LTV (Lifetime Value)

How it's calculated

The formula most used in iGaming is:

LTV = average monthly ARPU × average player lifetime (in months)

ARPU here must be net — calculated on the NGR a player generates, not on turnover. A round-number example: if a player generates R$ 150 in average monthly NGR and stays active for 8 months before churning, that player's LTV is R$ 150 × 8 = R$ 1,200. Multiplied across the players acquired in a given period, this number sets the ceiling for how much the operation can spend on acquisition without eroding margin.

A stricter version discounts for the cost of servicing the account (KYC checks, support, payment processing) and applies a discount rate, but for marketing decisions the simple formula is usually enough — the point that cannot be skipped is using net revenue, never gross turnover.

Why a handful of players dominate LTV

LTV only means something read next to CAC (Customer Acquisition Cost). An LTV:CAC ratio below 1 means the operation loses money on every player it acquires; above 3 usually signals room to invest more aggressively in acquisition.

In iGaming, though, average LTV hides a very uneven distribution: a small minority of high-value players accounts for most of the revenue, while most players generate little or nothing after their first deposit. That means the base-wide average LTV can be misleading — two operators with the same average LTV can carry very different risk profiles, one dependent on a handful of VIPs and the other with revenue spread more evenly. Segmenting LTV by deposit tier (casual, recurring, VIP) produces sharper acquisition and retention decisions than reading the base average alone.

Do rollover and bonuses distort apparent LTV?

Yes, and it's one of the most common mistakes when calculating LTV. A player who deposits repeatedly to claim welcome or reload bonuses, clears the rollover by wagering the minimum required, and then withdraws the balance shows up in a raw report as an active, engaged player — but the real NGR they generate can be close to zero, or even negative, because the bonus cost outweighs the retained margin.

That's why LTV should be calculated on post-bonus, post-rollover revenue, never on deposits or gross wagers. Skipping that adjustment inflates projected LTV artificially and leads to overpaying for acquisition relative to what a player is actually worth.

LTV vs. GGR per player

The gap between total GGR and LTV reflects exactly the bonus costs, affiliate commissions, and payment fees that separate gross revenue from what the operation actually captures.