Jackpotjoy CEO: Bonus tax could help us attract stickier customers

The forthcoming UK tax on bonusing could help Jackpotjoy attract stickier customers and grow its market share, according to group CEO Andy McIver.

The company has been experimenting with ways to mitigate the bonus tax – which could yet be implemented in August – by tweaking its promotions on its Mandalay brand throughout Q1.

McIver said the bonus level on Mandalay had been cut from 75% to 50% over the last quarter, meaning for every pound received from players, only 50% was being handed back as bonuses.

As a result, Mandalay revenues dropped 15% year-on-year in Q1, but the McIver told EGR Intel on Tuesday the brand has returned to growth in April and May, as the reduced bonusing had positive knock-on effects.

“By cutting out the bonusing we are attracting a better quality of customer; one that sticks around a little longer, rather than one that is bonus obsessed. So that’s worked really well,” McIver said.

The former Sportingbet chief exec added that the overall impact of the bonus tax on the Jackpotjoy would be a 3-4% hit on margin, adding it could even help the firm increase its market share, thanks to the group’s general strategy, which places a heavier reemphasis on content and brand rather than bonusing.

There remains some confusion as to the actual implementation date of the so-called bonus tax thanks to the UK General Election, with McIver saying the firm is planning for an August implementation, although he personally expects it to be pushed back.