Why You Should be Focussed on Driving Player Loyalty…

I’m obsessed by building sites that keep players engaged, and here is what I’ve learned about the importance of loyal players.

In the fast-paced world of online competitions, it's easy to get caught up in the excitement of acquiring new players. But here's a sobering thought: in our industry, the Customer Acquisition Costs are high, while the Average Order Value is low, and our gross margin hovers around 50%.

Let me break that down for you:

• Customer Acquisition Cost (CAC) is all the money we spend on advertising and marketing to bring in a new player. This includes social media ads, Google ads, influencer partnerships, and any other promotional activities. We're spending between £10 to £25 just to get one new player to our site.

• Average Order Value (AOV) is the typical amount a player spends when they make a purchase. In our industry, this is around £8.

• The 50% gross margin means that out of that £8, about £4 is actual profit before we account for our other operating costs.

Let that sink in for a moment.

It means that for many businesses, it takes multiple purchases just to break even on a new customer. Yet, shockingly, many competition sites acquire hundreds or even thousands of customers who only ever play once. These players come to the site, lose on their first attempt, and then vanish, never to return.

This isn't just a missed opportunity—it's a financial drain that can seriously impact your profitability. You're potentially spending £25 to acquire a customer who only ever generates £4 in profit. It's clear to see why focusing on player loyalty is so crucial for the long-term success of your business.

The True Value of Loyal Players

Loyal players are the lifeblood of a successful competition business. They're not just more cost-effective to retain than new players are to acquire; they're also more likely to:

1. Participate in multiple competitions

2. Spend more per transaction

3. Recommend your site to others

4. Provide valuable feedback for improvement

In essence, loyal players are your path to sustainable profitability.

Things to Try:

1. Implement a 'Game Streak' Feature: Reward players for consistent participation. This could be bonus entries, discounts, or exclusive access to special draws.

2. Loyalty Points Programme: Assign points for various activities (playing, sharing, referring) that can be redeemed for rewards or entries.

3. Personalised Messaging: Reach out to players after their first game, win or lose. A simple "Better luck next time" or "Congratulations!" can go a long way.

4. Exclusive 'Members Only' Draws: Create a sense of belonging and exclusivity for your regular players.

5. Conduct Regular Surveys: Ask your players what they want. Use this feedback to tailor your offerings.

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The Givewaze Advantage: At Givewaze, we understand the critical importance of player loyalty. That's why we've built features specifically designed to boost retention and engagement:

1. Built-in 'Game Streak' Feature

2. Automated Personalised Messaging

3. A/B Testing Tools

4. Advanced Analytics

The Power of A/B Testing

Speaking of A/B testing, it's a powerful tool that's often underutilised in our industry. By systematically testing different aspects of your competitions—from prize structures to messaging—you can continually refine your offerings to maximise player engagement and loyalty.

For instance, you might find that your players prefer multiple smaller prizes over one large jackpot, or that they engage more with limited-time flash draws than longer-running competitions. Without testing, you're essentially flying blind.

Things to Try:

1. Test Different Prize Structures: Compare the engagement rates of single large prizes versus multiple smaller ones.

2. Experiment with Entry Prices: See how different price points affect both new player acquisition and repeat play.

3. Try Various Competition Durations: Do your players prefer quick, frequent draws or longer-running mega competitions?

4. Test Your Messaging: Experiment with different tones and styles in your communications to see what resonates best with your audience.

The Givewaze Advantage: Our platform makes A/B testing a breeze. With built-in tools and analytics, you can easily set up tests, track results, and implement winning strategies—all tied directly to your key business metrics.

Real-World Examples: The Impact of Player Loyalty

Let me share two contrasting examples from businesses we've consulted on over the past few years. These cases highlight the stark difference player loyalty can make to your bottom line.

Example 1: High Turnover, Low Loyalty

• 300,000+ players

• £1 million/month turnover

• Only £150,000/month gross profit

• Constantly churning through thousands of one-time players

• Heavy reliance on continuous customer acquisition

This brand had impressive numbers on the surface. However, their over-reliance on customer acquisition meant sky-high marketing costs, eating away at profits. They were spending a fortune to bring in new players, most of whom would play once and never return.

Example 2: Smaller Base, Higher Loyalty

• 60,000 players total

• 25,000 active, regular players

• £250,000/month revenue

• £125,000/month gross profit

• Focus on player retention and engagement

• Lower marketing costs due to repeat business

Despite having a much smaller player base and lower revenue, this business achieved nearly the same profit as the larger company.

Their secret?

A loyal, engaged player base that kept coming back. By focusing on retention, they significantly reduced their marketing costs and created a more stable, predictable revenue stream.

It’s not the size of the dog in the fight, but the size of the fight in the dog…

It's not about how many players you can attract, but how many you can keep. A smaller, more loyal player base can often lead to greater profitability and long-term success. This second business model is not only more profitable but also more scalable and sustainable in the long run.

The Givewaze Advantage: At Givewaze, we've built our platform with these lessons in mind. Our suite of tools is designed to help you foster player loyalty from day one, turning one-time players into loyal, repeat customers. From our 'Game Streak' feature to advanced analytics and A/B testing capabilities, we provide everything you need to build and maintain a loyal player base.

Ready to transform your competition site into a loyalty-generating machine? Let's talk about how Givewaze can help you achieve the success of our second example, creating a more profitable and sustainable business model.