FanDuel currently holds a 50% market share in the US sports betting market, solidifying its position as the industry leader. It maintains a significant lead of 10-20% in nearly every US betting market and shows no signs of relinquishing its dominance.
While FanDuel takes the clear No. 1 spot, DraftKings is positioned as the clear No. 2 in the market. Although DraftKings was born in Boston and maintains its headquarters there, there is no compelling reason to expect that Massachusetts alone will propel DraftKings to the top spot in sportsbook earnings.
Ultimately, what matters most to bettors in Massachusetts is not where DraftKings was founded, but which sportsbook brand can provide them with the best experience. In terms of competitiveness and market development, FanDuel has maintained an edge that DraftKings has yet to replicate or surpass.
When it comes to sports betting in Massachusetts, it is the sportsbook that can effectively attract and serve bettors that will hold the most appeal, rather than the location of the company’s origin.
Early FanDuel victories
Part of the reason why FanDuel has a significantly higher market share than its competitors is due to the nature of the online sports betting market. During the November Money Markets Day (CMD) conference, Flutter Entertainment CEO Peter Jackson pointed out a similar pattern in other digital sectors, where one company dominates a significant portion of the market share while other companies compete for the remaining share.
For example, in the streaming industry, Netflix has a market share that is 0.7 times greater than Prime Video. Lyft holds only 2.6 times the market share of Uber. Similarly, Spotify has 2.1 times the market share of Apple Music. These examples demonstrate the trend of one company capturing a larger portion of the market compared to its competitors.
In the case of FanDuel, it has successfully positioned itself as the leader in the US sports betting market, capturing a significant share of the market compared to other sportsbook operators. This dominance can be attributed to various factors such as brand recognition, marketing efforts, user experience, and competitive pricing.
Further, FanDuel made ideal decisions which snowballed in greater positive aspects. The greatest variables in FanDuel’ s industry dominance include things like its:
- Early on launch involving Same Activity Parlay product or service
- Customer get and preservation abilities
- Advertising spending tactic
SGP early roll-out
“We were the first ones to introduce both Same Game Parlay and Same Game Parlay Plus, and… 86% of our active bettors last year placed a parlay bet,” Alexander Pitocchelli, Director of Marketing at FanDuel, told PlayMA. “So that was a huge win for us, especially during football season, which is one of our busiest times.”
Parlays are profitable for sportsbooks because each leg of the parlay reduces the likelihood of the parlay winning. This allows FanDuel to generate more revenue on increasingly unlikely bets. Being the first to market with Same Game Parlays (SGPs) gave FanDuel an early advantage in terms of profit margin. It earned more money than its competitors through this popular bet type, which could be reinvested to enhance its risk management and potentially enable the company to accept even more liability. Five years into the legal US betting market, being the first to market with this high-margin product has resulted in a revenue advantage for FanDuel.
Buyer acquisition together with retention
PlayMA has previously reported on FanDuel’s exceptional ability to convert its existing daily fantasy sports (DFS) customers into sportsbook customers. FanDuel’s CMD presentation provided a more detailed look at how its customer conversion process works.
According to the presentation, 25% of FanDuel’s customers come from referrals, which not only scales with FanDuel’s customer base but also costs 60% less than its other customer acquisition methods. However, this does not fully explain FanDuel’s initial advantage in customer acquisition.
What will come closer to telling you is FanDuel’ s development in its transmission with every single legalization samsung s8500. Here is FanDuel’ s malfunction of the amount of the grown-up population that converted to it is app twelve months into every single wave involving sports betting legalization:
| 2018-2019 | 1 ) 8% |
| 2020-2021 | 3. five per cent |
| 2022 | 5. 4% |
FanDuel hasn’t only grabbed more buyers over time, nevertheless it has also been given to them quicker. This is an alternative strategic expenditure with increasing returns. Developing customer get speed presented FanDuel some sort of head start throughout new market segments, giving it even more customers to build more testimonials.
Advertising spending tactic
The standard first bet bonus is a common promotional offer for many Massachusetts sportsbooks. However, FanDuel automatically sends 95% of its bonus offers to customers, eliminating the need for additional staff and reducing the time and cost associated with attracting customers back to the app.
By not having to allocate extra funds towards these expenses, FanDuel can reinvest the additional revenue into improving its risk-management systems, thereby enhancing its margins and reducing customer retention costs. This financial growth effect gives FanDuel a long-term cost advantage, which is a significant factor contributing to its strategic successes.
FanDuel’ s industry position above DraftKings
In the book “Good to Great,” Jim Collins discusses the concept of the flywheel effect, where small victories accumulate to create greater advantages over time, similar to how a heavy flywheel gains momentum the longer it is pushed.
Over the past five years, FanDuel’s early successes helped secure its position as the market leader. In markets like Indiana, where DraftKings launched slightly earlier, DraftKings initially held the top spot but was eventually overtaken by FanDuel after two and a half years. FanDuel’s early strategic wins eroded DraftKings’ initial advantage, demonstrating the keys to long-term competitiveness in the online sports betting industry.
Which will hold authentic for FanDuel Massachusetts throughout DraftKings’ lawn, too.
Christopher Gerlacher is a contributing writer for PlayMA. He is a versatile and knowledgeable writer with a portfolio that ranges from politics and legislative pieces to sports and betting. Gerlacher is a devout Broncos fan, for better or for worse, living in the foothills of Arvada, CO.
