What is Player LTV in iGaming? Lifetime Value Explained
Player LTV is the net revenue an operator earns from one player over the whole relationship. Built on NGR, it sets how much an operator can spend to win and keep a player.
Player lifetime value (LTV) is the total net revenue one player generates for an operator from the first deposit to the end of the relationship. Operators build it from NGR, so bonus cost, taxes and fees are already deducted. LTV tells a CRM or VIP team how much it can spend to acquire, retain or win back a player.
Formula
- Historical LTV = sum of a player's NGR since the first deposit
- Simple predicted LTV = average monthly NGR per active player ÷ monthly churn rate
- LTV to CAC = LTV ÷ cost per first-time depositor
The simple predicted formula assumes a steady monthly churn rate. Its inverse, one divided by the churn rate, gives the average lifetime in months. Compute it by cohort, not for the whole base, because early cohorts and recent cohorts behave differently.
Example. A cohort earns €40 NGR per active player per month. Monthly churn rate is 20%, so average lifetime is 1 ÷ 0.20 = 5 months. Predicted LTV is €40 × 5 = €200. If cost per FTD is €50, LTV to CAC is 4.
How operators use LTV
Marketing teams compare bid limits and affiliate payouts with LTV. CRM teams split players into value tiers and give each tier a bonus and contact budget. VIP teams use LTV to rank players for account management.
LTV by acquisition source or first product shows which sources bring players that stay. LTV by cohort shows whether newer cohorts are worth more or less than older ones. Cohort tables are explained in cohort analysis in iGaming.
The same figure guides retention budgets. A bonus that costs more than the extra LTV it creates loses money. Test the effect with a control group, as in incremental lift.
Common mistakes
- Building LTV on GGR or on deposits. Neither shows what the operator keeps.
- One average for all players. Segment by value tier before averaging.
- Applying a constant churn rate to a cohort whose churn is high at the start and then flattens.
- Using LTV to push contact on players who show signs of harm. LTV never overrides a safer gambling decision.
- Reporting LTV from a short window as final. Young cohorts have not finished earning.
Related terms
Retention rate and churn rate feed the prediction. The article on casino VIP programs shows how value tiers are used. The Lifecycle Assessment reviews CRM, bonuses, loyalty, player journeys and channels.
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Order a diagnosticFrequently asked questions
What does LTV mean in iGaming?
LTV means lifetime value: the total value one player generates for the operator over the relationship. Use NGR as the value measure so bonuses, taxes and fees are already out.
Should LTV use GGR or NGR?
NGR. An LTV built on GGR overstates the value of players who receive large bonuses.
How is LTV used with acquisition cost?
Compare LTV to the cost of winning the player. The cost per first-time depositor must sit well below the LTV of the same cohort.
Is predicted LTV the same as historical LTV?
No. Historical LTV is NGR already earned. Predicted LTV adds an estimate of future NGR, so it needs a stated method and horizon.