On May 14, 2018, the United States Supreme Court issued a ruling that struck down the Professional and Amateur Sports Protection Act (PASPA), effectively giving individual states the green light to decide for themselves whether they wanted to legalize sports betting within their borders. Fast forward to today, and sports betting is legal and fully operational in 17 states (plus Washington D.C.) with more making legislative progress toward legalization in the near future (Andrew Cuomo recently voiced his support for online sports betting in New York state). For the non-math majors like myself, that means that in a span of a little more than two and a half years, 35 percent of the country has made the decision to invest in the gambling industry, something that was widely considered taboo just a half decade ago. And people are jumping on board.
According to the American Gaming Association, Americans set a single-month record in October with an estimated $3 billion placed on legal sports bets, and sports betting revenue is up nationwide 53.5 percent year-over-year. As many Americans have become more comfortable with the idea of betting on sports, so have marketers. Brands and major sports leagues are leaning in, as well – last month, FanDuel, one of the country’s primary sports betting operators, announced a joint partnership with Bud Light that saw the sportsbook host the first-ever branded bet in the U.S.
I recently attended AdWeek’s Sports Marketing Summit and listened to a discussion that featured FanDuel CMO Mike Raffensperger, whose perception of the company’s identity is indicative of where FanDuel is headed with activations like the one with Bud Light as it attempts to break into the mainstream:
“We aren’t a gaming company – we don’t think of ourselves that way. We’re an entertainment company. We deliver entertainment through technology; that’s what we actually believe we do.”
When the sports shutdown at the onset of the COVID-19 pandemic threatened the daily fantasy sports and sports betting industries, FanDuel was forced to pivot. They did so by going all-in on finding alternate means of providing entertainment to their 6 million active users, something Raffensperger said quickly became the company’s main priority (ahead of paid activations and revenue).
FanDuel shifted their marketing plans and media spend and began to present its users with unique offerings like the first-ever free-to-play fantasy political games during a Democratic Presidential debate, betting on esports and reality TV shows like “The Bachelor,” and in-app streaming of international table tennis, horse racing and even Belarusian soccer.
Though FanDuel ventured into uncharted territory with its efforts in the spring, Raffensperger maintains that “stick-and-ball” sports are the overwhelming driver of the business and the core of the company’s identity. There was palpable excitement among Americans when sports resumed in the summer, and FanDuel capitalized by welcoming users back with an $80 million giveaway that served as an example of an effort to create engagement, which Raffesnperger says is the “entire purpose of (the) company.”
Evidence of Americans’ shifting attitudes toward sports betting can be found in FanDuel’s user activity. According to Raffensperger, FanDuel users spend more time in the app during NFL season than they do in apps like ESPN and Facebook. That type of engagement along with a business model that is, in Raffensperger’s words, “absurdly fan-focused,” inevitably leads to attention from brands and marketers.
It’s not always easy to pinpoint and capitalize on fundamental culture shifts as they’re happening, but FanDuel has done it, as have its brand partners, including Mountain Dew, Ford, Hulu, and, as of just several weeks ago, Bud Light, in a first-of-its-kind activation. Two and a half years from now, the list of brands and professional sports leagues who have invested in sports betting will undoubtedly be longer, likely by much more than 35 percent.