- Online gambling blog
- Understanding Customer Lifetime Value in a Casino 2021
Understanding Customer Lifetime Value in a Casino 2022
Player lifetime value (LTV) is an important metric that online casinos use to measure their performance. Gauging LTV can help determine which marketing and customer relationship management strategies are the most effective and which player segments are the most valuable.
Calculating LTV 2022
LTV measures a player’s estimated net value to an online casino from the date of customer acquisition to the end of the player’s relationship with the site. LTV considers the revenue earned from a customer and compares it to the predicted customer lifespan. The closer you look at the topic, the more formulas there are to break it down, but for this blog post, we’ll keep it simple.
Player LTV can be determined by multiplying the casino’s Average Revenue Per User (ARPU) by the average length of time players stay on the casino. ARPU is measured by dividing the amount of revenue earned by a casino in a certain period of time by the number of players on the casino in that period of time.
User Acquisition and Retention: Overview of the Top Tools
Getting an online gambling platform up and running and equipping it with a full portfolio of great games is only half the battle. Online casinos need a consistent number of new and regular depositing pla...Learn more
In short, player LTV is the total amount of money generated by a player over the entire length of their relationship with the casino.
Why LTV matters
An accurate estimation of how much a player is potentially worth will have a direct effect on customer retention strategies. Keeping a player on the site is self-evidently worthwhile, but not to the point where you’re spending more on them than they are on you.
Not all players are equally valuable. A customer who bets a few dollars on a football match once every few months is less valuable than one who bets hundreds of dollars a year on online slot machines, and your attention and marketing budget should be spent on them accordingly.
It’s important to balance player LTV against customer acquisition cost (CAC). One common rule of thumb is the 3:1 ratio - a customer’s lifetime value should be equal to three times the acquisition cost, though some experts allow for a smaller ratio of 2:1. The better the ratio, the better the return on investment.
A thorough understanding of LTV can help an online casino understand the value of different player segments and properly tailor their customer service.
Slotegrator offers everything gambling operators need to launch and expand online casino and sportsbook projects. The company offers a wide range of products, including White Label online casino and sportsbook platform development, game content, betting data feeds and payment systems integration. Slotegrator also provides legal consultancy and administrative assistance for gambling license acquisition and regulatory compliance.
It’s in a casino’s best interest to raise LTV as high as possible. This can be done by extending the player’s lifetime on the site, increasing the amount of revenue from each visit, or, hopefully, both.
Extending a player’s lifetime on the site can be managed with effective CRM software. Players will provide value to the casino as long as they feel it provides value to them. Using loyalty and VIP programs to make sure players know they’re important will result in increased bet sizes and an extended player lifetime.
Effective casino customer service will decrease churn rate and increase lifetime value. Of course, the most effective method of increasing player LTV is by offering a high-quality product. Keeping an online casino updated with the latest slots and live dealer games is the most important step towards building casino customer loyalty.
How to start an online casino in 2022
The online casino and sportsbook business is booming, and the revenues that a well-run online gambling platform can generate are a tempting prospect for investors and entrepreneurs. But how do you climb ...Learn more
Leave a comment
Online Casino Wager Bonuses As a Tool For Customer Retention in 2022
Severe competition on the online gambling market forces its participants and online casino owners to use various tools aimed at customer r...
Progressive jackpot slots in online casinos 2022
Online casino jackpots have recently become a pretty common strategy used by online casino operators in order to attract and retain custom...
Slot Machine Volatility With Examples 2022
In gambling, there is such a thing as volatility. Volatility is often confused with other gambling terms, for instance, with variance. Let...