How Affiliate Programs Hurt Consumers

July 31, 2025 Business Theory Complaints
How Affiliate Programs Hurt Consumers

Affiliate programs and gambling have gone hand in hand for at least the last 20 years– mostly out of necessity due to the vertical being essentially untouchable by traditional ad networks (not to mention payment processors). Casinos offer 3rd party affiliates huge bonuses for signups and/or lifetime commissions based on a user's deposits and losses, because why not? The margins of online gaming are absolutely insane, so there is way more leeway in having a higher SG&A budget. The problem arises as essentially the principle-agent relationship– the affiliate may not be presenting the best offers to the consumer, as the best offers may not be the most lucrative for the affiliate's earnings.

Search Engines

Google is one of the world's largest advertising companies in the world. They happen to run a search engine. Their core product involves showing advertisements to consumers who are actively searching for a specific product or service. They provide "free" organic results, albeit placed below the ever growing assortment of paid results. Combine this with statistics such as 42% of people saying Google search is becoming less useful, and you can begin to ask yourself "why would Google show useful results for free, when they can make more money by forcing more businesses to pay for visibility?" The affiliate (or publisher, ad network, etc.) will typically end up only including or promoting the results or deals that are most favorable to their own bottom line.

The Lifecycle of "Consumer Oriented" Companies (e.g. enshittification)

The Points Guy – This travel oriented site started out great. A site focused on how to maximize credit card rewards. The founder focused on the actual best deals for travel, and monetized via affiliate commissions. Within 2 years the site was profitable enough to be sold to Bankrate and eventually Red Ventures, a digital performance marketing company. The focus now is primarily shilling whichever credit card has the highest conversion rate and commission rate for the site's owners, even if they aren't the best for consumers.

Enshittification

Yelp – Everyone knows Yelp. They are focused on restaurant and B2C reviews and were initially a trusted, objective source for included businesses. Yelp themselves, though, have evolved into extortion artists. Just like TrustPilot, GlassDoor and The BBB, if you pay, you get to moderate the reviews, to a degree.

OddsJam – OddsJam has been the defacto arbitrage platform for sports bettors wanting to have a positive ROI over the past 2-3 years. Gambling.com Group acquires OddsJam for $80-160 million. As Gambling.com Group has relationships with essentially every US and EU casino company, there isn't an immediately obvious conclusion to jump to. Do they start promoting different sports books based on quotas or whichever has the most favorable terms for themselves as affiliates?

The Takeaways

The inaugural post on Oddize's Backstretch Blog hopefully doesn't come away as just trashing a potential competitor, rather speculating on incentives. Since OddsJam's acquisition, at least half a dozen new odds board clone sites have popped up on Reddit alone. There isn't anything inherently special about an odds shopping aggregation site. When building Oddize, one of the potential monetization methods considered was sportsbook referrals, and it is tempting to go the easy route. Offer the product for free, but then the consumer ends up being the product to be monetized. The goal of Oddize is to educate and inform bettors, a byproduct of which may be antagonistic towards sportsbooks, who themselves can tend to be kind of predatory.


Share: Bluesky Facebook