Behind every successful affiliate marketing strategy lie key metrics. Just like the fuel gauge in a car helps a driver monitor energy levels and plan their journey accordingly, these measures help marketers track performance and identify areas for growth and improvement.
While there are many metrics to consider in the affiliate marketing profession, in this article, our focus is on key performance indicators (KPIs), namely gross gaming revenue (GGR), net gaming revenue (NGR), and others.
We offer you a comprehensive guide that will equip you with useful knowledge and strategies to leverage data-driven insights and elevate your casino affiliate marketing efforts. And what more? Read on to discover our answers to a few important questions, including: What is GGR in gaming? What does NGR mean? How do you calculate KPI?
What is GGR?
In gaming, gross gaming revenue (GGR) refers to the sum of money that players wagered at a casino, regardless of whether they won or lost. It includes all bets placed on table games, slots, and other gaming activities.
To calculate GGR in casino gaming, you simply add up all the bets placed during a specific period. For example, if a casino records €100,000 in bets on slots, €50,500 on blackjack, and €25,500 on roulette in a single day, the GGR for that day would be €176,000. So, this is how to analyze GGR in sports betting, casino gaming, or any other gambling context.
What is NGR?
On the other hand, net gaming revenue (NGR) refers to the amount of money that a casino earns after making some necessary deductions to arrive at the “real” revenue generated during a given period. The deduction operation usually includes the subtraction of winnings paid to players, chargebacks, bonuses, and other promotional expenses from the GGR.
In case you don’t know how to analyze NGR in gaming, here is a simple guide: To calculate NGR, subtract the total winnings paid out to players from the GGR. Continuing with the previous example, if the casino paid out $120,000 in winnings on the same day, the NGR would be €56,000 (that is, €176,000 GGR minus $120,000 spent on winnings).
Now, we have a question for you: between GGR and NGR, which is a better measure of an online casino’s revenue during a particular time? Our guess is that you got the answer correct. NGR is a more accurate indicator of a casino’s profitability than GGR. The reason is that the former reflects the actual revenue generated from gaming operations.
Analyzing Critical KPIs
In addition to GGR and NGR, there are numerous other KPIs that casino affiliate marketers should track and analyze to assess their performance and identify growth opportunities. These KPIs can be broadly categorized into three main groups: those related to finance (money-related KPIs), those related to human behavior (people-related KPIs), and those that encompass both financial and human elements (hybrid KPIs).
Don’t worry, we won’t be going into any “boring” calculations in this section. We just want to help you gain fundamental knowledge and understanding of these additional critical KPIs. So, let’s explore them with their positive indications at the end of each specific KPI.
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Essential Money-Related KPIs in iGaming
Like GGR and NGR, money-related KPIs provide insights into the financial performance and profitability of an online gaming platform. In addition to the aforesaid examples, here are some key money-related KPIs that affiliate marketers should monitor and consider for casino revenue breakdown:
Deposit Frequency: This metric tracks how often players make deposits into their casino accounts over a specific period. A higher deposit frequency indicates that players are actively engaged and making repeat visits to the casino.
Return to Player (RTP): RTP represents the percentage of all wagers that a casino pays back to players over time. A higher RTP indicates a more generous casino and attracts more players. Casinos with a high RTP tend to have a loyal player base.
Average Bet Size: This metric shows the average amount wagered by players per bet. A higher average bet size indicates that players are willing to risk more money, potentially leading to increased revenue for the casino.
Average Revenue Per User (ARPU): Also known as “average casino revenue,” ARPU represents the average amount of revenue that every active player generated for the casino over a specific period. The right way to calculate it is by dividing the total revenue by the number of players who are active at the iGaming site. A higher ARPU indicates that the casino is effectively monetizing its player base.
Customer Lifetime Value (CLV): CLV represents the total amount of revenue that a casino can expect to generate from a customer over their lifetime. It is a crucial metric for measuring customer loyalty and profitability. Casinos with a high CLV have a sustainable business model.
Customer Acquisition Cost (CAC): Also known as CAC, this metric measures the average cost of getting a new player to join the gambling platform. To calculate CAC, the total marketing expenses amount is divided by the number of new players acquired. A lower CAC indicates that the casino is efficiently acquiring new players.
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Important People-Related KPIs in iGaming
People-related KPIs provide insights into the behavior and engagement of players on an online casino platform. Here are some key people-related KPIs that affiliate marketers should monitor:
Number of Active Players (NAP): This metric, which could be calculated monthly (that is, Monthly Active Players) or weekly (that is, Weekly Active Players), tracks the number of players who have made at least one bet during a specific period. A growing NAP indicates successful player acquisition and retention strategies. The reverse is the case for a falling NAP.
Player Retention Rate: This KPI measures the percentage of players who continue to play at the casino over time. A high retention rate indicates that the casino is providing a positive gaming experience and retaining its players effectively. Casinos with a high retention rate have a loyal player base.
