Why do bonuses require a deposit?

[ImsaKidd]

Title basically says it all: why do sites require a deposit to acquire a bonus? Also, why do some (like party) give points for depositing then withdrawing after a week?

It seems like there would be so many netteller charges that the site would have to pay for all these bonuses. It would be cheaper if they gave everyone the bonus (like the bet365 no deposit bonus).

Anyone have any insight? I just can't see how this makes sense.

[tagtastic]

I think in general these bonuses spark players that don't play regularly to "reload" their account and start playing again because of this offer.

For players who would be playing anyways, this offer may 'cause them to play a) more than they usually would to clear this bonus or b) at higher stakes, since they're forced to deposit more money.

[pzhon]

Poker sites see much less money withdrawn than deposited. On average, each dollar deposited might be wagered 10 times before a lucky/frustrated/winning player withdraws it, with the rake reducing the dollar by a few percent each time. So, poker sites assume there is some value to having a dollar deposited, perhaps $0.35.

From a winner's perspective, this may seem strange. We know our deposits will not necessarily be churned 10 times before a withdrawal. However, the bonus offers also go out many losing players who make deposit after deposit, and almost never withdraw any money. It's possible that over 75% of the money these players deposit will get converted into rake, balancing out the 0% from a currently active player who will deposit for the bonus, clear the bonus through normal play, and then withdraw the excess.

Be thankful that most poker sites do not yet distinguish between the valuable losing players and the worthless winners. However, some do, and more will in the future.

[soah]

Most people don't keep track of how much they have deposited. They may keep depositing more money on reload bonuses and not realize that they've actually lost money over the course of the year.

[SUNYGrad05]

I agree that the depostit bonus will bring more play to the site and is a good way to promote. I have always wondered though if they take a % of deposits and put them into some kind of short term high interest account where they earn money on the influx of new cash? What do you guys think about that? I would definitely do this if I was running a business this large, just keep enough cash to cover expected withdrawals + a cushion.

[TenFiftyFour]

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Be thankful that most poker sites do not yet distinguish between the valuable losing players and the worthless winners. However, some do, and more will in the future.

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I disagree with your notion that winning players are worthless for the site. Winning players contrubute rake too, and plenty of it. The difference between winning players and losing players is that winners can net enough money to cover the rake and then some.

I paid over $1000 in rake last year, I doubt that partypoker would consider me "worthless".

[ImsaKidd]

I guess I was looking at all bonuses through the eyes of a winning player. I never thought about fish needing more money, and the dposit gives it to them.

Thanks guys.

[midwestkc]

[ QUOTE ]
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Be thankful that most poker sites do not yet distinguish between the valuable losing players and the worthless winners. However, some do, and more will in the future.

[/ QUOTE ]

I disagree with your notion that winning players are worthless for the site. Winning players contrubute rake too, and plenty of it. The difference between winning players and losing players is that winners can net enough money to cover the rake and then some.

I paid over $1000 in rake last year, I doubt that partypoker would consider me "worthless".

[/ QUOTE ]

considering what some people generate in rake, they might...

[pzhon]

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I disagree with your notion that winning players are worthless for the site. Winning players contrubute rake too, and plenty of it.

[/ QUOTE ]
I've heard that argument before. It's wrong. The amount of rake you think you generate is not the same as the increase in rake due to the addition of a winning player to a site.

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I paid over $1000 in rake last year, I doubt that partypoker would consider me "worthless".

[/ QUOTE ]
Your value to Party Poker is not $1000. If they were desperate for more players to maintain a critical mass, it might be more than $1000, which is why some sites pay props 100% or more of the rake they nominally generate. Since Party has already reached critical mass, the value of a winning player may be negative.

[paperboyNC]

Even though I've paid over $4,000 in rake this month alone, I am still costing the sites I play at money.

For poker sites, players would be close enough in skill levels that in the long run, no one would make enough to cover rake.