Top 11 Online Casino Efficiency Factors

Online gambling is only about 20 years old but the industry has confidently overtaken the classic land-based entertainment for money in most indicators. Offline platforms arouse less interest in players, while digital casinos set more new trends. Thus, augmented and virtual reality technologies, as well as solutions with live dealers are considered the most popular.

According to iGaming Business experts, the annual growth of the iGaming sector has reached 10–11%, and this indicator is expected to grow. The general industry revenues in 2018 exceeded €44.4 billion, and by the end of 2022, the profit was already more than €56.8 billion.

Rosloto specialists explain such a situation in the entertainment market and offer turnkey development of projects.

Online Casinos Vs. Land-Based Locations

Before looking at the efficiency rates of gaming sites, it is worth mentioning the reasons for such a huge and rapid growth of the industry. Why offline establishments cannot keep up with internet platforms?

The comparison presented below will help you understand:

We have figured out the reasons for the popularity of online casinos, and it is time for you to learn about the marketing nuances of entering the market.

Top 11 Indicators of Profitability of iGaming Platforms

The first thing operators should think about when it comes to the evaluation of performance and the desire to increase income levels is the proper promotion of their projects. In the gambling industry, the marketing program consists of 2 key areas: the acquisition of users and their subsequent retention.

Strategy implementation methods may vary depending on such factors as internal business construction processes, the geography of the resource, social indicators, and much more. While trying to get new customers, entrepreneurs have learned to use such interesting and sneaky tactics.

This made a natural question arise: “How to measure the effectiveness of strategies and the level of return on financial investments in the promotion of a start-up?”

This is where the KPI performance indicators came in handy. In the gambling industry, metrics come down to 2 areas: funds and people (there are also combined metrics but more on that later).

Money-Related KPI

These are financial indicators that are responsible for the profitability of a project. Such metrics can be classified as follows:

Gross Gaming Revenue

This is the basic tool for the analysis of the success of the company. Calculation formula: the amount of bets placed is subtracted from the size of paid winnings. The indicator shows the level of the institution's gain (not to be confused with income).

The coefficient depends on the luck of the players. Even with identical rates for 2 compared periods, the metric can have different values. It can be explained by the fact that winnings in any virtual casino depend on a random number generator.

Net Gaming Revenue

This is an indicator of the real level of return without deduction of royalties and various operating expenses (commission fees, payments to the providers of gambling software and affiliates, fees for holding a licence, etc.).

The metric is used for the rapid assessment of the profitability of a project. As a rule, the measurement of this indicator does not imply a static formula: it is recommended to develop an individual strategy for each specific casino platform.

Ratio of Net Profit to Deposits

It allows entrepreneurs to visualise the volume of income based on the bets placed by users. In this case, the value of the indicator plays an important role: the higher, the better for the gaming site.

Amount of Bids to Deposits

An analysis of this ratio displays the overall size of the institution's financial turnover. An increase in value indicates an excessive issuance of bonus money.

Monetary metrics can be called the optimal system for checking the financial state of the website.

They allow operators to evaluate the effectiveness of their projects in terms of profitability and demonstrate:

• increase in profit;
• fixation of a sharp decline in indicators;
• the insufficient intensity of revenues.

Human Performance Indicators

They are directly related to the behaviour of players and the effectiveness of attracting potential customers. Such metrics are based on the human factor. Values can be classified as main and secondary.

Among the basic ones, we can name:

Conversion

It is the ratio of the percentage of visitors who performed a certain action to the users who could potentially do it. For example, an ad was broadcast to 1,000 people but only 100 of them clicked on the banner.

The parameter reflects the real number of active gamblers and covers the following indicators:

• the number of clicks on advertising offers;
• the number of registered users;
• percentage of players who have made deposits, and so on.

There are 2 types of conversion in the casino niche:

1. The number of registrations with the total percentage of visitors. It displays the level of activity against the background of total visits to the platform. Small results mean low traffic.
2. The number of registrations with a deposit with the total percentage of user identification. The value is influenced by the accrual of bonuses and distribution of free spins for signing up on the website (until the balance is replenished).

Customer Lifetime Value

This metric shows the net profit from a certain player for the entire period of his activity on the resource. The whole marketing program is aimed precisely at increasing this indicator and has 2 directions:

• extension of the loyalty period of users (the goal is to increase the probability of the fact that casino visitors will return for new sessions);
• the maximum average check (the income from a particular customer after 1 game).

