LTV (Lifetime Value) is the expected net revenue from a player across the whole relationship. It is the number that sets the ceiling on acquisition spend.
In iGaming three particularities complicate the calculation:
- Extremely skewed distribution. A small share of the base accounts for most of the revenue. Average LTV, without a median and without segmentation, hides this and drives wrong acquisition decisions.
- Long, uncertain horizon. LTV models extrapolating from a few weeks tend to overestimate. It is safer to work with observed LTV over a fixed window, 90, 180, 365 days, and compare cohorts in the same window.
- Bonus cost. LTV that ignores the promotional cost attributed to that player is not net of anything.
The most actionable reading is not absolute LTV but the ratio of fixed-window LTV to CAC per channel, which answers whether it is worth continuing to buy in that channel.
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