Over the last few years a very disturbing trend has emerged in the online poker world. It’s disturbing because it costs a lot of money and there is no way to measure its success.
The trend is player sponsorships; when an online poker site contracts with a player to wear their gear in exchange for a salary, rakeback, or buy-ins to online or live events. How each room structures their deals tends to be a closely guarded secret but they all tend to involve one or a combination of those compensation packages.
The reason it’s disturbing is that outside of a few big poker names I have yet to see a single measure of how effective sponsorships are. Sure, Phil Ivey or Chris Moneymaker have name value but what about Joe Sixpack who has been on a hot streak winning a few tournaments and killing some middle stake games?
The classic argument in favor of doing no-name sponsorship deals is that these players are big in a specific community. But do you really think anybody specifically plays on a certain site because some B or C level pro is playing there?
Experienced poker players – those who would actually know the name of some obscure player – play where the best deals and the best liquidity are. That’s a fact that smacks a lot of poker rooms in the face. Go look on any message board in any language, and show me one post where someone says they play on a specific site because some B or C level pro plays there. It simply doesn’t happen.
Like I said, Phil Ivey or Chris Ferguson or Chris Moneymaker or any other of big name pro will get the fish coming. Run some television ads featuring someone they’ve seen play on whatever poker show they happen to watch and fish will type in fulltiltpoker.com or pokerstars.com because they figure if these top guys are endorsing it, it must be legit.
The sponsorship model has worked well for Full Tilt because they basically cornered the market on some of the biggest names in poker. It also worked reasonably well for PokerStars because they were able to sign several WSOP winners back to back.
But what about Joe Sixpack, the a C or D level poker pro who nobody outside a few hundred hard-core players might know? You can’t put him in any advertising campaigns because nobody outside a specific community of hard-core players knows who he is. What fish is going to sign up because someone they’ve never heard of endorses a specific poker room? Great, he won a $3000 buy-in event last year; so what? Somebody had to win. It just happened to be him.
I mean, when someone like myself who works in the industry, reads every major poker news site, and lives this business says, “Who is that guy? Never heard of him before,” when I read about some site’s press release about the latest addition to their team of pros how exactly are you supposed to monetize that relationship? You can’t.
But because it worked for Tilt and it worked for Stars everyone’s doing it. Even sites that don’t officially have a pro team pay off players to play wearing their gear. I remember being sent one proposal to sponsor a player and the guy was a net losing player (I checked his W/L stats on our site)! He wouldn’t even be able to afford to play poker if he wasn’t finding chumps willing to sponsor him into events.
Now the reason I called this concerning is because guess where that money would have come from if I would have said yes to the sponsorship request? Out of my marketing budget. Money I could be using to actually sign up new players (fish) or giving back to players via bonuses, freerolls, or other promotions.
While the amounts spent on sponsorships at most sites might seem trivial compared to overall revenue of a company it’s a completely unnecessary expense. For the most part the sites are simply setting money on fire.
And it’s not just the money that they’re giving to the player but there’s a territory manager who now has to travel to all the events this person plays in and try to butter up the local poker media (if there is any) to get some sort of mention so he can go send the article to everyone in the company proclaiming the great success of his team of sponsored players in garnering press coverage for the poker room.
The other disturbing part about it is that there is no objective way to measure results. At Full Tilt they know exactly how many more signups come from an ad featuring FTP Pro A and FTP Pro B in their banner ads. They also know what which commercials, featuring which pros result in the most signups. But how do you measure the value of Joe Sixpack bubbling in a no-name, untelevised event?
Some rooms try to justify the cost by stipulating that the sponsored player must also post on a blog or perform some other promotional services but is that good value for the money? If some room is dumping $50K or $100K per year into each of their “pros” couldn’t they find a better way to attract customers? They could just hire some bloggers for a fraction of that.
I have been going back and forth over whether or not to post specific examples with player names and such but in the end I decided against it because it’s really not fair to blame the players. They’re simply taking advantage of the poker room’s lack of creativity. Hell, if someone wants to pay my way into a bunch of events or pay me to play on their site I would do it in a heartbeat. Hell, I’ll even wear your gear when I play online so I can give off the promotional vibe that other players at my table will be able to feel telekinetically.
I also have to steer clear of naming the rooms as well because in many cases naming the room would immediately expose the player(s). I can use Stars and Tilt as examples because for the most part they’ve gotten it right. Granted, they’ve both been reaching farther and farther into the well to find players to put on their “teams” but both originally locked up high quality, high value players that could be exploited for their marketing potential.
The industry has always had a monkey-see, monkey-do attitude. From the design of their software to their marketing campaigns, online poker sites tend to just copy each other without any thought whatsoever as to whether or not it’s successful.
So next time you see some no-name player being touted by your favorite online poker room, remember, you’re helping pay that guy’s package via the money that isn’t going back into bringing in more fish or put back into promotions/bonuses.
Photocred to JOE M500