GGR vs. NGR: Choosing Your Revenue Base
The single most important decision in your iGaming affiliate program is how you define "revenue" for commission calculations. This decision affects every affiliate deal you negotiate, your margin on every player, and how attractive your program appears to potential partners.
Gross Gaming Revenue (GGR)
GGR is the simplest calculation: total player bets minus total player winnings. If a player bets $10,000 and wins $9,200, the GGR is $800. This is the raw revenue before any deductions.
When you offer RevShare on GGR, affiliates receive a percentage of this gross figure. The advantage for affiliates is transparency: GGR is easy to verify and hard to manipulate. The disadvantage for operators is that GGR does not account for the real costs of generating that revenue.
Net Gaming Revenue (NGR)
NGR starts with GGR and subtracts direct costs. The specific deductions vary by operator, but typically include:
- Bonuses and promotional costs given to the player.
- Platform and game provider fees (royalties to slot providers, live casino fees).
- Payment processing costs (deposits and withdrawals).
- Gaming taxes and licensing fees allocated to that player.
- Jackpot contributions (for progressive jackpot games).
The items you include in NGR deductions directly affect affiliate trust. If you deduct too many costs, affiliates will perceive the deal as unfavorable and go to competitors. Always document your NGR formula in your affiliate agreement and be transparent about what is deducted.
Comparing the Two Models
| Factor | GGR | NGR |
|---|---|---|
| Transparency | High - simple calculation | Medium - depends on deductions |
| Affiliate appeal | Higher - bigger revenue base | Lower - reduced base |
| Operator margin | Lower - pays on gross | Higher - pays on net |
| Industry standard | Less common | More common in mature markets |
| Dispute risk | Low | Higher - deduction disputes |
The Negative Carryover Question
In any month where players win more than they lose, the GGR (or NGR) for those players goes negative. This raises a critical question: does the negative balance carry over to the next month?
With negative carryover, if a player generates -$500 in January and +$300 in February, the net is still -$200, and no commission is paid. Without negative carryover, January is treated as zero (no commission, but no debt), and February pays commission on the full $300.
Most affiliates strongly prefer no negative carryover. If you insist on negative carryover, expect to compensate with higher RevShare percentages. Many operators use no negative carryover as a competitive advantage in affiliate recruitment.
Practical Recommendation
For new programs, starting with NGR-based RevShare is typically the safer choice. It protects your margin while still offering competitive rates. Define your NGR formula clearly, limit deductions to genuine direct costs, and consider offering no negative carryover to attract quality partners. You can always adjust rates up or down as you gather data on player LTV and affiliate performance.
Key Takeaways
- GGR is bets minus winnings. NGR is GGR minus direct costs like bonuses, taxes, and fees.
- NGR protects operator margin but requires transparent documentation of deductions.
- Negative carryover policy is a major factor in affiliate program attractiveness.
- Start with NGR, document your formula clearly, and consider no negative carryover.
Explore Further
Key terms and tools related to this lesson. Deepen your understanding and see how Track360 supports these concepts.
NGR (Net Gaming Revenue)
NGR is the revenue that remains after an operator deducts costs such as bonuses, taxes, and platform fees from GGR. It is a common base for RevShare calculations in iGaming affiliate programs.
GGR (Gross Gaming Revenue)
GGR is the total amount wagered by players minus the total amount paid out as winnings. It represents the raw revenue an iGaming operator earns from player activity before any deductions for bonuses, taxes, or operational costs.
Affiliate Program
A structured partnership where a business rewards external partners (affiliates) for driving traffic, leads, or conversions through tracked referral activity.
Affiliate Manager
An affiliate manager is the operator-side role responsible for recruiting, onboarding, managing, and optimizing affiliate partnerships within a partner program.