#51: Is It Time To Stop Offering Bonuses?

When was the last time you saw an online casino or sportsbook that didn't scream about their welcome bonus?

It's nearly impossible to find one. The industry has fallen into a dangerous spiral of bonus one-upmanship that I believe is costing us dearly.

What started as modest 100% matched deposit has ballooned into monsters worth $1,000, $2,000, even $3,000 in some markets (hey crypto casinos).

Before you know it, everyone's throwing absurd amounts of money at customers who often have no intention of sticking around once the bonus dries up.

The psychology here is simple but devastating. When players start comparing operators solely based on bonus size, everything else about your brand becomes irrelevant. Your amazing UX? Your lightning-fast withdrawals? Your innovative features? None of it matters when the conversation starts and ends with "who's giving me the most free cash?"

So today, buckle up. Because I’m going to explain why I think you should ditch the bonus… and more importantly, what you should do instead. 

The Hidden Costs of Bonus Addiction

Let's get real about what these monster bonuses are actually doing to our businesses. Because it's not just about the immediate cash outlay. The damage goes much deeper.

First, the economics are brutal. Every dollar you give as a bonus is a direct hit to your GGR. For a start you have bonus abusers, and those people alone eat into your margin.

But even without outright exploitation, the ROI on bonuses has been tanking for years. The truth? The players attracted by massive upfront incentives are often the least valuable. 

These bonus hunters have no loyalty. They jump from promo to promo like digital nomads, never settling down with a single brand. They inflate your acquisition numbers but contribute little to long-term revenue.

The psychological impact is even more insidious. Large first-deposit bonuses create what psychologists call the "overjustification effect", when external rewards reduce intrinsic motivation. In simple terms, the player's focus shifts from enjoying your product to chasing the next handout.

They're not playing because they love your casino… they're playing because you paid them to.

This conditions them to become deal-seekers rather than loyal customers. Once the bonus is gone, so is their reason to stick around. You've trained them to ask "what can I get for free?" instead of "where do I enjoy playing?"

From a branding perspective, relying on bonuses positions you as a commodity. If your main selling point is "free money," you're telling the world that your actual product isn't worth paying for. It's like a restaurant that can only attract customers with two-for-one coupons… not exactly a sign of culinary excellence.

The hard truth? When a player only comes for the bonus, they never develop an appreciation for what makes your platform special. And maybe you’re not special, because money you budget for bonuses could just be invested in a killer product.

The Four Pillars of No-Bonus Success

If not bonuses, then what? This is where most operators hit a mental roadblock. They've been so conditioned to think that bonuses are the only way to compete that they can't imagine an alternative. But I truly believe there's another path… one that's actually more profitable in the long run.

Let me break down the four pillars that can replace bonuses to build a stronger, more loyal player base.

First, brand equity…

Build something people actually want to be associated with. This means creating a brand that stands for something meaningful beyond free money. Maybe it's your commitment to responsible gaming, your distinctive personality and voice, your stunning design aesthetic, or your community-building initiatives.

Strong brands resonate emotionally with players, creating connections that transcend transactions. Your message could emphasise fairness, entertainment value, community, or innovation. When players feel proud to be associated with your brand, when they'd wear your t-shirt or recommend you to friends, you've created something far more valuable than any bonus could buy.

Second, product excellence…

Your platform should be so good that people want to use it regardless of incentives. Forget cookie-cutter white-label solutions, which are indistinguishable from your competitor, except for a slightly different colour palette.

Invested in a massive game selection, better payment solutions, and a slick interface that makes betting enjoyable. The product itself becomes the reason to sign up, not a temporary cash infusion.

Third, user experience and service…

This is where so many operators drop the ball. Fast withdrawals, responsive support, intuitive navigation, these things matter far more than a one-time bonus.

When a player can withdraw in minutes instead of days, or gets help immediately when needed, they form a much stronger connection to your brand than any bonus could create.

Fourth, progressive loyalty programs…

Instead of front-loading value, reward players continuously over time. Some operators do this brilliantly with their rakeback system. Every player gets a percentage back on every bet. Also more common are attractive VIP tiers, and regular rewards that give players reasons to stay, not just reasons to join.

Together, these pillars create sustainable competitive advantages that can't be easily copied. Any operator can match your bonus offer tomorrow, but they can't instantly replicate your brand trust, product quality, or loyalty infrastructure.

What's most fascinating is who these strategies attract. When you stop leading with bonuses, you naturally filter for higher-quality players, ones who care about the experience, not just the freebie. These players deposit more frequently, stick around longer, and engage more genuinely with your product. They become fans, not just customers.

Your Implementation Strategy

I'm not suggesting you switch off bonuses overnight… that would be reckless. But there's a methodical way to test whether this approach could work for your business.

Start with market research…

Figure out what bonuses exist in your target markets and how competitive yours is by comparison. Are you the one launching these bonus wars, or just keeping pace? Look at your closest competitors by market share and see what they're doing. Then check if anyone in your market has already broken the pattern. Is it a respected operator or just some random hillbilly trying new things?

Next, run some A/B tests…

If your platform allows it, create control groups where some new users get your standard bonus while others get an alternative proposition. Maybe it's "no bonus, but better odds" or "smaller bonus with better loyalty rewards." Track the differences in behaviour: initial deposit size, yes, but more importantly, 30-day retention, 90-day value, and overall ROI.

If direct A/B testing isn't feasible, try a geographical approach. Test your no-bonus strategy in a smaller market first. Australia did this involuntarily when regulators banned sign-up bonuses altogether, and guess what? Betting companies still managed to acquire and retain customers.

The messaging is crucial. Don't just remove the bonus; replace it with something better. Be transparent: "We don't offer upfront bonuses because we'd rather give you value everywhere else." Highlight your fast withdrawals, exclusive games, superior odds… whatever makes you genuinely better.

You'll face internal resistance, for sure. But this is where your data comes in. Show them the lifetime value, not just the day-one metrics.

The iGaming industry has been stuck in a bonus arms race for too long. So I believe it's time to forge a smarter path. One that builds sustainable relationships instead of training players to chase the next handout.