What is it that we Player Development people do? The quick answer would be: we analyze stuff. As we all know, Retention Marketing is based on the assumption that as a service provider, we can increase the engagement levels of our customers by tweaking our offering in such a way that it can, at least, be perceived as more attractive to them. We learn from the past and the environment, and try to apply our findings through promotional campaigns. Now, how NOT boring and sexy does that sound?? I know!
So while you iGaming CRM executives sip single-malt whiskeys at your spacious corner offices, and gaze occasionally from the yacht harbor’s panoramic view to your monitor screens, what is it that you are in fact looking for? Board level people call them KPIs, but being hands-on with our approach (and salaries) we simply call them metrics, although both terms are equal in their meaning. These are the analytics we should monitor in order to keep on track with a pre-defined plan. Well, to the Excel:
We have previously explained the importance of NGR in our Bonus Costs Calculation post. To summarize, NGR pays your salary. As simple as that. Since your online casino brand earnings are nothing but your players’ losses, than this is by far the one single thing you monitor all the times.
As also said, NGR over time is your Lifetime Value (LTV) – the holy grail of iGaming Operators. Why? If you can maximize your LTV and present higher values than your direct competition, your offering becomes more attractive to affiliates, who would not only find it easier to promote your brand on top of others, but might also settle for lower revenue share deals, knowing that their potential earning is not harmed. Some marketing directors can’t read these lines without looking for a nearby tissue paper…
Tip #1: What is the average lifetime of your players and how can you tell what the LTV is without knowing this parameter? The lifetime term is too complicated for such a brief review, but you don’t really need it in order to vaguely estimate the average LTV. You can simply divide the entire sum of NGR throughout your brand history (since day 1), by the total number of real money players who made at least one successful deposit for the same period. Much like your love life: it’s quick, dirty and yet satisfies most of the functions involved.
Tip #2: From time to time, check on the NGR / Deposits ratio. Too low? Might be winners or abusers. Metallica can tell you what to do in such a case. Too high? Your players might be burning through their cash faster than they should. Your company should have a strategic definition of the desired loyalty levels, and if there is no risk of missing them, then you can indeed have the rest of the day off.
NGR is of course your GGR, deducted from all costs, which is essentially the house advantage multiplied by the sum of funds wagered. This Bet (or handle) factor has a tremendous importance, especially for sports focused operators, but also to you, Pit Boss. In fact, most of your non-deposit promotions aim to increase the volume of activity in your brand (i.e. customers playing more, or betting higher amounts), knowing that this is the first step on this 2.7% edge journey between their pockets and yours.
Tip #3: Monitor the BET / Deposits ratio. This will show you how many times your players circulate each $/€/£/¥ they have deposited, and the results are obviously opposite from the previous tip (#2): higher figures mean that it takes more time to lose whilst lower results indicate that you dry them at a faster pace. Deviation from the standard might also mean that the games don’t function as they should (RNG problems, etc.), and you might need to consult with your software provider.
Tip #4: The Withdrawal / BET ratio provides you with a reliable method to project the expected TRUE loss out of gaming activity. Relevant when you make Wagering Requirements Evaluations.
From Bets, we got the GGR, and from this we get the NGR. In between you find the so called costs, or Bonuses. Let’s face it – it’s the handiest tool to lure your players and provide them with an instant reward. It’s always nice to give away bonuses. It’s even nicer when they aren’t being cashed out.
Tip #5:A very important indicator to keep track of is your Bonus / NGR ratio. This changes between the different segments of your players, though for each tier you should have both the standard rules of Min / Max limits, and the “out of standard” exceptions for those unique players who make your bosses grin like a Cheshire cat as they read the daily reports.
Tip #6: If you apply any points-based system, the points’ value should already be calculated into the Bonus / NGR ratio. A cost is a cost, so don’t get lost.
Tip #7: Occasionally you might hear people in your company getting excited about a day that had a very high volume of bets, or a deal with an affiliate whose players have large deposit sums. Complete BS. If it doesn’t have NGR in it – don’t count it. Putting aside the amazing employment terms and the supportive working atmosphere (oh, and your dreams as well), you are there to make money for your company. Anything that counts must contain some kind of a reference to the bottom line, and as such NGR is the monarch king, and LTV is his prophet. All other parameters are secondary and logistical at best.
Done for now. Soon we will publish a similar list for Online Poker, and meanwhile let me just remind you of the iGaming Promothon: the first ever industry-wide review of Christmas promotional campaigns, done by the Leading Online Gambling Retention Marketing Experts. Do you want to show off with your Christmas promo offering? Submit your campaign and we will be happy to interview you and publish the discussion. Bring it on!