Why DraftKings CEO Jason Robins Said “People who are doing this for profit are not the players we Want”

A comment by DraftKings CEO Jason Robins has the gambling sphere in a tizzy. “This is an entertainment activity,” Robins said during the investor-focused Canaccord Genuity digital conference. “People who are doing this for profit are not the players we want.” And with that, cue the torches and pitchforks.

On Twitter, Robins was accused of saying the quiet part out loud and reinforcing gambling Twitter’s priors that the company (and industry) is hellbent on limiting professional sports bettors and banning recreational customers who win.

But Robins’ comments (in context) are quite milquetoast, and as Alun Bowden put it on Twitter:

“Because until everyone starts to understand how the economics of sports betting works we just end up repeating the same problems over and over again. Everyone is fighting for losing players money. That’s it. That is the customer everyone, even your sharp books and exchanges want…

“I’ve said it many times before that with gambling you sort of have to choose between being in the entertainment or the addiction business.”

Put more plainly, Robins is merely saying what everyone already knows, even if they don’t want to accept it. Sportsbooks want customers who deposit money into the ecosystem, not players who frequently withdraw funds from the ecosystem.

You can argue these customers are needed (and they do have value) until you are blue in the face, but the fact is, no sportsbook wants them. They want them at their competitors’ books since any value they add is seen industry-wide and isn’t sportsbook-specific.

If I ran an all-you-can-eat buffet, I would want to attract regular eaters—the type of customer that allows my business to turn a profit. I wouldn’t target professional eaters or people who see the buffet as a huge value and skip the bread, rice, potatoes, and pasta and go straight to the crab legs and prime rib.

That doesn’t mean I would lock the door if they showed up, but I might have specific rules in place, from a time limit to portioning higher food cost items) that would make my establishment more inhospitable.

Full Context and Parsing of DraftKings CEO Jason Robins Words

As someone who has spent the last decade parsing comments from lawmakers and executives, I understand that, unlike an article title, it’s the uncapitalized words that are often the most important. Every word is chosen with practiced precision.

Jason Robins didn’t say DraftKings prohibits or excludes ‘people betting for profit.’ What he said as the CEO of DraftKings is much simpler: they don’t want these customers. Some will come in through the doors, but that doesn’t mean DraftKings needs to appeal to, placate, or treat them with the same level of customer service or targeted marketing as a recreational player.

Robins also added additional context, identifying a specific type of player they are happy never to see, “The ones that don’t [select one app] are the ones you don’t want anyway. They are the bonus shoppers and bonus hunters. That’s less than 10% of the audience. They are not the most profitable customers.”

It’s easy to paraphrase, “People who are doing this for profit are not the players we want,” as winning players are not welcome. But a more careful reading would be, ‘our focus is on recreational bettors. We aren’t disappointed if winning players and bonus hunters find the climate unappealing and perhaps something close to hostile and go elsewhere.’

Is this any different than how the industry treats different cohorts of bettors? Or, any different than how a bartender treats a known tipper vs. a non-tipper?

Of course, with sports betting, there’s a second layer to this, as sportsbooks do limit and ban customers, but how widespread and arbitrary these limits and bans are is a topic that deserves its own column.

What Does This All Mean?

Circling back to Alun Bowden’s binary choice between entertainment or addiction, I think the point is, you can’t market your product as something the product isn’t – at least not to the overwhelming majority of customers.

Poker sites tried this during the poker boom when the game was marketed as a skillful enterprise. That brought in a vast swathe of people who didn’t have the dedication and work ethic to become experts at the game. These players quickly disappeared from the ecosystem. Left behind were plenty of players who were good enough to beat those players (if they received great bonuses and rewards), but not each other, and this player was the most problematic. And always lurking were the outliers, the true professionals who treated the wannabes in the same way the wannabes treated the true recreational players.

All the while, this model was propped up by the poker sites through rewards and other bonuses that pulled people towards that breakeven line.

This scenario led to a slew of players who believed poker was a game of skill, so the problem must be that they needed to study more, try harder, and just keep playing a bit longer. And that just created a segment of disillusioned and cynical customers who often displayed problem gambling behaviors.

It seems the professional class of bettors wants to recreate that environment, and Robins is saying, ‘that isn’t going to happen.’ We are selling sports betting as entertainment, and if you want to try to make a living from it, go right ahead, but we aren’t going to make it easier for you or market it as a viable approach.