Bonus Campaigns Overview

From time to time, all brokerages must refine their marketing strategy and create trading stimulation campaigns to attract and retain their clients. They analyze the target audience, market trends, and experiences of other businesses. To figure out how brokers use bonuses to promote their services, Brokeree Solution examined more than 100 brokerages over the world to understand the variability of types, conditions, and frameworks of promotions.

According to the research, more than 57% of brokers offer bonus programmes to their clients for different purposes. What are these programmes? How do their conditions differ? What are the goals of these activities? Bonus promotions differ in their mechanics, conditions, profits and significantly vary in different regions influenced by the requirements of regulators. Despite that, existing promotions can be classified and grouped into several general categories, namely:

1. Welcome bonus is a one-time pay-out for a specific action. For example, the basic model of a welcome bonus may offer an increase of the first clients’ deposit by 30, 40, or even 50%. More sophisticated schemes may allow new traders to create a welcome (demo) account, where they can trade without risks for 30 days. After this term, gained profits may be transferred to a live account, after depositing a certain amount, for example, $100.
2. Deposit bonus is paid as additional funds temporarily given to traders to increase their trading capability. Depending on the invested amount, the percentages of incentives may change. For example, a broker can offer a 50% bonus for deposits of up to 1000$ and 30% for deposits between $1000-3000. This way, the promotion can work not only as a campaign to attract new clients but also stimulate newcomers to invest more. Some brokers pay a percentage for the untraded part of the deposit amount on clients’ accounts, like a regular bank saving account.
3. Rebate bonus is a reward for active trading that depends on trading volumes. During the promotion, a broker assigns a certain coefficient to each symbol, which is then multiplied by the number of lots closed by a trader. For instance, a trader may get $2 for each closed lot of EUR/USD and $3 for USD/JPY. In this case, a rebate increases general trading activity and helps brokers to draw their clients’ attention to specific symbols.
4. Inspired by the negative balance policy, some brokers support their clients during setbacks by offering them a cashback on losses. Cashback may be paid under certain circumstances like reliable trading history or a certain amount of deposit on a trader’s account. There are also some offers with cashback on brokers’ commissions, which encourage trading activity.
5. A suspension of swaps and broker commissions may be realized as part of a business model or a special bonus event. In the first case, it is usually performed by implementing different tiers of trading conditions for clients. E.g., VIP traders may be free from commissions. As a special event, a swap & commission-free period is often timed with some public holiday or brokerage anniversary.
6. Giveaways and trader contests can also be treated as promotions that may be reviewed together. Both giveaways and trader contests are closely related to the gamification of trading and can be easily complemented with other gamification elements like special “achievements” or the trader’s community creation. These two promotions are often used together, e.g., brokers may use trading contests to select participants for the giveaway.
7. Affiliate partnership is the most popular promotional strategy among brokers. According to the results of the research, 68% of brokers offer various affiliated or referral programs via their websites. Usually, the structure of such cooperation is quite simple: an influential trader (an agent) partners with a brokerage and recommends the company to his audience by using a personal referral link. The trader receives a bonus for each transaction completed by introduced clients, for example, 1% of the trader’s profit or a deposit.

This diversity in types and conditions of promotions demonstrates two major points. Firstly, different bonus campaigns can be used not only for covering basic business but for more specific needs. It can be used to attract clients or increase trading activity, or specifically for spurring trading on certain securities and symbols, enticing clients to deposit more, or referring friends. Secondly, there is a need for building creative and interactive promotions that could excite traders about the events.

The combination of accurate goals and unique offers may help brokers to stand out from competitors. The abundance of bonus campaigns may often look chaotic and cause problems for the broker when organizing several events simultaneously. Technology providers offer several types of solutions to fix this problem. For example, products such as the Ratings Module make important information more accessible and simplify communication between traders and brokers. Other solutions, such as the Marketing Suite, streamline the internal processes of the trading platform when organizing several bonus promotions, providing the broker with flexible settings and a convenient interface for managing campaigns.