Measuring the progress of your online casino is one of the most important things that you should embrace on a periodical basis. There are several yardsticks that you need to take into account when weighing the performance of your online gambling business. These benchmarks are the KPIs (Key Performance Indicators) of online casino businesses that can show you what needs to be improved and in what fields you are doing the best.
The acquisition of specific, detailed player data is the gold criterion for assessing various factors that balance and adjust your business. The more you know about your players’ preferences and habits, the better you address their needs and design personalized experiences to increase retention rates and loyalty (For further information, you can also read our article “how to market an online casino“). At this stage, KPIs become the most valuable components that can gauge the results and aid you in capturing and generating actionable insights.
In essence, key performance indicators are the measurable metrics that show the pulse of your company. Nonetheless, there is no unique method or equation that will teach operators how to run and manage their businesses. It’s rather based on your experience, intuition and the understanding of the iGaming business in general.
Sometimes the final results are only shown when your campaign goes right down to the wire. KPIs are the series of metrics that assess the performance of your online casino business and diagnose the deficiencies, but they don’t tell you how to improve those defects and shortcomings.
Yet, tracking and analyzing KPIs gives you various opportunities. For instance, you can chart the outcomes to understand how you improved and make adjustments accordingly to your business model.
There are various KPIs of online casino, including GGR, NGR, NGR-to-Deposits, Bets-to-Deposits, Conversion rates, retention and churn rate, lifetime value, etc. They can be divided into bottom-line, marketing-related, and hybrid KPIs. Keep reading to learn more about the most frequently used and the most effective metrics that can help you evaluate your online casino’s performance.
Bottom line online casino KPIs
The bottom line KPIs are money-related, financial key performance indicators. These metrics can help you carefully examine your annual or monthly report, budget and income.
GGR (Gross Gaming Revenue)
Gross Gaming Revenue is one of the basic KPIs of an online casino that shows how much money your gambling business earned over a specific period. To measure your GGR, you have to subtract the number of players’ winnings from the total amount of money they’ve wagered.
Nevertheless, GGR does not include the payouts such as bonuses. It excludes the value of signup, deposit bonuses, and any additional expenses that you delivered to players.
There are various reasons that can explain the recession in your GGR. You can’t always figure out the exact causes affecting the downturn in this criteria. Nonetheless, you can devise encouraging campaigns to increase the number. Specifically, you must work on bringing new users to your platform and retaining the existing ones.
You can improve these fields by starting new tournaments and jackpots and giving away free spins and bonuses to encourage gamblers to sign up and make subsequent deposits. Although, you also need to take preventive measures and deploy defensive programs to avoid bonus abuse.
NGR (Net Gaming Revenue)
Net Gaming Revenue is computed by the following operation – Gross Gaming Revenue minus the chargebacks, bonuses, licensing fees and taxes, commissions sent to payment system providers, and royalties paid to game content providers.
Net Gaming Revenue is the most objective index of your online casino’s real profit. It is more detailed and thorough than GGR and takes a broader array of costs into account. As a result, financial experts recognize NGR as one of the most important online casino KPIs. It enables you to detect the profit, loss, and other key figures such as the sum of the payouts from winnings and total expenses from the welcome, deposit, and no deposit bonuses. It also detaches the service taxes from the final outcome, allowing you to properly distinguish the actual, real win from the losses and expenses.
NGR-to-Deposits & Bets-to-Deposits
NGR-to-Deposits displays the percentage of user deposits that convert into the revenue for your casino. At the end of the day, only a small fraction of income may turn into net earnings. Thus, this criterion allows you to understand how much of the player’s wagered deposits are transferred into the actual profits.
Bets-to-Deposits counts how much the players bet from the total amount of the money they deposited into their account. As you would expect, only deposits are worthless to your balance sheet. Players must wish to run the risk and bet from their pocket.
On the other hand, neither wagered money can be considered a gain. This accounts for the real difference between NGR-to-Deposits and Bets-to-Deposits. The first criterion shows you the number that is transformed into the actual winnings of your casino.
Analyzing those two metrics can show you whether you are presenting enough enticing offers and encouraging incentives to your clients. In short, if players are making deposits but not making bets, one problem might be the shallow, poor gaming content.
Marketing-related metrics measure your online casino KPIs according to the marketing and advertising activities. They can also tell you how long your clients’ loyalty lasts. These metrics can show at what stage they stop following your platform, how active they are, etc. In a nutshell, these indicators are related to your past, present, and future players. They can help you in improving the quality of operations that may bring more clients and retain the existing ones.
Conversion rate is the proportion of players who completed the action you wanted them to perform with those users who could have performed the same activity. For instance, the number of users who clicked on the banner linked to your site vs. those who saw the ad but didn’t click on it.
Conversion rate is the metric that can signify the soft, fragile links in the chain of the customer journey. It can indicate at which part of the marketing funnel customers leave. Thus, with that number in mind, you’ll be able to create the map of the customer journey and devise effective solutions to strengthen the weak spots of the funnel.
Conversion: visitors to signup
As simple as it gets, this specific indicator tells you how many visitors to your online casino website register on the platform. The complications at this stage may reveal that you need to boost your bonus offerings and promotions to stimulate players to sign up.
