What Does Google’s 2% Digital Tax Mean For Lead Generators?

Share Article:

As Google’s sets out to change the way digital tax works and puts the onus on the advertiser, LeadByte has a few tricks of the trade that can help lead generators to save money elsewhere using our software. Google has announced that they will be re-distributing the digital services tax fee in the United Kingdom to the advertisers. As of the 1st of November, any ads running on Google or YouTube in the UK will have the 2% charge applied. Giving businesses just over a month to prepare for the increase in costs. This inevitably increases costs for direct-to-consumer retailers as these companies have a strong dependence on the platform. The Guardian suggests that Facebook will follow suit, while eBay is said to continue absorbing the tax.

Advertisers have relayed to media outlets that the 2% tax levy will only apply to advertise spend on certain ads. Google Ads, Google Ad Network, and YouTube will have the tax added however, it will not apply to spend on DV360 or Google’s demand-side platform.

According to various advertising agencies, the 2% tax move was inevitable due to the structure of the UK’s unilateral approach to digital tax. The implementation of which has been a bone of contention between advertisers and the government. Lead generating companies will need to adjust their spending habits to adapt to the increase in fees and maximise on their ad spend.

How will this Affect your lead generation strategy going forward?
The chances are that this will definitely affect businesses’ lead generation strategy in the months to come, especially if Google is one of your main lead generation channels. Lead generators with Google Ads as their main channel will need to take swift action to adapt to the new tax rule. The best way to deal with it is to change your plans ahead of the tax change. LeadByte have already thought of some strategies to help you in the months to come:

There’s more than one way to skin a cat. So the saying goes, rather than spend the majority of your ad budget on Google, now would be a good time to branch into other avenues and spaces where you can advertise and market your product/service. Let’s say you only work on Google and with Google Ads and you are banned or blocked for one reason or another you are stuck. However, if you work with multiple platforms and you place your eggs in several baskets as it were, you can work with different platforms until the issue is resolved and continue to generate leads. In the next point, we highlight which platforms you may want to work with that will best suit your business.

Social media
This leads us nicely onto our next point, social media is an excellent way to reach your target market. Have your marketing and sales teams do some additional research. Find your where your ideal client spends their time online and tailor your marketing strategies to their platforms for that kind of client. There is a multitude of social media platforms that offer a variety of ways to market your service, namely: Twitter, Taboola, Instagram, Facebook, LinkedIn, the list goes on. Find out what works for you and go with it.

If you aren’t already, now is the perfect time to optimise the campaigns you have on Google. Identify those campaigns that are actually working and ensure those that are not being adjusted. Using lead management software is an excellent way to determine what campaigns are performing to maximise them. In the same way, see what campaigns are not working and optimise those to become more effective so you do not waste any money on failing campaigns. If you need assistance with this, you can use LeadByte for reporting so you can determine what sells and when in real-time. Our software will also enable you to have your leads validated so you don’t waste money sending our SMS and Emails to unchecked leads.

Nurture your leads and remarket
Save money in your ad budget by remarketing and nurturing old leads. If you don’t already have a lead nurturing system in place, then now would definitely be the time to invest in one. LeadByte offers businesses the opportunity to send automated, personalised bulk SMS and Email to leads at any time with the relevant opt-out options in line with the law. Through this system we also verify whether a lead is validated or not before sending out messages, saving you time and money in the long run. Ideally, you can then squeeze more ROI out of every lead, you can turn unsold leads into sold leads with the right message, thus, boosting your ROI as google seems to be making changes that might reduce it. This is simply one of the many ways a lead management software can assist with maximising on campaigns to save you money.

So while Google’s 2% tax is going to be a knock to the industry, there is a multitude of ways businesses can stay within their ad budget and still maintain the results they need for sales teams to hit their targets. If you are interested in learning more about how LeadByte can help YOU, please get in touch here or request a demo.



Share Article: