On 13 September, the Advertising Standards Authority (ASA) published four rulings for breaches of the CAP Code. All four were in respect of “advertorials” which marketed the services of different gambling operators – Bonne Terre Ltd (trading as Sky Vegas), Ladbrokes Betting & Gaming Ltd, 888 UK Ltd and Casumo Services Ltd – and were created and published by an affiliate marketer. Despite coming in the wake of SkyBet announcing that it is closing its UK-facing affiliate marketing scheme, and increased pressure from the Gambling Commission for licensees to be accountable for their affiliates actions, various operators have reportedly re-affirmed their commitment to affiliate marketing.

The advertorials

The adverts were shown on www.uk.24hournews.co.uk (in the case of Sky Vegas), www.24hourlynews.co.uk (in the case of Ladbrokes) and www.casinohacks.co.uk (in the case of 888 and Casumo) and had the appearance of editorial articles. They were all in the style of news articles reporting on an individual’s gambling success. They included text such as “…William is also over £130,000 in debt after having to sell the house and continue to pay out of pocket for his wife’s cancer related medical bills their insurance WOULDN’T cover …William took to Facebook one night in the hospital lobby to update his friends and family on his wife’s health”. Each went on to explain how “a little tired and admittedly a bit depressed”, William “stumbled upon” promotions offered by the respective operators. Banners at the bottom of each advertorial advertised a promotion run by one of the gambling operators.

The ASA received complaints in respect of all adverts as to whether they were irresponsible for suggesting that gambling could provide an escape from depression and was a solution to financial concerns. The regulator found that the ads were socially irresponsible by targeting vulnerable people by identifying personal difficulties, such as selling property to pay medical bills and coping with cancer. The ASA held that they were consequently in breach CAP Code rules 16.1 and 16.3.

The ASA also challenged whether the ads were obviously identifiable as such and made clear their commercial intent. The regulator noted that the ads gave the impression that they were news articles reporting on William’s story and that this was supported by the inclusion of the phrase “our own Daily News reporter”, the editorial style of the narrative and the inclusion of ‘reader’ comments at the bottom of the article. Although throughout the article banner ads were visible which contained the applicable operator’s logo and promotion, the ASA gave little weight to this as they considered that genuine news articles also often contained similar ads and therefore their inclusion did not make the commercial intent clear. The regulator consequently held that the ads were in breach of rules 2.1 and 2.3 of the CAP Code.

Affiliate marketing under pressure

In all four cases, the affiliate had acted contrary to the terms of its engagement with the gambling operator. All claimed that they had not commissioned the advert, nor had they cleared its publication. Further, they cited the contractual and practical measures they took to prevent this type of issue arising, which included not only contractually requiring affiliates to obtain approvals for this sort of ad, but also providing training to employees and updates to affiliates of their obligations, and using software to monitor compliance. In the case of 888, the operator subsequently terminated its engagement of the affiliate as a result. Despite this, the ASA emphasised that the operators were responsible for the ads as the beneficiaries of the marketing.

As Law-Now reported earlier this month, on 4 September SkyBet announced that it is to close down its UK-facing affiliate marketing programme. This announcement came amidst increasing regulatory pressure on the remote gambling industry and the sector’s use of affiliates. Shortly afterwards, Paddy Power Betfair announced a “one strike policy” whereby a single breach of internal policy by an affiliate will result in its engagement being suspended. With this latest string of ASA rulings, it might not be surprising to find other operators following suit, or looking at closing their programmes altogether.

There are, however, reportedly a number of operators that have since reaffirmed their affiliate marketing programmes. These operators have, however, also taken the opportunity to warn their partners of the implications of non-compliance and the rules and regulations with which they must comply. Meanwhile a group of leading affiliates have also reportedly established a new body - the International Gaming Affiliate Association (iGAA) – in response to the increased regulatory scrutiny, which aims to create a code of practice to ensure affiliates are promoting gambling responsibly and in accordance with regulations. Such steps suggest that there is still life left in the affiliate marketing space and a chance that reform within the industry could mean such schemes continue to thrive.

The full rulings for Sky Vegas, Ladbrokes, 888 and Casumo can be accessed here.