DraftKings Daily Fantasy Sports Review
If you haven’t heard of DraftKings, then you must not watch much TV or spend much time in a gym. They advertise heavily on sports channels, so at any given moment in any given gym across the country, a DraftKings commercial is airing to an ever-growing audience that’s becoming fascinated with fantasy sports.
Fantasy sports is legal contests where players bet real money on real players. It’s a game of skill, not luck, and results are based on real games. The biggest company offering fantasy sports games is FanDuel but this is not about FanDuel. It’s about their biggest rival: DraftKings.
With the NFL season just starting to heat up for the Fall, this makes the perfect opportunity to investigate DraftKings and find out what all the buzz is about. And the amount of buzz is incredible, just from DraftKings itself: in the week ending September 11, 2015, they spent over $26 million on advertising…in just one week! That’s more than twice the amount spent by their rival, FanDuel. The stakes are high and the pot is huge, for whoever wins out in the end and becomes the preferred fantasy sports platform, stands to reap billions upon billions in profits.
While we are working on our daily fantasy sports guide about strategically winning and working within the system, let’s talk about the best DFS league to play and join in on at the end. For now, DraftKings deserves a review to better assists you on your winning ways.
Draftkings, the Company
DraftKings CEO Jason Robins is pretty busy these days searching out investors. He’s doing a great job: this summer he managed to net $300 million in investments, bringing total investment in the company to $426 million. Their investors include Fox Sports, the National Hockey League, Major League Soccer, Madison Square Garden, Major League Baseball, and Legends Hospitality (LH). LH is owned by the Yankees and the Dallas Cowboys.
They expect to spend around $250 million on advertising with Fox networks. This is push time for fantasy sports contenders so we’re going to be seeing lots of advertising from the big players. In fact, bold advertising is one of the reasons DraftKings has risen to the near top of the heap in the fantasy sports industry. In 2014 alone, they ran more than 1800 separate ads on television.
The DraftKings Experience
DraftKings offers free games and paid games, but there are a lot of coupon codes circulating for free entry into paid games. The industry is experiencing a rough battle for membership grabs, so at this point it’s anything goes as long as membership is snatched up during this crucial phase of fantasy sports development.
One of DraftKings’ enticements for new members is that they’ll double your cash when you make a deposit into your account, up to $600. So, deposit $200 and you get $400 to play around with.
In January of 2015 a class action lawsuit was brought against DraftKings over this deposit bonus. Plaintiffs claimed the TV ads were misleading, leading them to believe they’d get the $600 bonus immediately when in fact that was not the case. DraftKings requires members to sign a Terms of Use clause. That includes a statement containing a class action waver so we’ll see how far that suit actually makes it in the courts.
You may join for free but once you’re in chances are you’ll want to enter the paid games. This is similar to up and coming DrafTops daily fantasy league.
There is a nice variety of games on DraftKings, including things like “World Series of Poker”, PGA golf championships, Mixed Martial Arts, and soccer. For paid games, entry fees are as little as $.25, with a typical top prize of $1,000. Not bad for a quarter!
The game platform is both exciting and easy to use, which is not an easy state to achieve. In fact, consumer research tells DraftKings execs that their platform is very well received by their members.
Competition
With over 2 million registered users, DraftKings is a strong contender for the number two fantasy sports platform. While it’s true that anyone in the business will be trailing FanDuel for quite some time, DraftKings is the one to make it to the top, if anyone does. They’re the fastest-growing company in this industry, meaning they’ve already beat out any other platforms vying for market share.
Yahoo & ESPN
Who would those other competitors be? For one, Yahoo has just announced they’ll be starting a fantasy sports platform. ESPN, another expected big contender, already has ESPN Fantasy games for football, baseball, basketball and hockey. SportsLine is in there with their own version too.
Sportsline
Sportsline has NFL, CFB, MLB, NHL, NBA, and CBB games (CBB stands for “college basketball” and CFB stands for “college football”). Sportsline costs $10 per month or $100 per year for Pro Membership. It’s a division of CBS Interactive, which carries the CBS logo and is therefore presumably connected to CBS the TV channel.
The managers of this platform mainly seem to be pushing its analysis at the moment. They do offer the ability to play daily and weekly fantasy sports contests so we can look for this to grow in the near future. However, at the moment they are not considered a serious contender for #2 position in the fantasy sports industry.
CBS Sports
CBS Sports is all over the place with various fantasy sports platforms they offer. From the Fantasy area of the CBS Sports website, there are links to FanDuel and to CBS Sports’ own version of fantasy Football …but not Sportsline! The terms of agreement for CBSSports.com does mention CBS Interactive so somewhere behind the scenes maybe this is really Sportsline.
The real point here is: while FanDuel may be the distant front-runner in the fantasy sports industry, there are several big names shuffling the deck for the number two position. DraftKings may have come out of nowhere and they may be the fastest-growing fantasy sports company out there, but CBS, Yahoo, and ESPN were already big names to begin with. DraftKings can grow all they like and still be nowhere near the size and power of these big brands. We’ll have to wait it out and see how the dust settles before we know who eventually becomes a true rival for FanDuel.
Also out there scrambling for positions are:
- Fantasy Aces
- Fantasy Feud
- DraftDay
- Fantasy Hub
- StarsDraft
- PlayDraft
The Future of DraftKings
CEO Robins plans to merge the worlds of fantasy sports and live sports in order to prevail over his competitors. To do this, he’ll be relying a lot on social media.
DraftKings plans to differentiate itself from its competitors by more fully developing its social media platforms. This strategy is based on the fact that fantasy sports is highly interactive: the more people play fantasy sports, the more they tend to start watching sports on TV, interacting on social media, and following news stories and TV commentary as well.
They also plan on expanding into Europe and Asia. First stop: the UK.
The Opportunity
DraftKings has an opportunity, but it’s really more of an opportunity for them than for you. There is a “Refer-a-Friend” program but the money you make cannot be cashed out. It goes into your DraftKings account where you can use it to play games.
If players enter the DraftKings site from your link and sign up to play a deposit game, you get 35% on that referral. Your commission is based on whatever they pay to enter the game.
You must refer 2 people every 30 days in order to qualify for the 35% commission. Otherwise your commission drops down to 20%.
The Verdict
DraftKings offers an excellent gaming experience, they have serious sponsors with lots of cash, and they know how to spend that cash (heavily, on advertising!). If anyone can make a run at FanDuel’s top ranking it will be DraftKings.
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