DraftKings stock is up nearly 35% this year ahead of Sunday’s big game in Tampa. The stock is up nearly 260% since going public last April after going public with a special purpose vehicle (SPAC) for the purpose of taking blank checks (SPAC). This is the third Super Bowl since the state-level Supreme Court legalized sports betting in 2018. Several states have since approved measures that allow bets to be placed in physical locations (known as sports bets) as well as through online betting. That said, 2021 could be the best year yet for the gambling giants.
DraftKings isn’t the only company benefiting from the wave of legalized sports betting in the US.
“Demand is off the charts,” said Matt King, CEO of FanDuel, in an interview with CNN Business Thursday. “This will be the biggest event in the company’s history.”
Football fans in more than two dozen states and Washington, DC can now legally bet on sports online, via mobile apps, or in person at licensed sports betting.
“The most important change is the growth of our available customers,” said Jason Robins, CEO of DraftKings.
For the 2019 Super Bowl, Robins said, DraftKings could take bets from users in just one state: New Jersey. Last year the app went live in five states. Now it’s until 12.
Meet the two players who dominate the business
Together with FanDuel, DraftKings is already the market leader. The two companies have emerged as the Coke and Pepsi of the sports betting industry.
Both companies let players place traditional bets, such as who will win the game and / or cover the distribution of points. (The Chiefs are preferred by 3.)
Players can also place so-called proposition or “prop” bets on results, e.g. B. Who will win the game’s MVP trophy – Robins said Patrick Mahomes of the Chiefs is the favorite with Tom Brady of the Buccaneers – or which player scores the first touchdown.
DraftKings also hopes to use the Super Bowl spotlight to bring in even more customers. Robins told CNN Business that the company will run two 15-second commercials on Sunday night: one just before halftime and another in the third quarter.
FanDuels King said he wasn’t concerned about the fact that DraftKings was promoting during the game – and potentially adding brand awareness to customers.
King said it didn’t make sense for FanDuel to buy ad time this year. CBS reportedly charges around $ 5.5 million for a 30-second commercial. But he didn’t rule out advertising in future Super Bowls, and noted that there are enough players to support several successful companies in business.
“We are still in the very early stages of this industry. If you compare it to any other digital and disruptive industry, it will be a cleanup,” said King. “But it won’t be a winner who takes the entire market. There will be some great players.”
Casino companies also want to benefit from sports betting
Barstool has the potential to be a third major player in the online gaming space as the company continues to expand into other states.
“We’re happy with the early returns, but we’re in a great place where we believe we can generate significant market share and profitability just by relying on (our) Barstool media partnership,” said Jay Snowden, CEO from Penn National Gaming, on the company’s earnings conference call Thursday morning.
Casino giant MGM (now supported by Barry Diller )IAC (, is also increasing its online sports betting presence. And Bally recently announced it would buy the leading fantasy sports company Monkey Knife Fight. )Caesars ( Business is also growing more aggressively thanks to the proposed acquisition of UK-based bookmaker William Hill and a partnership with fantasy sports company SuperDraft. )
“Nobody but FanDuel and DraftKings has a bigger market share right now,” said Eric Hession, Co-President, Sports and Online Games, Caesars. “The reason we’re making these investments is so that we can come up with a compelling offer over the long term.”
Hession added that gaming companies like Caesars can leverage their existing base of players in physical casinos and leverage their brand names and marketing skills. Caesars invites around 250 of its most loyal customers to watch the Super Bowl at a socially distant event at Allegiant Stadium, home of the NFL’s Las Vegas Raiders.
Several other companies in the fantasy sports and gambling world want to capitalize on the hype surrounding the Super Bowl as well as other live sports.
A company called PrizePicks even allows fans to make mixed sports predictions: a customer could make a combined prediction of how many Fantasy Points Mahomes will add and how many points Bradley Beal of the Washington Wizards will score against the Charlotte Hornets Sunday.
So there is a lot of gambling and competitive interest for the numerous sports betting and fantasy sports companies.
“The Super Bowl is a very busy time for us,” said Adam Wexler, PrizePicks CEO. “It’s an active week for all of the daily sports fantasy sites.”