Are DraftKings, FanDuel Commercials Following Online Poker’s Marketing?

John Mehaffey September 14, 2015 2102 Reads
FanDuel commercial

The two major daily fantasy sports companies are pushing the limits on marketing spend.

DraftKings spent $24 million alone in the first week of September. It was the biggest spender in terms of national marketing for the week.

And the commercials are aimed at more than sports programming. DraftKings branched out into mainstream television shows and into less traditional airwaves like Pandora.

The total number of airinsg of DraftKings commercials was more than 50 percent higher than AT&T, which came in second place in that metric, according to ispot.tv. It was more than double that of No. 3, Warner Brothers. This shows that DraftKings is spending in less valuable time slots than others competing for marketing space.

FanDuel spent $9.5 million in the past week. That put it in sixth place; here were 2,660 national airings in the previous week.

This marketing blitz dwarfs any previous spend by online gambling companies. This is not the only difference.

DFS, like the poker boom?

The approach taken by DraftKings and FanDuel has some similarities to the online poker boom. In 2003, the online poker industry discovered the effect television brand awareness can have on viewers.

An Ultimate Bet live event was featured by the WPT. The online poker site experienced an immediate traffic surge.

PartyPoker was first to spend cash on television marketing in these events. Its traffic surged quickly. At one point, it held 60 percent of the online poker cash game traffic in the world.

PokerStars and Paradise Poker quickly followed suit. Both experienced high returns on the marketing spend. PokerStars became the world leader in poker tournaments, a title it never lost.

Government interference with poker commercials

It was not long before the U.S. Department of Justice got involved. It notified the National Association of Broadcasters that “the entities and individuals placing these advertisements may be violating various state and federal laws and that entities and individuals that accept and run such advertisements may be aiding and abetting these illegal activities.”

The threat worked, and most outlets pulled the advertising. One such case involved Discovery Networks holding $3.25 million of prepaid advertising from Paradise Poker. The DOJ eventually seized this money after Discovery Network became the subject of a lawsuit from Paradise Poker.

Online poker sites found a way around this ban on advertising. The sites created play-money online poker rooms at the .net address corresponding with the known .com. The website was advertised as not being a “gambling site,” the same language fantasy sports sites use today. The big difference? Online poker sites actually were not technically marketing a gambling product, because the .net domains always featured only play money.

Players would often type in .com out of curiosity or habit and find the real money site. If the player created an account at the .net site, that information would be used to promote the real money .com site.

Fantasy sports sites do not have to go to the trouble of creating play money sites on a .net domain.  Real money fantasy sports do not have the same opposition online poker faced during its prime.

Fantasy sports target national advertising, and the average person

Another difference between fantasy sports and online poker is that fantasy sports target national audiences. These can be major sporting events — a forum in which online poker was not welcome — or mainstream programming.

Online poker sites typically stuck with poker-related programming. In local markets, it went sometimes went after syndicated shows on cheaper spends.

Fantasy sports sites generally do not use celebrities to endorse the products related to its latest marketing push. Past winning players and sports fans are the focus of these advertisements. Some tell a story of big winners, while others talk about enjoying the action and being “hooked.” Some of the latest ads discuss small winners.

Poker sites often used professional poker players. These were sometimes the same players featured in the actual programming airing alongside the commercial.

Two similarities between fantasy sports and online poker marketing

There are two similarities between daily fantasy sports and online poker marketing.

One is the getting their logos onto telecasts. DraftKings has fantasy sports lounges” in Dallas, New England or Kansas City. FanDuel has partnerships with 16 teams.

Online poker sites try to get their logos on tables involved in the action. This was common for PartyPoker last decade. These days, PokerStars and WSOP.com are the most common ones to see. Online poker sites also use patches on sponsored players to get the brand in front of viewers.

Also, affiliate programs are used by both industries. There is a DraftKings promo code or FanDuel bonus code that a players uses when signing up. The advertisements, whether given over TV or on a website, track the player to the source of the advertising. If the agreement is an affiliate one, the referring site will received money based on the referred players.

Online poker sites have been using this same trick for over ten years. Some poker sites pay a one-time fee called CPA, while others share revenue with the affiliate.

Whether or not the DFS industry uses the same track as online poker, it is clear that daily fantasy sports sites are booming. It is anyone’s guess whether the industry has peaked or is just getting started. One thing is certain. Daily fantasy sports sites will continue to spend millions to draw players into the action.

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