FanDuel Looks To Extend U.S. Sports-Betting Dominance With Marketing Spend Advantage

November 21, 2022
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When FanDuel started to see marketing spend decline among its competitors following this year’s Super Bowl, the Flutter-owned company saw an opportunity to hit the accelerator, according to CEO Amy Howe.

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When FanDuel started to see marketing spend decline among its competitors following this year’s Super Bowl, the Flutter-owned company saw an opportunity to hit the accelerator, according to CEO Amy Howe.

The market leader in U.S. sports betting spent $727m in marketing costs through the first three quarters of 2022, per a presentation at FanDuel’s Capital Markets Day on Thursday (November 17) in New York.

“We saw competitors were pulling back in a much more dramatic fashion than you had seen in prior years, and so collectively, we made a very conscious decision to lean in,” Howe told investors and analysts.

“We knew some states were probably going to shift [their launch dates] to 2023 instead of 2022, so we said, ‘we’re going to make a conscious decision to lean in and exit the year with a bigger business’.”

FanDuel’s clear lead in U.S. online betting could now put the company in a more advantageous position when the time comes to extend its market-access agreements with casino operators, although FanDuel president Christian Genetski stressed the company was happy with its largest partner and minority owner, Boyd Gaming.

“We have a term on those agreements, I think it’s fair to say that FanDuel is in a position now that it wasn’t in 2018 when we were first negotiating some of those agreements, and that’s probably going to inure to our benefit,” Genetski said.

“But we also have partners that we like, where the relationship’s working, and we’re going to look to continue those partnerships.”

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The company has also targeted areas where it can improve, such as its live betting product, which accounts for almost a quarter of all FanDuel bets.

“I think, as an industry, we don’t well serve customers with live betting product experiences as we do for pre-live. I think a lot of that is because live betting inherited displays … that are designed for pre live, and they probably need a rethink, frankly,” said Conor Farren, FanDuel’s senior vice president of sports product and pricing.

“I think one of the challenges in the U.S. is that most people are watching 40 seconds behind live as well, which creates user experience challenges,” he added.

“When we do survey data, we rank best on live-betting experience. I kind of consider that result the ‘least bad’ at the moment; I think there’s a lot of improvements we need to make, so there is a long way to improve that.”

Another area where FanDuel outlined room for improvement was expanding its content offerings to include more first-run sports broadcasts.

Chief marketing officer Mike Raffensperger acknowledged that FanDuel’s app or newly rebranded FanDuelTV, the former TVG network, is not likely a fit for major American sports leagues.

“I think in any immediate or even midterm future, there are better homes for major American sports, they can monetize it through other means and have a more mainstream audience than, let's say something that's specifically oriented towards betting,” Raffensperger said.

“But I do think there are secondary and tertiary sports leagues that just can’t find good fanbases in the United States and they can’t find good distribution homes and we’ve found them really eager to work with us where we have millions of super engaged sports fans that we can help them grow their league.

“That creates a really interesting economic model where we can share in the growth of the sport together and so my hunch is you can see us operate and be investing in ways where we can make incremental fandom and incremental betting opportunities in secondary and tertiary sports.”

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