Dutch iGaming: Growing Through Regulation

As the iGaming industry continues to expand around the globe, newly-regulated markets are constantly emerging, offering great new opportunities for growth. 

The Netherlands is one of the most recent jurisdictions to regulate online gaming and many operators are keen to take advantage of this opportunity for expansion. But this also comes with its own unique set of challenges. 

Some industry commentators, for example, believe that newly proposed, strict regulations on advertising and consumer interaction will severely limit the level of market competitiveness and indirectly encourage increased unlicensed betting activity.

We caught up with Henk Wolff, Chief Marketing Officer at Blitz Casino to hear his thoughts on the future of Dutch iGaming regulation and the key question of whether growth can still be achieved in the face of tightening marketing legislation. 

The newly launched Dutch online gaming market has been subjected to a very rigorous set of regulation. What impact do you think this will have on the type of companies and products that will enter the market? And how will it impact the range of customer choice?

“I think most of the impact will be decided on how well the regulator will punish, or restrict, the non-licensed bodies. I expect to see more grey area affiliates and dodgy methods of advertising, such as pop-on ads on websites that aren’t even compliant with the law to begin with. Prime examples can be seen with streaming websites for UFC matches.  I think that is going to change for sure and depending on the method of which the regulator will restrict websites such as affiliate websites or bad-market online casinos, punishing them accordingly, it will definitely impact customers’ range of choice for online casinos. 

“I’m really glad that most of the current licenced casinos have already established their brand identity and are more top-of-mind than the non-licenced operators. I still sustain my point that casinos should be able to advertise, and, in this market, I still completely stand behind the method of setting up advertisement rules, instead of just giving a complete ban. I would hate to see in the future, the dark side of these set of regulations, because there will be a lot of players that go to a non-licenced casino.”

Many industry commentators believe that transparency between operators and a regulator is the best way to ensure a healthy, sustainable market. Do you think that the KRUKS data sharing initiative is the best way forward? Or is there more that can be done to achieve this goal?

“I think in its current state the KRUKS is efficient enough to facilitate improved operator- regulator relationships. However, I do believe that every market evolves, and that products need to evolve as well. The market will gain more traction. Even markets that have been regulated for years still have hiccups. I think KRUKS will need to be very flexible. The true issue is the challenge for an operator to ask for a change from their white label providers. That is extremely hard, and it’s very time consuming. 

“The regulators should keep in mind that operators cannot make sudden changes very easily. If the KRUKS system is going to change, it should be mainly on the side of the regulations – and not so much on the side of the operator. I think that is a big, big challenge. I believe that  KRUKS in the current setup is sufficient enough. But, as with everything else, it will have to keep pace and constantly evolve.”

What impact do you think the recently proposed advertising bans will have on the Dutch market? Will brands still be able to achieve sufficient market exposure to remain competitive? And, if so, how? 

“There’s a lot of operator friends of mine who are talking about this. I think there’ll be increased competition on search ads, which may result in extremely high CPA’s, depending on how much they’re going to compete with each other. I think affiliate marketing is going to be even more important in a Dutch market. The new advertising restrictions are going to make it quite comparable to how a non-licenced casino actually penetrates a market. 

“This is the reality of what licensed casinos now have to do, which, in my opinion, is quite strange. It will definitely be harder for acquisition. But I think top-tier content is going to make the change. Think about top-tier content on YouTube: where a consumer actually wants to consume the content, rather than see an advertisement. Think about sports betting tips, or maybe even our own show that talks about matches on a Sunday. I think that is going to be very big. And that’s how I would do it.”

Some industry commentators believe that the latest stats regulations represent an imbalance between player protection measures and the level of market competition, how will it create an increased risk of bad-market activity? And how do you think that balance can be improved going forward?

“I think it will require a lot of transparency on both sides. To ensure the best methods of player protection, I would love to see a new and improved set of advertising rules rather than just completely banning it. The thing is, even stakeholders are already trying to influence this. In the Netherlands, they have just launched a digital stamp for affiliates to show that they are obedient to national regulations. This a great step forward as before you can have this stamp, you have to go through an entire process. 

“However, there’s still this issue. As an affiliate, you can have this stamp on your website as a way to build trust. But bad-market affiliates can easily copy and paste the image. If I was a consumer, I would never even consider checking its validity, I would just click. So, it requires a lot of communication with the regulator and the operators –  and not just the biggest operator, but even the smallest ones because they’re all in this market. They all have their own vision. It can be time-consuming. But I firmly believe this type of open communication is the key.”

Can you name an iGaming jurisdiction around the world that you think has a well-structured regulatory framework? What key features from them do you think the Dutch market should adopt to ensure a sustainable market?

“There are so many iGaming jurisdictions already, and I think there’s constantly new ones coming up. I think every country has had–or will have–hiccups, but we’re just in a very early stage. It might take two or three, maybe five, years for the bigger countries to adapt to the new rules, then we can realistically talk about which market has the best regulatory framework. Right now, I think we’re still a relatively immature market. Other Western European countries, such as Germany and Sweden, only opened up recently, throughout 2019, while UK iGaming has been established for many years.”

Editor’s note:

Speaking with Henk, it’s clear to see that the proposed advertising bans will be limiting for operators. But, crucially, if we change the way we, as an industry, think about marketing and acquisition, there’s still plenty of opportunity.

Henk believes that creating content of real value will be the key to success. No longer can we rely on big bonuses and expensive adverts to bring in the punters. Now is the time to really understand what our customers need and want to engage with. Being able to incorporate these into fun, interactive content will be paramount to forging future success.

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