Conversion Rate (CR): The conversion rate refers to the percentage of visitors to the casino’s website who actually sign up and become players. A higher conversion rate indicates that the casino is effectively converting website traffic into paying customers.
Net Promoter Score (NPS): The NPS measures customer satisfaction and loyalty by asking players how likely they are to recommend the casino to others. A high NPS indicates that players are satisfied with the casino’s offerings and are likely to become advocates for the brand.
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Hybrid KPIs for Affiliates
Hybrid KPIs combine elements of both money-related and people-related KPIs to provide a comprehensive view of casino performance. Here are some key hybrid KPIs that affiliate marketers should monitor:
Cost Per Acquisition (CPA): CPA represents the average cost of acquiring a new player. It is calculated by dividing the total marketing expenses by the number of new players acquired. A lower CPA indicates that the casino is efficiently acquiring new players.
Revenue Per Player (RPP): RPP is the average amount of revenue generated by each player over a specific period. A higher RPP indicates that the casino is effectively monetizing its player base.
Player Acquisition Cost (PAC): PAC is the total cost of acquiring a new player, including marketing expenses, bonuses, and other incentives. A lower PAC indicates that the casino is efficiently acquiring new players.
Strategies for Analyzing GGR, NGR, and Critical KPIs
To become a successful affiliate marketer in this dynamic industry, you need to not only analyze GGR, NGR, and other critical KPIs that we’ve shown you but also do it strategically. Here are the strategies you can use to analyze these KPIs and keep your business growing with the help of advanced data analytics.
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Establish Baselines
Before you can improve, you need to know where you stand. Establishing baselines is your first step in understanding your current performance levels and identifying areas for improvement. To do this:
Gather Historical Data: Start by collecting historical data on your GGR, NGR, and other key KPIs. This will give you a clear picture of your casino’s current performance levels. Think of this as your starting point, a baseline against which all future improvements will be measured.
Identify Key Metrics: Determine which KPIs are most relevant to your business goals. These could include player acquisition costs, retention rates, average player value, and more. By focusing on the right metrics, you can gain more actionable insights.
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Set Measurable Goals
Once you have a clear understanding of your current performance, the next step is to set specific, measurable goals. These goals will provide a clear direction for your efforts and help you stay focused.
Define Specific Targets: Once you have your baseline, the next step is to set specific, measurable goals. For example, you might aim to increase your NGR by 15% within the next quarter or improve your conversion rate by 20% over the next six months. These targets should be ambitious yet achievable, providing a clear direction for your efforts.
Align Objectives with Business Goals: We strongly recommend that you do your best to make sure your marketing objectives are in alignment with your broader business goals. For instance, if your primary aim is to increase profitability, focus on improving metrics that directly impact your bottom line, such as NGR and profit margins.
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Analyze Trends and Patterns
With your goals in place, it’s time to dive into your data and analyze trends and patterns. This will help you understand the factors driving your performance and identify opportunities for improvement.
Identify Fluctuations and Seasonal Variations: Dive into your data to identify any fluctuations, seasonal variations, or long-term trends. For example, you might notice that player activity spikes during certain holidays or events. Understanding these patterns can help you optimize your marketing campaigns and promotional offers.
Use Advanced Analytics Tools: Leverage advanced analytics tools to gain deeper insights into your data. Tools like Google Analytics, R, Microsoft Excel, Tableau, or specialized casino analytics platforms can help you visualize trends and uncover hidden patterns.
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Experiment and Optimize
Armed with insights from your data analysis, you can now experiment with different strategies and optimize your efforts. This is where you can test new ideas and make data-driven decisions.
Implement Strategic Changes: Based on your analysis, implement strategic changes to your marketing campaigns, promotional offers, and overall business strategy. For example, if you notice that certain promotions are particularly effective, consider running them more frequently. Conversely, if some campaigns are underperforming, it might be time to tweak or replace them.
A/B Testing: Conduct A/B testing to compare different versions of your marketing campaigns or website elements. This can help you determine which strategies are most effective and should be scaled up.
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Continuously Refine Your Strategies
Data analysis and optimization are ongoing processes. To stay ahead of the competition and continuously improve your performance, you need to regularly review and refine your strategies.
Regularly Review and Refine: Data analysis is not a one-time activity; it’s an ongoing process. Regularly review your performance against your goals and refine your strategies based on the insights you gain. This continuous cycle of analysis and optimization ensures that you are always moving forward, adapting to changes in the market, and seizing new opportunities.
Stay Updated with Industry Trends: Keep an eye on industry trends and best practices. The online casino industry is constantly evolving, and staying updated can help you adapt your strategies to stay ahead of the competition.
Our Final Takes
Critical KPIs, especially GGR, NGR, PAC, CLV, CR, and ARPU, are fundamental metrics that provide a clear picture of the performance of an iGaming business. They are crucial for evaluating your overall marketing strategy and making informed decisions.
So, whether you’re a casino operator or an affiliate, mastering the metrics and strategic KPIs that we’ve shared in this post is essential for triumphantly navigating the competitive landscape of online gambling and achieving remarkable growth.
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