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Each type of business uses its KPIs. As a rule, they differ significantly from each other depending on the type of project (digital or offline) and the area of focus (retail, finance, tourism, gambling, etc.).
The Casino Market company will tell you about the main KPIs in the iGaming niche. We will explain the metrics that need to be used to evaluate the success and strengths of a startup, and options for business scaling. Also, our managers will assist you with any questions.
The Description of KPIs
They show the effectiveness of the activity of gambling platforms and the correctness of the chosen strategy, and some aspects that need to be improved.
KPIs should be directly related to the goals of the project. For a gaming site, this is an increase in attendance. Different purposes involve different groups of key performance indicators but in the end, they all boil down to higher return rate and ROI.
The term was first used in 1932 by the French scientist, Jacques Malo, in his management concept —Scorecard (Tableau de Bord in French). A bit later, Stuart Stern, Keith Roberts, Lorenz Meisel, and other economists and publicists also considered the KPI phenomenon.
At the moment, the indicator is an integral part of the BSC — a balanced scorecard. It is used for a comprehensive assessment of the activities of the enterprise and decision-making on the issuance of loans or funds for joint investment projects.
Why Online Casinos Need KPIs
Their implementation performs a wide range of tasks:
- Evaluation of the results of the activity of an iGaming startup. Using simple and understandable metrics, operators can calculate the cost of launching and promoting a website, and check the performance of hired employees. They analyse the return on investment as well. Entrepreneurs can see the real state of affairs, expressed in figures.
- Analysis and planning. KPIs allow casino owners to set clear and measurable goals and easily achieve them. No wonder most of the business plan is based on KPIs. Operators indicate the expected conversion rates, profitability, and payback, which they want to achieve in 6–12 months or more. Then, the real metrics are compared with the basic ones, due to which the correctness of the chosen business model is assessed.
- The motivation of employees. KPIs can also be related to the staff to evaluate how well they cope with their duties. Based on the indicator, entrepreneurs can make a decision about the payment of bonuses, salary increases, and other options for rewards.
- Selection of a marketing strategy. In gambling, KPIs are most often discussed in the context of casino promotion. The system of these metrics is quite extensive: you can calculate the number and cost of clicks to the website, spendings on the attraction of one gambler, and much more.
Financial KPIs in the iGaming Business
This group of metrics allows entrepreneurs to evaluate the success and profitability of their casino startup as a whole. The indicators will benefit both the internal consumer (shareholders, managers, and employees) and external organisations. These may be business partners, investors, and other related parties.
GGR — Gross Gaming Revenue
It measures the operating income of a casino and is calculated as the sum of all bets placed by players minus their winnings.
Already at the stage of counting GGR, operators can evaluate:
- How often and at what limits do users gamble, and how their choice is reflected in the size of the GGR.
- How competently the game content was selected in terms of volatility, RTP, and available bonuses.
GGR is an important metric for predicting business taxation. In most jurisdictions, in addition to income tax and salary deductions, casino owners also pay a fee for the gambling turnover. There is a similar practice in Malta, Romania, South Africa, Denmark, and other countries where this industry is legalised.
Gross gaming revenue may vary every month. It is affected by seasonality. According to statistics, during winter, customers spend more time on iGaming sites than in summer. There is also a chance factor. The prize combinations formed by the RNG do not always match the declared RTP level (percentage of return rate).
NGR — Net Gaming Revenue
The indicator shows the real income of the casino platform, including such additional costs as:
- licence fees;
- royalties;
- lease payments;
- taxes (from GGR and payroll);
- commissions to payment processors;
- settlements with affiliated services;
- payments to a hosting provider;
- bonuses, and other expenditures.
Without other expenses, NGR shows how much money online casinos actually have at the end of the reporting period. The metric is suitable for high-quality express analysis of the operation of an iGaming site. It demonstrates not only the revenue but also the account part of the operator's budget.
Knowing the NGR, entrepreneurs can calculate 2 additional values:
| NGR to Deposits | This is the difference between GGR and operating costs divided by total deposits. The metric shows how much profit was brought to the operator by the funds deposited by players. The higher this figure, the better. The parameter also makes it possible to evaluate the income structure of an iGaming site since, in addition to direct deposits, casino owners can receive revenue from advertising, joint partnership projects, sponsorship, and other activities |
| Rates to Deposits | The value demonstrates the turnover of money on a gambling platform. Its growth indicates that the resource spends too much money on rewards for users, and its decrease indicates the correct bonus policy of the operator |
ROI — Return On Investment
It shows how quickly and to what extent the money spent on the launch and promotion of the iGaming site is returned.
The metric is calculated as the difference between GGR and financial injections in a casino divided by the total amount of investments. A value less than 0 or 100% (for example, 0.94 or 94%) indicates that the gambling platform is working at a loss. A higher indicator confirms the correctness of the chosen business strategy.
Investments mean both one-time expenses (for example, for the purchase of a gaming site or the creation of its design), as well as monthly payments to employees and software rental. ROI can be calculated taking into account all costs or in terms of starting and current investments in a gambling project.
ROI is always included in the business plan, predicting the parameter for several years ahead and then comparing the expected result with the real one.
The indicator cannot be considered out of context. It is better to analyse financial KPIs (GGR, NGR, and ROI) over time. If, for example, 6 months ago, the return on investment was 74%, and now, this metric is 87%, then operators are on the right track. In parallel with the growth of ROI, iGaming resources can increase revenues and reduce costs.
