What is cashback and how is it implemented in online casinos?

Promotions have been the primary component helping online casinos achieve success in the world of iGaming. Within the first few years of their launch, online casinos had already demonstrated that they had the potential to become the new sheriff in town. However, even those who were waxing lyrical about their potential as early as the 1990s were probably taken aback by how dominant they became in little over a decade and a half.

It would be reductive and inaccurate to state that casinos have reached these heights purely because of the quality of their promotions. They’re only one element. Cashback is also just one element of a marketing strategy, so although it has become a prevalent factor and holds importance, it’s also essential to explore it collectively as part of a bigger, broader stride forward that the industry has taken over the last 20 years.

Cashback casino bonuses and why they work

Cashback is a straightforward concept in casino gaming, returning a percentage of a player’s losses over a particular period. So, for example, if you lose $100 when using a 15% cashback bonus, you will receive $15 back as either on-site credits, free spins or withdrawable funds, although the latter option is rare.

Sites will usually look to keep you on their site, so the bonus will ensure the credits are site-specific. That’s not always the case, but it’s seldom that you’ll find otherwise, and those cashback casino bonuses that allow you the flexibility to use your cashback on a multitude of games or to withdraw it often stand out in a sea of promotions. This is why it is essential to understand the criteria that experts use when rating the quality of a casino cashback bonus.

Ultimately, the reason they work as a bonus is because of their simplicity. It’s like racking up points as part of a credit card reward system, where you might be incentivised to spend on your card when you travel, and in turn, receive some form of remuneration, discount or loyalty points to a particular brand; the more you spend using their platform, the more they want to keep you on board.

Now, obviously, this raises moral concerns for casinos, as they want to ensure that gamers are betting within safe limits. However, cashback bonuses highlight that, unlike many other types of bonuses, the focus is on existing, repeat customers rather than acquiring as many new signups as possible.

Make sure you read the terms and conditions

As with any new service or product, we must stress the importance of making sure you read the terms and conditions in full before you sign up for a casino cashback bonus. Often, you can determine the quality of a promotion by breaking down a few key factors, which include:

• Number of available games – many cashback bonuses will be restricted to one type of game, such as poker or slots, but be wary of bonuses that only offer a bonus for one specific game.
• Low or no wagering requirements – this is another factor we see right across the world of casino gaming promotion. Anything below 30x is usually considered good in slot gaming, but from my experience, anything 10x or below is suitable if you are looking to utilise a cashback bonus. The higher the wagering requirement, the more you have to actually bet to withdraw your winnings, so again, be wary of this.
• Expiry date – this is a classic one that people often overlook. Cashback bonuses might look attractive on paper, but if you have to use them within 24 hours of signup, or in some cases, an even shorter period, then you are unlikely to extract the full potential benefit of the promotion.

Some casinos will use a specific cashback offer, while others will integrate it alongside another bonus. The most common combinations include free spins, matched deposits and cashback.

Casinos will use this as a springboard as part of their marketing campaign, and the reason they implement a combined promotion is that by providing a percentage of their losses back, it attracts new customers and helps keep them engaged while playing.

Final thoughts

Cashback is one of many concepts that online casino marketers have used over the last two decades. As is the case with other promotions, there’s a scale that cashback casino bonuses operate on, which is why it is essential to weigh up the components that constitute highly-rated promotions and those considered subpar.

Taking a look at the size of the broader gaming industry market and the fact that it’s set to grow to around $700 billion by the end of this decade, there’s going to be no relenting from casino gaming companies as they look to cover every single potential angle that could bring in new customers.

Successfully implementing cashback casino bonuses requires two fundamental factors: maintaining the original design of a cashback promotion, and ensuring it aligns with consumer demand. As long as casinos continue offering this, they’ll be a key part of the industry for years to come. While the interfaces may change, such as the shift from online websites to mobile apps, cashback bonuses will remain a prevalent part, and it’s hard to envisage otherwise.