Every year, the Financial Partners Expo forms part of the larger iGaming Super Show in Amsterdam. For the conference in June we contributed a marketing-themed article to industry publication iGaming Business' (iGB) Super Show issue. It featured insights from our forex clients GAIN Capital and ETX Capital as well as binary brand MarketsWorld. We published part one of the piece here, and the second and final part of the article is below.
In the context of these challenges, brokers are looking to streamline their marketing strategies. Roselli divides the forex sector into traditional, long-established firms like ETX Capital and newer brokers. “The more traditional broker tends to have a more diverse marketing mix,” he says.
Certain traditional brokers like ETX Capital offer both institutional and retail financial trading, further diversifying their customer acquisition and revenue streams. The broker’s institutional business and High Net Worth (HNW) division, serving private clients depositing over £250,000, complement their retail business.
Even traditional brokers without institutional or HNW businesses still tend to wield diverse marketing strategies. They leverage offline channels such as TV – Roselli cites Plus500’s campaigns on the Eurosport TV network, while ETX Capital has previously run ads on Bloomberg Television – and print ads in financial newspapers.Nonetheless, given the internet’s integral role in forex trading, online channels remain key. As Jonathan Chapman-Pemberton, Head of Affiliates at GAIN Capital, notes, “Digital marketing has always been a big focus for us and all channels play their part in the wider marketing mix. It’s important not to over-rely on any one particular channel and to strike a balance in the investment to maximise reach.”
Media buys with relevant high-traffic websites are an important digital focus. Serving traders’ need for economic news and technical analysis, major online forex media have emerged. Sites like FX Street boast the traffic to command cost per mille (CPM) impression ad deals from brokers. For ETX Capital, which runs prospecting media buy campaigns as well as programmatic retargeting, the channel “is effective for brand exposure but has low ROI in terms of customer acquisition,” according to Roselli.
The PPC channel has similar limitations. ETX Capital runs both generic and branded AdWords campaigns. However, Roselli says, “Google prices are incredibly expensive these days – it’s very hard to get customers on a reasonable CPA that allows profitability.” Among SEMrush’s list of the UK’s 20 most expensive AdWords keywords are “spreadbetting offers” (£118.03) and “open a forex account” (£112.25).
Given the investment required, PPC and media buys can be beyond the budgets of newer brokers. MarketsWorld turned to more cost-effective channels when it launched. “Early on, it was decided to grow the business slowly but steadily through the affiliate channel and organic SEO efforts,” says Saunders.
A challenge for binary and forex affiliate programmes is that they can take time to build. “Whilst this started out as a relatively slow burn, we have developed an excellent, profitable affiliate channel,” says Saunders of MarketsWorld’s six-year-old programme.
Some financial affiliate programmes expand more rapidly. Within a year of the launch of ETX Capital’s programme in 2013, it was responsible for 50% of new customers. Roselli says that today the channel drives 35% to 40% of acquisitions. He estimates that newer forex brokers with less diverse marketing mixes are seeing up to 80% of acquisitions through affiliates.
For all types of financial trading broker, the affiliate channel’s key strength is its performance-based model and cost-effectiveness. “It’s always been profitable for us, with very strong ROI,” says Roselli.
Due to regulatory restrictions, brokers like ETX Capital and GAIN Capital work with affiliates on a cost per acquisition (CPA) basis. “You can quite easily control your cost per acquisition and make sure each affiliate brings a positive return,” says Roselli. He adds that that channel also allows brokers to “measure results more effectively than other channels”.
Chapman-Pemberton, who recently launched GAIN Capital’s new affiliate programme, agrees. “As the affiliates are remunerated on a CPA model, there is an instant transparency on the channel costs,” he says. “This means we and the affiliate can quickly analyse the performance of multiple brands and products we offer, enabling quicker decisions to be made to improve performance.”
The forex affiliate space is also highly diverse. Roselli lists educators, signal providers, trading rooms and news sites as examples, in addition to brand comparison sites similar to those in the iGaming space.
This begs an important question: are iGaming affiliates promoting forex brands? With no gaming affiliates promoting ETX Capital, Roselli argues that forex and iGaming are very different products. “I see more crossover between sportsbook and casino brands and binary options,” he says.
Saunders agrees. “The rise in popularity of binary options has seen a number of affiliates from the casino and poker world get involved – there is obviously a crossover between these platforms and our own,” he says, adding that gaming affiliates nonetheless require more support than binary ones.
With binary affiliate managers increasingly working with iGaming affiliates, and forex brokers like GAIN Capital raising their investment in affiliate marketing, the outlook for the financial affiliate channel looks bullish. As Chapman-Pemberton says, “Affiliates are an important addition to the marketing mix for 2017 and will become an established channel for years to come.”
Now that you’ve read both parts of our iGB article, tell us your feedback in the comments sections. If you’d like to schedule a demo of our software solutions and marketing services, please reach out.