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The sports betting and gaming industry is one of the most competitive in the world, with new operators entering the market all the time. This impacts existing operators in two key ways. Firstly, the cost of acquisition goes up, and averages $300 per player, globally. Secondly, it gets harder to sustain player retention rates as they are bombarded by more and more introductory offers.
It’s easy to focus on acquiring new players. However, new players spend less than established players and are more likely to jump as soon as the introductory offer has finished.
Existing players are already invested in you and you don’t need to spend anywhere near as much, per player, to keep them. Retaining players for longer will significantly increase player lifetime value and profits.
Nurture the relationships you already have.
Retaining players means keeping them excited about what you have to offer and making the user experience better than anyone else out there.
Why Retention Trumps Acquisition
It’s important to establish this first. Both acquisition and retention play an integral role in creating a successful business. Getting new customers onto your website or app and using it is necessary to get you off the ground.
Equally you need new players when old players inevitably churn.
When it comes to long term success, a delicate balance needs to exist. You need a steady stream of new players that allow you to replace churned players and steadily grow. But you need to maintain retention waits to sustain long term profitability.
What does a High Churn Rate Mean?
A high churn rate does not spell out great things for your business. It indicates that your customers, for whatever reason, are not happy. This is something you need to rectify as a high priority.
Customers leave because they are not enjoying the experience they are having with you or a competitor is offering a better experience elsewhere. Take a look at your website and app and analyse it. Make sure that your onboarding process, speed of your app or site, user experience, and check out process is all up to scratch.
Your games need to be fun, compelling and offer players a reasonable chance of winning and with tempting payouts.
Ensuring the customer experience is the best it can be will help you reduce that rate of churn. If not, then you will see that number stay the same, or even increase.
Cost of Acquisition vs Retention
Of course, it’s great to get new players through your doors. Rising acquisition is a clear indication that your website is working well and your offering appeals to players. However, compared to retaining them, it isn’t as valuable.
The more players you retain, the more money you’ll have coming in. Repeat users spend 33% more per transaction than your one off players. The trust they have in your business is palpable, so make sure you don’t let it go to waste. They will start to respond to the offers you put in front of them more as well, so their level of interaction with you will be higher than most too.
Players become increasingly more likely to continue to bet with you the more their amount of deposits increase.
High Player Retention Means More Loyalty
The more loyal your players are, the more likely they are to try out new aspects of your service. Compared to newer players, they are 50% more likely to try out new products that you release. So they may come for the football betting odds, and stay for the new online slots.
Garnering trust in your brand can mean a lot to other potential users. You need to build up a loyal player base to get this. The more someone uses your website or app, the more likely they are to become a brand advocate.
Establishing a community of loyal players creates an ecosystem where you have to do and spend less to increase wallet share. Your brand advocates will start to do some of the work for you and get new players onto your app for you.
Measuring Player Retention Rate
To make sure you’re on the right track, and stay on it, you should check in on your player retention rate often.
The formula below will help you calculate your player retention rate (PRR). It involves players you have at the start (S), at the end (E), and those you acquired during the period you are measuring (N). It should look like this: PRR = ((E-N)/S) x 100
You have 380 players at the start of the month. During that month you have gained 20 new customers, but you lost 13.
The number of customers at the end of the month = 387 (E)
The number at the beginning of the month = 380 (S)
The number gained during the month = 20 (N)
So, using our formula we get:
((387 – 20) / 380) x 100
(367/380) x 100
0.97 x 100
97% Player Retention Rate for the month.
Of course, businesses should always aim to keep their retention rate as high as possible. But the general rate is 85% or above. If it drops any lower then you need to start making some changes.
Best Practices
Your Data
When it comes to retaining players and doing it properly, you need to start off by getting to know them. That means what they play, how often they play, how much they spend on average, their win/loss ratio, and more.
Without knowing all of this, any player retention strategy you carry out is likely to fail. You can’t go in blind or else you will make some expensive mistakes.
Unifying your data in one place makes it much easier to build out player profiles. Understanding each player and their behaviours can help you power some really effective campaigns.
Once you build personalised campaigns and demonstrate how well you know them, you should see a boost in your level of player retention.
Choosing the Right Channel
Not all players have the same preferences when it comes to using your website or app. They play different games and bet on different things. The same comes to how they get to your app and interact with you.
Providing the best player experience comes all the way down to how they receive your messages. Some people respond to SMS the best, others respond to push notifications. Your data should tell you what segment prefers what channel.
Getting this right can significantly boost your rate of interaction. Sending a campaign to a player using the wrong channel means they are likely to miss that message. The more they miss your offers, promotions, or deals, the less time they will spend using your app or site.
We don’t want potentially loyal players to become borderline dormant.
Personalise Your Messages
At this stage it should go without saying, but some businesses haven’t fully wrapped their head around it yet. General batch and blast campaigns are simply not the way to go.
Players respond much better to messages that take their interests into account. If a player spends time betting on football and only football, they’re pretty likely to ignore a message with odds on the cricket world cup.
Store your data properly, understand your players’ preferences and tastes, use that information to send them personalised and relevant communications.
Now of course there is a little more work involved than just that, but that is essentially what is at the heart of it.
Nurture Loyalty
Players want to be recognised and rewarded by you. Addressing them personally when they go back on to your app or website and offering them a reward for staying with you will keep them happy.
Keeping players engaged comes down to the small things that show you do that extra little bit for them. They need to know that they are not just another player to you, but someone who matters to your business.
Congratulate them for their recent wins and send them something to cheer them up when they lose. Something like a free bet is always welcome.
The more you show you care about them, the more likely they are to stay.
Eyes on the Prize
Concentrating on player retention leads to better relationships and more value.
Even a 5% increase in your retention rates can lead to a 25%-95% increase in profits. So it is well worth putting your time and effort into.
Leverage your data, understand your players, and treat them well. It will have a very positive effect on your business.
If you want to know more about player retention and how omnichannel marketing can help your business, book a demo with our team today.
