. So says Jonathan Casuncad from 88 Interactive who points out that the region’s reputation as the ‘wild east of gaming’ is well-deserved, particularly when it comes to the activities of the affiliates already working in the space.

“Affiliates openly target brand names of operators they work with,” he says. “In some cases where there are big sporting events such as the World Cup, I've known of operator websites and affiliate websites getting DDoS attacked to prevent them from taking bets.”

The bear pit

The worst examples of this type of behaviour, Casuncad alleges, are in China where he says that “affiliates are kings as they control online traffic.” “The Asian affiliate scene is not for the weak of heart,” he adds.

“Affiliates who are locals to those territories have more leverage over operators since they know the market more and are more knowledgeable with nuances their country has,” he says.

However, sizeable as it is China isn’t the whole Asian market and Casuncad does give credence to the theory the strategy of the Europeans in other markets such as Japan might have more chance of bearing fruit.

“The rest of the Asian territories seem practically equal in terms of potential from an affiliate perspective in terms of traffic generation, player acquisition and revenue potential,” he says.

Lukas says Casinoble is looking at territories such as Indonesia, Bangladesh and Thailand as future points of access but Casuncad makes an interesting observation about the new product vertical of esports which he says is “quickly gaining momentum in the affiliate space.” 

“Since Asia has always been more attuned to these types of games, operators as now taking notice of the potential of esports and I see more and more operators offering esports as a product,” he suggests.

“With more esports offers, comes more current affiliates targeting that space and more new affiliates who are previously only involved in esports/mobile games/etc. starting to pivot into driving their esports traffic into the iGaming space, creating a new revenue channel for themselves.”

 

Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.

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