Prior to last year’s Supreme Court ruling on sports betting, the legal options were few for those in the United States who wanted to have a little skin in the game for sporting events. Daily fantasy sports was one niche that filled the void for many.
From its infancy to the present day, the industry has experienced meteoric growth. In the early days, users playing the biggest contests numbered in the hundreds. Fast forward a few years, and the number of entrants in big tournaments measured in the tens of thousands.
Back in 2015, the two largest players in the game had grown enough to saturate the airwaves with ads. It was pretty tough to watch a game without seeing an ad for DraftKings or FanDuel, or even both. The marketing strategies for both companies have evolved over time, but those two giants remain at the top of the pecking order in the world of DFS.
Both companies have even spread their wings into a new realm: sports betting. In fact, FanDuel is the largest operator in terms of revenue in New Jersey while DraftKings checks in at number two. Both companies have designs on doing the same in other markets.
Many observers have taken this development as a sign that the decline of DFS is inevitable. After all, sports betting has been legalized in numerous states, and many more will follow. Once sports betting is close to being a (legal) nationwide past time, that line of thinking suggests that DFS will become passé.
But is that really the case? Will DFS users flock to sports betting and leave the industry behind as an afterthought?
According to a new research survey released by the Fantasy Sports & Gaming Association and Ipsos, the answer is a resounding no.
A Whole Lot of Crossover
The study was conducted over a two-week period in May and sought responses from those who identified as either fantasy sports players or sports bettors. A shade under 2,000 people responded, and they shared a treasure trove of information.
At the top of the list, 61 percent of those polled noted that they participate in both activities. As for the concerns that fantasy players will play less once there’s a new game in town, the survey indicates that there may not be much to worry about on that front.
Of the fantasy sports players who also wager, 87 percent of them revealed that they find themselves playing even more than they previously did. While there may be some users who switch and never look back, the numbers indicate that fears of outright cannibalization may be slightly overblown.
Unsurprisingly, football is the biggest driver for players. On the fantasy sports side, 78 percent noted that they played fantasy football. For sports bettors, 63 percent reported placing a wager on an NFL game.
NJ Makes for an Interesting Test Case
Since NJ sports betting was up and running quickly after the Supreme Court decision, the state makes for an interesting case study in a number of different ways. For this survey, FSGA and Ipsos were able to obtain responses from 712 sports bettors or fantasy players located in the Garden State.
There’s actually a larger crossover between DFS and sports betting in NJ with 68 percent of respondents participating in both. That’s a sizable leap from the 61 percent of total survey participants who reported taking part in both activities.
Other points of interest from the NJ study include that 29 percent of those who have wagered online since sports betting received a green light in the state are female. As for reasons why users are wagering online, 82 percent cited the ease of cashing out as a top reason, while 82 percent also pointed to the ease and speed of being able to place a bet.
Here’s the Biggest Takeaway from the Survey
There’s no question that legalized sports betting is a game changer in numerous areas. That will become even more apparent as additional states go online and open up brick-and-mortar sportsbooks.
However, legalized sports betting will not necessarily portend the doom of other industries. Yes, that includes DFS. Here’s what FSGA President Paul Charchian had to say about the results of the survey.
“These numbers demonstrate that fantasy sports players and sports wagerers are an extraordinarily attractive audience,” Charchian said. “We’ve seen significant growth across our industries over the last year and expect continued explosive growth as states legalize sports betting.”
Here’s another thing to consider on the crossover appeal for DFS and sports betting: both endeavors require similar skill sets. While there are certainly casual players in both niches, those who are really enamored with either hobby devote a lot of time and effort into them.
That means research, digging into the stats, examining the matchups, and looking for edges and weaknesses. To construct a fantasy lineup which has a legitimate chance to compete versus others, players really need to be on top of their game.
The same holds true for sports betting. It’s not easy to consistently beat point spreads or money lines. A solid research routine is one of the biggest tenets for long-term sustained success in sports betting.
It’s not too hard to draw parallels between DFS and sports betting, both from an enjoyment aspect and for what it takes to succeed in either one. As a result, crossover between the two industries looks like it will remain strong.
While some observers have jumped the gun and written the obituary for DFS, that doesn’t mean they’re correct. Just like in the community surrounding both DFS and sports betting, the loudest voices and those who feel the need to make the most noise about their opinions aren’t always right.