The word "player value" seems to be a big buzz lately in the industry, especially when discussing CPA.  With the great deal of uncertainty in the poker affiliate industry, many affiliates as of lately including myself have opted to look more favorably at CPA versus MGR.

Until this year I have always favored revenue sharing models as I felt it created more of a partnership between the affiliates and the rooms.  And quite frankly, I still feel this way.  However with the recent turn of events I have shifted my paradigms.  The amount of income myself and many of my affiliate friends lost when rooms like Party and Paradise pulled out was substantial enough to make me question the longevity of ANY room in the industry.

So with many affiliates thinking along these same lines, we have to look much closer at our overall player values.  There are two types of player value:

1. Individual Player Value - This is how much an individual player is worth in terms of profit to the room.  For example, let's say over the lifetime of one players action at an individual poker site they raked $500.  Now let's say the room paid an initial $200 CPA. That players  gross value could be equated to $300.  Keep in mind there are several other factors, FPP points, bonuses, processing fees,  ect. that would determine their final net value.  This is just the simple explanation to give a general idea of what player value is.

2.  Overall Player Value - This is a much more important figure and the one that affiliate managers will look at very close when determining what type of CPA to offer you.  Your overall player value in poker can be equated by looking at the total revenue in rake from your entire player database over the lifetime of the account, less the various fees and bonuses listed above, also less the initial CPA's you have been paid.  Then divide the amount of players by this number and this will give you a rough estimate of your current overall player value at that room.

Player value and CPA's go hand in hand.  Many affiliates like to say "It is only our job to send the players to the rooms, it is their job to convert and retain them.  Well, not so fast.  Having a "them and us" mentality is a one way ticket back to $50 CPA's.  We are supposed to be partners, right?  Sure if you are on a $10 CPA, this is a great thought process.  However when rooms are willing to assume the risk and pay us upwards of $100+ per player, even after our players have only raked maybe $10 to meet the minimum requirement, this attitude sucks.  If we are looking to have a long term relationship with the rooms and have our CPA's increased, then we need to show long term value.

The responsibility does fall on the rooms to convert and retain, there is no doubt about this.  Yet, when we ring 10 of our buddies and say "Hey deposit $50 at this poker site and play .25 - .50 until you have raked around 100 hands and I'll give you your $50 back"; This does not equate to partnering or long term value in any sense.  You may be laughing, but surprisingly this is not an uncommon occurrence in this industry when dealing with CPA's.

I still believe in revenue sharing plans and I think they can actually make you a heap more more money long term. Likewise revenue share plans help you to form a solid residual income.  However for U.S. based affiliates there are other risks involved than just having the room pull out of the market and losing your players.  Essentially you are collecting a % of the rake with the room, (a.k.a. revenue sharing).  I am not an attorney or legal expert though so I will save that discussion for another time.