The Trust Department (DoT) recently released an analysis based on original bank transaction data, indicating that player churn is becoming an unavoidable challenge for UK gambling operators. The study focuses on the retention performance of new players and the overall churn rate of active users, while questioning whether operators have taken sufficient measures in user retention.
In the context of LiveScore Group withdrawing from the Dutch market, this report becomes even more relevant.
The DoT analysis covers the bank transaction records of 778,241 users (including deposits and withdrawals related to gambling) from the first quarter of 2023 to the fourth quarter of 2024, involving 349 licensed gambling brands in the UK.
The analysis first focuses on whether new users are still entering the market in large numbers. The study traces the behavior of active users since January 2023, focusing on assessing how many of the players who placed bets in the fourth quarter of 2024 were "new players" appearing for the first time.
Limited retention of new players
The data shows that in the fourth quarter of 2024, only 6.19% of active players were new users making their first gambling transaction, while "long-term active users" (those who have transacted multiple times within two years) accounted for 58.8%.
Here, "new players" are defined as users who have not made any gambling transactions since January 2023, meaning they were either long-term inactive or first-time participants in gambling. The data clearly shows a downward trend in the total number of gambling users, with a significant reduction in the proportion of new users compared to the first quarter of 2023.
Further analysis focuses on a narrower definition of new users—those who make their first transaction in a quarter and have had no deposit activity in the past three consecutive quarters. For example, if a player makes their first deposit in the fourth quarter of 2024 and had no related transactions in the first three quarters of 2024, they are considered a "quarterly new user."
This analysis sample is based on users whose bank data can be continuously tracked for two years.
Note: Due to this stricter definition, the proportion of quarterly new users is slightly higher than shown in the table above. However, the trend remains clear: between the fourth quarter of 2023 and the fourth quarter of 2024, the proportion of quarterly new users decreased from 14.57% to 10.7%. Considering that some users may have been inactive for a long time before re-engaging in gambling, the actual proportion of "true new users" may be even lower.
Pace of user churn
Operators can track the active duration of players on their platforms, but it is difficult to determine whether they have switched to other platforms or completely left the gambling market.
To measure the overall churn rate, DoT selected a group of users who participated in gambling in the first quarter of 2023 and tracked their last gambling transaction by the end of 2024. Although it is not possible to know when they first participated in gambling, the termination behavior reflects their tendency to churn.
The results show that by the fourth quarter of 2024, 63% of the Q1 2023 players were still active on at least one licensed gambling platform, indicating an accumulated churn rate of about 37%. In other words, about 1.5% of long-term users stop gambling activities or switch to unlicensed platforms (untrackable) each month.
Poor short-term retention performance of new users
For those new players who started transactions in the fourth quarter of 2023 (having had no deposits for at least three consecutive quarters prior), DoT tracked their activity changes over the next four quarters.
The data shows that about 30% of new users stop gambling after their opening quarter, and 65% of new players churn within a year.
This means that although new users enter the market every quarter, only one-third may become continuously active, with most players stopping or only occasionally participating in gambling within a year.
Several CRM (Customer Relationship Management) experts point out that this high short-term churn rate is not surprising. Some new users tend to switch platforms after utilizing registration bonuses, a practice known as "bonus arbitrage," which increases retention costs and has limited effectiveness.
Therefore, although the overall number of users tends to stabilize, the core competition among operators has shifted towards competing for "wallet share."
Intensified competition for wallet share
"Wallet share" refers to the proportion of a player's total gambling expenditure that a particular operator captures. DoT studied the data for the fourth quarter of 2024, analyzing players' expenditures during a quarter and the number of operators they collaborated with.
Expenditure refers to net deposits, i.e., the total deposits made by players across different platforms minus total withdrawals, excluding account balances.
The data indicates that the more active platforms a player has, the higher the expenditure each operator receives from the player. This suggests that users tend to create new accounts when they want to play more games, rather than continuously increasing stakes on a single platform.
A significant finding is that nearly 60% of players had four active accounts in a single quarter, while only 20% of players collaborated with just one operator. This further highlights the importance of wallet share and the complexity of operators acquiring and maintaining user expenditures.
Previous studies by DoT also revealed differences in gambling behavior between men and women in the UK: men's average gambling expenditure is significantly higher than women's relative to their monthly income, showing structural differences in participation frequency and spending capacity among different groups.
