The rising cost of acquiring new online players is forcing operators in Asia to ramp up their customer relationship management (CRM) capabilities in a bid to build deeper bonds and gain more value from existing customers.
Marketing teams at online operators have long been fixated on all important CPA numbers — that is the cost per acquisition of a new player.
This figure varies dramatically between markets and tends to be a closely guarded secret among operators, but AGB understands it stands around US$250 for a new online casino player in a mature European market, and around half of that for a new sportsbook player.
CPAs in Asia’s grey markets will be lower, but they are on the rise — as evidenced by the growing marketing spend of Asia-facing online operators on display every weekend on the shirts of many major English football clubs.
And as CPAs rise, it is becoming increasingly important for operators to shift focus from acquiring new players to ensuring the lifetime value of already acquired players is optimized.
“Due to the fact that cost of acquisition keeps on rising, and as competition becomes fiercer, operators must be creative with maximizing the ROI from the existing database, and as such retention is the new king,” Shahar Attias, founder of Hybrid Interaction Ltd. and an igaming expert with nearly two decades of experience in player retention and online casino VIP programmes, told AGB.
This requires something of a culture change for operators, many of which had previously enjoyed success by following a cheap acquisition, low-lifetime value model.
Nick Hill, commercial director at online supplier Flow Gaming, said this approach has meant players in Asia are less likely to display loyalty towards a particular operator.
“Up until now, the model many have used has been acquisition driven and with no retention methods in place,” Hill told AGB.
“They have been shooting fish in a barrel, which has led to a bonus hunter mentality among players – they go from operator to operator taking advantage of overly-generous promotions. Simply put, there is no loyalty.”
Changing this is no easy task. Attias said that because most Asian online markets are not regulated, the levels of trust between operators and users are not as high as in regulated European jurisdictions
As such, he added, players tend to share less information about themselves, making it tougher for operators to apply usual CRM practices.
In a bid to build loyalty, trust, and ultimately a stronger relationship between brand and customer, operators are turning to increasingly sophisticated tools that allow them to optimize the value of each player.
“Operators [in Asia] are only just starting to learn how to use the incredible tools available to them; features that European operators have been leveraging for several years now,” Hill said.
“Asian operators are slowly embracing these tools, and using them in conjunction with smart retention strategies – up until now they have been purely focused on acquisition,” Hill added.
Among the tools Flow Gaming offers operators is a possibility for operators to build bonuses across all content by supplier, game, player group (first deposit, frequent player, VIP) geolocation or affiliate, all from a single place.
The power to personalize and tailor bonuses to groups of players, or even individual players, has been an extremely powerful CRM tool for many of Europe’s most successful operators over recent years, and is beginning to become more common in Asia.
On top of content and infrastructure, platform provider SA Gaming supplies operators with a back office of tools that enables them to predict trends within a customer base and market to them accordingly.
“SA Gaming believes that the future of igaming is tied to personalization, effective data and marketing tools and successful CRM,” an SA Gaming spokesperson told AGB
The supplier added that it offers technical assistance to operators around seasonal promotions and bonusing, particularly when it comes to retaining high-spending customers.
The future of retention
Putting data at the heart of marketing strategies is not a new phenomenon, but the next step for operators will be to begin to automate the process.
While this is rare in Asia, it is now commonplace in Europe, with artificial intelligence driving marketing campaigns that can react to customers in real time.
“The use of artificial intelligence in igaming marketing is already revolutionising the way operators interact with customers,” Adi Dagan, CEO of data-driven marketing platform Beehive, told AGB.
“Standard CRM teams are simply not capable of processing the sheer volume of data manually, but by using artificial intelligence to help automate this process, a lot more becomes possible. It is essentially allowing operators to provide the personal touch to all customers that was previously reserved only for VIPs,” Dagan added.
This ‘VIP for all’ approach to marketing has become the gold standard for operators. But Attias notes that as far as Asia-facing operators are concerned, there is still a clear need to shift into mass-scaling CRM.
He adds that the mobile channel may be the best way to facilitate the problem of trust, with the potential for operators to use tools such as WeChat and WhatsApp to ensure a player’s privacy isn’t compromised while at the same time offering a personalized offering.
It could be that increased competition is the driver of more intelligent and focused retention strategies, according to Hill at Flow Gaming, with operators increasingly concerned about seeing players “walking through the digital doors of their rivals”.
“It boils down to educating operators on how to better understand their players, and what makes them sticky,” said Hill.
“The real challenge moving forwards will be in encouraging operators to rip up their current strategies, and dial in on retention. This will help them form strong bonds with their players, who in return will remain loyal to their brands/sites.”
As Asian igaming markets begin to mature, it will ultimately be the operators successfully pivoting their marketing expertise from acquisition to retention that thrive.
Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.
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