UK Tax changes put a greater burden on B2B Gaming Supplies
Highlights:
- With the UK Remote Gaming Duty rise, operators have to rethink their budgets and supplier relationships.
- There is increasing demand for B2B gaming companies to show business value.
The gambling tax on online gambling rose by 40 percentage points (from 21%) in April, which was the highest single rise in the gambling tax in the UK. The switch has already made operators think about costs, promotions and their overall stance in the market. This is also affecting suppliers that offer platforms, games, technology, analytics and other services to operators.
Fewer resources have to be devoted to investments, as operators are being more selective. While innovation and new functionality are still vital, suppliers are now being asked to show how their products can help deliver business outcomes. This can be anything from higher retention, higher LTV, enabling acquisition, or lower operating costs or better conversion.
Existing B2B contracts are also likely to be subjected to more scrutiny as operators seek efficiencies throughout their businesses. New projects might require a better commercial rationale in order to be invested in. The changing environment could therefore require suppliers to rethink how they position their products. In the B2B market, companies might need to highlight more of the link between their solutions and an operator’s financial goals, rather than the features or innovations of the B2B product.
Expectations are also higher for marketing teams – as well as traditional marketing functions like events, content and lead generation, commercial strategy and understanding customers/value proposition are all becoming more of a focus.
The need for suppliers to demonstrate business value for B2B business is likely to be a competitive factor in winning and keeping partnerships in the context of increased tax rates in the UK.
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