Comparing DFS and Season-Long Fantasy Customers

Daily Fantasy Sports (DFS) is widely regarded as little more than a small segment of the larger Fantasy Sports market, and because of this one would expect that most DFS players either come from a background in Fantasy Sports or have an interest in participating in both DFS and season-long Fantasy Sports.

For the most part, this is true, but there is also a fairly significant percentage of DFS players that don’t fit into this category. Recent market research by DFS’s largest company, FanDuel, seems to clearly indicate DFS has the capability to appeal to players who are uninterested in traditional season-long Fantasy Sports.

During a discussion at the Fantasy Sports Trade Association (FSTA) Winter Conference, Nigel Eccles, the CEO of FanDuel, and Danielle MacLean, the director of fantasy sports for CBS Sports, offered a unique look at the demographics of fantasy sports participants, particularly the similarities and differences between DFS and traditional Fantasy Sports.

According to their research, a full 17% of the site’s DFS customers do not participate in season-long Fantasy leagues – these players are DFS exclusive.

This data should cause many people to question just how much the two activities have in common, and whether or not they will become divergent or synergistic industries.

Yes, there is a lot of crossover appeal (currently 83% according to FanDuel’s research) but the two activities seem to be drawing customers with highly divergent motivations.

Participation Drivers

The idea that DFS can appeal to people beyond traditional fantasy sports players can be seen in motivations.

According to Eccles and MacLean, both season-long and DFS participants find the activity exciting (69% for season-long and 68% for DFS) and a way to make sporting events more watchable (72% season-long and 63% for DFS), but that’s about where the similarities end when it comes to why people play.

FanDuel’s research shows DFS players are more motivated by making money than traditional Fantasy Sports participants. A full 66% of DFS participants cited “making money” as a motivation whereas just 43% of season-long players cited money as a driver.

Furthermore, a vast majority of traditional season-long players were driven to participate because of season-long’s social qualities (71%) and the rituals associated with group play (58%). Conversely, these were listed as driving forces by just 25% and 17% of DFS players respectively.

Bottom line: DFS players see the contests as a way to make money (and since 66% cite this as a factor, it’s safe to say a good deal are overestimating their skill), while season-long participants are more realistic about their chances to cash in, and therefore play more for the social aspects associated with season-long leagues.

Where is DFS headed?

Add everything together and you’ll find DFS players are already starting to look more “hardcore” than season-long players. Unfortunately, this is precisely the type of player DFS sites don’t want to see. They don’t want to be the FiveThirtyEight.com of Fantasy Sports, they want to be BuzzFeed – a site that appeals to everyone.

As Adam Krejcik of Eilers Research stated in his presentation at the FSTA Winter Conference, the “biggest risk for future growth is not regulation… but rather ability to penetrate casual player market and avoid becoming too hardcore.”

Krejcik added that the DFS industry would be wise to study the rise and fall of online poker in the U.S. to avoid the same fate. And in my opinion, online poker and DFS share a lot of similar traits, and the DFS industry should heed Krejcik’s warning.

When you compare the typical DFS player to a season-long Fantasy player it’s a lot like comparing a 2015 mass multi-tabler with a HUD and tracking software running, with someone who signed up at an online poker site in 2004 because they watched episodes of the 2003 WSOP on ESPN.

As FanDuel’s market research indicated, traditional Fantasy Sports is highly appealing to what I’ll call casual online gamblers. Basically, traditional Fantasy contests will appeal to both professional online poker players as well as Joe Schmoe who plays in a bar poker league a couple of times a year. Season-long fantasy doesn’t rely on people thinking they can make money, in fact, the leagues thrive because people don’t need to win to have fun.

Season-long Fantasy has managed to shed its “domain of nerds and stat geeks” origins and appeal to mainstream America, while poker went the opposite way. Somehow the game went from a social ritual with little talk of strategy to a game whose reputation is fast approaching that of chess, both in terms of skillfulness and as a social activity.

The question for DFS is, which path does it follow?