It’s been almost a year since New York Attorney General Eric Schneiderman told FanDuel and DraftKings to cease and desist, claiming they were illegal gambling operations. After long legal battles, New York Gov. Andrew Cuomo signed a bill earlier this month to legalize and regulate the two companies as games of skill putting the nation’s largest daily fantasy sport leagues back in business.
Both companies (and their countless imitators) will offer the same basic product as before. In exchange for an entry fee, sports fans get the chance to win cash jackpots based on the statistical performance of players they select in real-life games. The distinction this time is that the organizations will be controlled with consumer protection rules and taxed at 15% of gross revenues in New York.
In at least one case, the brand is different too. One CEO told USA TODAY Sports earlier this month that his organization plans to change its advertising message as part of an overall rebranding.
Previous advertising messages were largely committed to emphasize the cash jackpot that ordinary sports fan could win. This led to a sea of sameness between the two companies, each trying to “out-jackpot” each other with extreme advertising frequency. The two private startups spent more than $200 million on TV ads last fall. One company even aired 25 different ads more than 46,000 times, according to the advertising tracker iSpot.tv.
The daily fantasy sport moguls certainly achieved consumer awareness, but not in the way their media professionals intended. Consumers became sick of the back-to-back ads from the rival companies. One CEO said, “There’s nothing more interesting in life than your fantasy football team, but there’s nothing less interesting in life than your buddy’s fantasy football team,” …“I think what we did was we reminded you about your buddy’s fantasy football team every fifteen seconds for several months,”.
These high frequency advertisers also put a damper on both social media and traditional advertising markets. On Facebook, where ad impressions are purchased with auction pricing, the big players effectively priced other advertisers out as they entered the auction with aggressive bids and huge budgets. For example, after careful examination of mobile-app advertising throughout the year, it was evident that when the two companies increased their Facebook marketplace spend last Fall, the cost of numerous apps inflated – this rise in cost coincided with the start of last year’s NFL season.
The duel came to a halt when this aggressive marketing assault on media platforms attracted the unwanted attention from state government officials, who noticed the companies were giving off a gambling “vibe” but were largely unregulated.
The upcoming NFL season brings new regulations on daily fantasy sport leagues, allowing an opportunity for these companies to rebrand themselves. One company’s new advertising message focuses on how its product enhances the sports fan experience in other ways. The CEO said, “We felt we really overly focused on one aspect of the product, which was around winning money,” “We know our players play our product for a whole bunch of reasons. They love the research. They love the competition with other players. … They love just how it enriches their sports experience, so we wanted to do a lot on enriching the sports experience”.
The company’s new marketing initiatives reflect the commitment to offering users the best experience and ensuring a level playing field for users of all levels.
The daily fantasy sports rebranding efforts includes a new way to play season-long fantasy, through their newest product feature, Friends Mode, which gives users the ability to play against their friends every week of the NFL season, similar to traditional fantasy sports leagues.
The redesign will cover all aspects of the advertising landscape. Gone are the direct response focused TV and radio ads screaming about winning a million dollars for a five-dollar entry fee. Website and mobile apps will now showcase a refreshed color scheme and more user-friendly layout, rather than the cluttered columns of contest entries, bids, and player stats. New websites also now include a user Bill of Rights and Governance page to keep players informed of the company’s commitments to them.
It was inevitable that government regulation would come to this gambling grey area, and a real test for the brands that originated the medium. The major players have not been shy about testing extensively, and backing up tests with major buys. How they sink or swim in the coming fantasy seasons will be worth watching. Who’s taking bets?