Marketing KPIs in Online Casinos
Advertisers use such indicators to evaluate the correctness of the chosen strategy for attracting and retaining customers.
There are 7 categories of KPIs in the gambling business:
Traffic
Its quality is evaluated by the level of attendance, the number of page views, and other characteristics.
One of the most important KPIs is CTR (Click Through Rate). The indicator is calculated as the ratio of the number of clicks on an ad to the number of impressions.
User Behaviour
This category includes the following values:
- TSS (Time Spent on Site). This is the period the player has spent on the platform. The longer he studies the content (entertainment catalogue, registration conditions), the better.
- PPV (Pages per Visit). It shows the depth of the page view. It reflects the interest of users in the content on the gaming site.
Conversion
CR is the ratio of customers who completed the target action to the total number of casino visitors. The metric is calculated per day, week, or month.
In this case, the target action is the registration on a gaming site, the deposition of funds for the first time, the launch of the reels in a slot, the completion of missions, and much more. Each gambling resource has different parameters and requirements for calculating CR but the higher this indicator, the more effective advertising works.
Cost of Visits
The main KPIs from this category are the following:
- CPV (Cost Per View) — the cost of viewing an advertisement;
- CPC (Cost Per Click) — the cost of one click on a banner;
- CPL (Cost Per Lead) — the price of the registration of a user;
- CPA (Cost Per Acquisition) — the cost of attracting a player.
For an online casino, the last metric is quite important. It shows how many real clients have not only registered and verified their identity but also made an initial deposit.
The budget of most marketing campaigns is formed based on CPA, while CPV, CPC, and CPL are of secondary importance for the gambling business.
Average Revenue Per User
To calculate the ARPU indicator, it is necessary to divide the online casino’s monthly or annual income by the number of active clients for this period.
The higher the figure, the better the operator pursues a policy of user retention. Players do not just come to the website for a quick impression but stay on it for a long time and become regular customers.
Return on Marketing Investment
It shows how quickly the funds invested in an advertising campaign pay off. To calculate the metric, it is necessary to divide the difference between the casino income and the marketing budget by all the costs associated with the promotion of the iGaming site.
A value greater than 1–100% indicates that the money is spent efficiently and is beneficial in the form of an increase in Internet traffic and the operator's profit. If the ROMI is equal to 100%, then it means that the marketing campaign has broken even, and if it is less than the boundary value, it may be considered unsuccessful.
The decision to monitor ROMI helps entrepreneurs to:
- optimise advertising costs;
- change promotion strategy;
- divide the budget into “weak” and “strong” channels;
- raise additional funds for marketing.
Repeat Visits and Registrations
This category includes the following metrics:
| RVR (Return Visitor Ratio) | This rate illustrates how interesting the gaming site is to players. The low number is typical for platforms that offer only one product or service. These can be, for example, resources that belong to car dealers or construction companies. Online casinos need to strive to increase the RVR indicator. The metric can clearly show how well the audience responds to new games, bonuses, seasonal campaigns, etc. |
| LTV (Lifetime Value) | It reflects the net income that users have brought throughout their activity on the iGaming portal. The indicator is calculated as the product of ARPU and the number of months spent by a client in an online casino. The key goal of most marketing campaigns is to achieve an average LTV |
| CR (Churn Rate) | This is the opposite metric to the previous one. It displays the number of users who, for whatever reason, have stopped placing bets on a gambling platform. Entrepreneurs need to strive to reduce CR. This indicates the effectiveness of the customer retention strategy |
How to Calculate Marketing KPIs
The most popular option is to use Google Analytics. This powerful tool allows operators to evaluate the effectiveness of their advertising campaigns quickly and free of charge by giving access to advanced statistics and analytics.
With the help of the service entrepreneurs can find:
- primary data — clicks, impressions, unique users, time spent on the website;
- conversion rate;
- the price of an impression, a click, a lead, a player’s attraction;
- cost recovery and profitability of marketing expenses.
The tool contains hundreds of reports in the form of tables and visual charts based on historical data and real-time information.
The Main Things about Key Performance Indicators in the Casino Niche
KPIs demonstrate the success and efficiency of the iGaming business, expressed in quantitative indicators.
- The metric allows entrepreneurs to quickly evaluate the work of their projects, conduct a thorough analysis and planning, choose a winning marketing strategy, and properly motivate employees.
- Key monetary KPIs include GGR, NGR, and ROI. They help business owners assess the financial condition of their companies, conduct an express check of their strategy, and predict the size of the fiscal burden.
- KPIs in the advertising sector include conversion, user acquisition cost, return on marketing investment, etc. A thorough analysis of the metrics allows operators to evaluate the correctness of the chosen promotion strategy, the effectiveness of actions aimed at attracting and retaining the audience, the reaction of gamblers to new content and bonuses, and much more.
The Casino Market studio provides professional marketing services for iGaming projects. We use different advertising methods (SEO, SMM, targeting, and affiliate programs) and always intend to achieve the highest KPIs.
From us, it is also possible to order:
- development of a turnkey online casino;
- launch of a White Label platform;
- installation of payment systems;
- creation of HTML5 slots according to individual sketches;
- integration of security software, and much more.
For all questions, please contact our managers.
Have questions or want to order services?
Contact our consultants:
- e-mail: manager@casino-market.com
- Skype: support.casinosupermarket
- feedback form.
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