With loyalty rewards under attack, will igaming roll with the punches?

We’ve seen some major shifts in the world of online gambling in recent years. Relentless regulatory shifts, particularly when it comes to incentives, have left many licensees bewildered and players suffering as a consequence of the desire to protect the vulnerable. Historically, providers have been at the forefront in creating and pushing tools for player engagement, whether it be bonuses, free spins, tournaments, achievements or daily jackpots. Even as recently as last month, Playson boosted their free spins functionality with feature spins. That said, with the number of providers available at your average casino easily hitting 20+, using different tools for different games gets cumbersome and leads to overheads. This means it is increasingly falling upon the operators to sort out loyalty programmes across all of their providers. One programme to rule them all…

No more bonuses!

In an increasing number of jurisdictions, bonusing is being viewed as the main driver of problem gambling and thus is severely restricted or even outright banned. The Swedish legislation has been one of the most restrictive in this area, offering only the possibility to give a one-time welcome bonus to players with legislative wording which allows “no financial incentives connected to game play”. From the launch in 2019, operators have tried to get around this clause by giving cashback bonuses, loyalty programmes or free spins, but they have been swiftly and effectively shut down by the Swedish Gambling Authority (SGA) through fines and other measures. As the Covid-19 pandemic bit, Sweden tightened their restrictions even further in July, limiting welcome bonus offers to SEK100 (€10) and just recently extending the measures into 2021. Sweden is far from the only market with these kinds of limitations of course. Spain has also introduced harsher limits on bonus offers, the UK has introduced personal liability for VIP programmes, and in Belgium welcome offers have been limited to a maximum of €275.

Was it inevitable?

From one perspective, who can blame these jurisdictions? Examples where VIP management has driven customers to financial ruin, theft, fraud or even tragically to suicide are increasingly being unearthed. The suicide of Chris Bruney earlier this year or the news in October of a player defrauding his workplace of over £200k to feed his online gambling habit are just two recent examples in the UK. In both examples, the VIP bonus was depicted as a clear contributing factor, with Mr Bruney even receiving a VIP bonus hours after passing away. On the other hand, there are the vast majority of players who do not lose control of their game play. These players receive no added value for being loyal to one brand, are incentivised to sign up at more sites due to bonus and deposit limits, or simply choose to play outside the jurisdiction all together.

What can operators do?

How can brands reward players for their loyalty if rewards have been banned? In Sweden, in particular, there are examples of operators trying to reward their players with non-financial incentives which are not directly related to the game. Social media competitions (like and share) are as an example explicitly mentioned by SGA as not requiring a licence. The reason is that they do not have a cost to enter and are not related to licensed games. Free quizzes and log-in competitions (with the key caveat that they are open to all) have been tried successfully by certain operators in Sweden in 2020. However, it is important to point out that past performance by SGA does not indicate future performance, just because something has been determined as not breaking the legislation does not mean it won’t in the future. In regulated markets, operators are advertising big wins or pushing fun things like hot numbers on live casino, and big players in the UK are taking out major advertising campaigns on games, in particular Megaways. They’ve had to overhaul their marketing efforts, especially in highly targeted marketing, but they see that CPAs have increased dramatically – so operators are forced to pay much more to affiliates who in turn are having to charge more because their overall number of CPAs in the more expensive, now regulated, markets, is hurting their revenues too. The feeling is that it has all but blocked the markets for new operators who can now only get in by risking a major fine or massively overpaying for players – so they just don’t bother. In some cases, the operators have even opted to exit the market all together.

But we keep the bonuses in the other markets, right?

What about markets where bonuses are legal? Should online casinos continue pushing deposit bonuses or are there better ways of engaging your players? “Deposit and get” (bonus) or “lose and get” (cashback) are both reward systems centred on negative reinforcement (paying or losing), and more and more operators are now adding more positive reinforcement such as “play and get” or “win and get” to their mix of loyalty rewards. Calculating costs and returns becomes more complex as you move from calculating on deposits to wins, but as igaming is basically 100% maths anyway, it is surely something operators can find a way to handle. Missions, achievements, regular tournaments and quizzes are mechanics that have been implemented on increasing numbers of online brands, but still the majority lag behind. These incentives and engagement tools are here to stay and will become something players expect from an online site. The future will surely bring even more complex mechanics, some will be smash hits, while others will lose sight of what the players really want and will detract from the game. Most, if not all, operators are awake to the fact that the days are long gone when “100 free spins on Starburst” was heralded as acceptable in lieu of innovation for player retention. One thing is for sure, it is going to be exciting to see what the future brings in the world of rewards. The only other thing that’s clear is that the operators and providers who embrace innovation and alternative ways to reward players (within jurisdictional rules) will emerge victorious. Alexis Wicén is the CEO and co-founder of Unibo, a promotional and gamification software firm which delivers a full solution for casinos to create a wide range of innovative in-game and provider agnostic campaigns and promotions. He has been in the igaming industry since 2008 and was MD of casino brands at Betsson before leaving to start Unibo.