Better user retention equals more profits
There is plenty of research that proves that increasing client retention impacts profitability. But in spite of this many companies are still not taking action on this front or allocating budgets specifically to customer retention.
Here are some amazing facts about how retention impacts profitability and some ideas on how to leverage them:
“Businesses have a 60 to 70% chance of selling to an existing customer while the probability of selling to a new prospect is only 5% to 20%.”
From the Book Marketing Metrics
This statistic should inspire action on two fronts, retention and reactivation. This metric shows us that if you invest the same time and effort into retaining customers and reactivating them to keep them playing on your site, your ROI could be as much as 65% higher than your current acquisition efforts.
It’s difficult to shift perceptions, because acquisition is always everyone’s number one concern in iGaming, but perhaps it’s time some acquisition budgets were redirected to retention and reactivating your existing customer database.
A 2% increase in customer retention has the same effect as decreasing costs by 10% from an article on the Huffington Post
This metric begs for attention. A mere 2% increase in customer retention is equivalent to a cost cutting exercise that results in a 10% cut in expenses. How much time does your team spend trying to lean out expenses?
Imagine you could remove the need for cost-cutting by simply investing this time into client retention and reactivation strategies. Wouldn’t that tip the balance in your favour really easily?
Can you beat the 2% retention rate presented above? Chances are by redirecting some time to this you can do it pretty easily.
eCommerce spending for new customers is on average $24.50, compared to $52.50 for repeat customers – McKinsey.
When players are new to your website, they’re going to buy more cautiously. The main reason for this is that trust takes time. Even with self-service websites that don’t require much merchant interaction, it takes a couple of purchases or deposits for a customer to start trusting you.
In iGaming this is closely related to the customer experience. A great customer experience across the entertainment sections and the payment process are key. However even when you do a great job at this, repeat customers will spend more.
So make sure you spend some extra time and invest some TLC into retaining your players and bringing back those people that are already in your database but are currently not playing. These people have trusted you with their money already, if you can bring them back and keep them as long as possible, you will benefit from higher purchases which will increase your average player lifetime value.
Let’s discuss the real figures you can expect to see if you hire our revenue share (Re)Activation services.
At Enteractive, we offer revenue share (Re)Activation services to get your high lifetime value players to come back to your site.
Contact our Head of Business Development Andrew Foster to find out how we can help retain more players for you.