Conversion: signups to deposits
This benchmark tells you the number of users who deposited after the signup compared to those who don’t. Again, if the indicator is low, you must consider improving the bonus offerings and providing new enticing suggestions to your clients.
After converting the customers, another milestone you should be focusing your efforts on is retaining them. Like every other KPIs of online casino, the retention rate is measured over a specific period (3, 6 months, or 1 year). The temporal division lets you apprehend how long players tend to stay in your casino and when they decide to leave.
Online casino operators design VIP and loyalty programs to increase retention, enabling players to earn rewards and fringe benefits. Improving customer service is another focal point that can boost your customer’s adherence.
Furthermore, it’s also important to paint your site’s portfolio with new game releases. Moreover, don’t forget to promote the latest products and inform clients about recent updates. These actions can significantly increase users’ interest and engage them in your tournaments and offers.
The churn rate (also known as the attrition rate) is the percentage of those users who leave your platform. Thus, it depicts the rate of customers who have ceased playing games at your casino. A high churn rate indicates that customers aren’t loyal to your company.
Analysis of this benchmark can provide serious implications. Understanding how long your clients stay on your website can help you design new retention strategies and improve the deficiencies. However, it can also point to potential fraud attempts – such as bonus abuse. Players who leave immediately after receiving the sign-up or first deposit bonuses might be bonus hunters scheming their fraudulent plans.
A high churn rate is a significant drawback that needs to be addressed immediately. Unfortunately, there is no one definitive factor that can explain the decline in this metric. As mentioned above, the reason can be an ineffective bonus system. It can also be affected by intense competition and improved performance by competitors who outstripped your marketing offers.
Online casino operators keep detailed statistics while tracking their players’ activities on their platform. Thus, they can check clients’ deposit amounts, frequency, the most favorable games, average time spent on the platform, etc. You can also use this data to devise methods to decrease the churn rate.
Other user-related KPIs are relatively simple, direct metrics that depict the raw statistic results. Nonetheless, they still contribute to your understanding of how your online casino performs. The simplest KPIs are probably Monthly Active Users (MAU) and Daily Active Users (DAU), which track the number of active players in your casino monthly and daily.
On the other hand, Average Session Length per User is another significant metric that measures the average amount of time a specific user spends on your platform during a single session. This criterion can give critical information for aligning your bounce rate and working on the strategies that will decrease it.
Needless to say, the more extended average session means better results and decreased bounce rate. You can improve this indicator by refreshing your gaming content. In specific, you should add new games, release information about the updates, promote the games with longer playing sessions, etc.
Hybrid KPIs of online casino
Hybrid KPIs are the key metrics that relate to both financial and user behavior fields. The list of such indicators involve: Cost per Acquisition, Average Revenue per User (ARPU), and Customer Lifetime Value.
Cost per Acquisition
Cost per Acquisition (CPA) is the average amount of expenses you spend to acquire a new user. In simple terms, it indicates how much you have to pay on average to have a visitor register an account and make the first deposit. Therefore, your CPA has to be as low as possible.
Nevertheless, there are no pre-designed strategies that can help you decrease your CPA rate. The main thing is to focus on the traffic and bring new users to your base. In the case of online casinos, this is mainly done through search engine optimization and the creation of affiliate networks. You can learn more about these strategies in our article about marketing an online casino.
Average Revenue per User (ARPU)
ARPU measures how much revenue a single player can bring to your online gambling business. It is a casino gaming metric that depicts the average winning of your platform generated from a single user.
To calculate your ARPU, you need to know the value of the casino’s total revenue for the given time period and divide it by the number of active users betting during the same time frame. This will depict the mean number of winnings produced from the betting activities of each player.
Customer Lifetime Value
Customer Lifetime Value (CLV) assesses the total revenue produced by the player during the period of staying active on your gambling site. To calculate the value of your CLV, you need to multiply your monthly ARPU by the average customer lifetime.
CLV can give you critical, meaningful results according to the various player segments, grouped by the demographic characteristics, playing habits, etc. Furthermore, analyzing the past and current CLV can also help you anticipate its upcoming values and design the retention approaches.
You can compare CLV with the CPA to thoroughly evaluate the planned marketing strategy and compare the cost of acquiring a new player to the value the given player brings to your casino. Nonetheless, remember that you should consistently check the ARPU and retention rates to understand and analyze the changes in your CLV value.
How to track and analyze the KPIs of your online casino?
It’s not an easy task to observe, identify and measure the online casino KPIs and gaming metrics. What’s more, it is far more complex to track and analyze them as they shift their values during the time. So, where is the easiest solution? While online casino marketers must interpret and analyze the key performance indicators, tracking KPIs is related to the backbone of your casino – the iGaming platform.
The uninterrupted data flow must be captured, stored, analyzed, and transformed into digestible, operative, easy-to-apprehend information in your back office. This is where Upgaming comes into play – we offer our clients an innovative, cutting-edge iGaming platform that gives them maximum control over the infrastructure, automates data management, and instantly provides real-time analytics and reports. Besides, it guarantees the most enduring, indestructible features for your business – a safety and anti-fraud system with one of the strongest defensive protocols in the iGaming industry.
With our iGaming platform, you’ll be able to track, segment, analyze, and improve your online casino’s performance. Contact our business development or support team for a consultation and discover what our iGaming software can do for your business.