The calculation formula: the monthly average income multiplied by the average value of the period of loyalty (in months).

Churn Rate

Gamblers are constantly looking for new entertainment. Their desire to find new experiences is one of the biggest but almost unsolvable problems for every operator. The churn rate displays the percentage of users who stopped visiting the casino. Usually, the indicator is compared with the number of active players for a certain period.

A reduction in the rate confirms the normal functioning of the customer retention strategy.

Secondary Human Performance

Let us review them in more detail:

Failure Rate

It is used to determine the percentage of clients who visited the iGaming platform but did not complete the targeted actions. For example, the user only got acquainted with the main page of the website or stayed on the resource for less than 1 minute.

The metric displays the level of random ingress and the percentage of the audience that visited the digital casino deliberately but was not interested in the offered product range.

Depth of Viewing the Site

It displays real user interest:

• how many pages were opened during 1 session;
• how much time was spent by gamblers on the specific page.

The metric allows entrepreneurs to calculate the level of convenience of the interface and identify areas that need to be improved or updated.

Combined Indicators

This is a connecting element between the basic types of values. Specialists classify it as follows:

Customer Acquisition Cost

This is the amount of money spent per user who has completed a set of targeted actions (registration, placement of the first bet, and so on). The metric contributes to the rational distribution of the budget and demonstrates the overall effectiveness of the marketing campaign.

Let us say $1,000 was spent on the promotion of a resource in a week. During this period, the casino was visited by 200 active players. Accordingly, the cost of advertising per client is $5.

The success of the advertising campaign means the full recovery of costs due to the actions of gamblers. The smaller the item of expenditure for 1 user, the more effective the entire promotion system.

Average Revenue per Customer

This is the level of income received from 1 player for the selected time.

The scheme of calculation: the total income of the iGaming site must be divided by the number of active users for the specific period.

Analytics and Monitoring System

We have mentioned the main parameters of the effectiveness of casino platforms. Now we need to figure out how to track and organise them.

Interpretation of indicators is the job of professional marketers. Without a certain amount of knowledge, it will be very difficult to understand it.

However, the tracking, collection, and subsequent processing of information are performed by special software that excludes human error. A set of analytical tools is part of any online casino resource. The system is designed to receive data and transform it into a visual flow of important details.

A gaming site is not just a platform with a wide product range. The main mechanism of operation is usually hidden from customers and managed by a project owner and a team of qualified specialists.

High-quality platforms combine the following features:

• interaction with players and affiliates;
• control over all financial transactions;
• automation of the process of data collection and processing;
• a set of marketing and analytical tools.

Depending on the offered options, the platform can provide the widest range of interactive reports. Modern solutions make it possible not only to cover the maximum set of processes and markers but also to process information flows in real time.

As a rule, the iGaming platform is an adaptive product with the ability to make individual settings.

However, even the most high-quality solutions are not designed to cover all aspects of the business. For example, to analyse the auxiliary casino controls, operators will have to use additional accounting tools.

External factors that affect the effectiveness of the work of gambling resources include:

• office space rentals;
• bonuses for employees;
• unforeseen internal expenses, and others.

A comprehensive process of tracking and evaluating key performance factors is one of the secrets to the success of any business. Using analytical data, operators can control the main items of expenditure, change the marketing program, and increase the profitability indicators of their projects.

The Main Things about Online Casino Efficiency Factors

We have identified 11 elements that affect the development of the gambling business:

• GGR;
• NGR;
• net profit to deposits;
• rates to deposits;
• conversion;
• customer lifetime value;
• churn rate;
• failure rate;
• the depth of viewing the site;
• customer acquisition cost;
• the average revenue per user.

All these performance indicators are closely interrelated. Comprehensive analytics is the only way to assess the level of profitability of a gaming site and develop an optimal strategy of action.

Such metrics guarantee transparency and display the real situation with all the pros and cons of the project. A regular multi-level analysis is the basis of effective promotion.

The gambling platform is a practical and convenient solution that can process almost any request. Nevertheless, we recommend that operators leave such tasks as the evaluation and development of a marketing strategy to qualified specialists.

You can learn more about the establishment and promotion of an online casino from the Rosloto studio.

From us, it is also possible to order such useful services:

• development of unique HTML5 games;
• creation of a turnkey gambling platform;
• advertising of an already existing business, and much more.

For any questions, please contact our managers.