60 percent of NJ sports bettors and daily fantasy players admit they have no loyalty to one specific platform, according to a recent survey. Many of the over 600 participants also noted they have wagered less often, less frequently, or played less DFS contests during the coronavirus pandemic.
Hot Paper Lantern Digital Sport released their findings on September 23rd, during the height of a busy sports schedule influenced by months of dormant activity following the COVID-19 outbreak across North America and the world.
Building retention and loyalty
While 75 percent of respondents said they were as or more interested in sports betting during the pandemic, only 49 percent said seeing ads prompted wagers or fantasy activity.
This calls into question some of the major partnerships and promotional campaigns created by the major sportsbooks, who have spent hundreds of millions to grow across new markets as new states legalize regulated sports betting.
“This is an immature industry that is trying to grow quickly, trying to mature, and what you have is most of the companies out there are marketing and showcasing their experiences as immature companies would,” said HPLDS CEO Ed Moed about the findings.
“It’s not the way to really brand build, it’s not the way to build retention. Retention happens when there’s loyalty.”
Moed noted that the free bets and promotional offers only go so far. Respondents to the survey said they were more willing to be exclusive to one platform if:
- The content was more “personal, witty, or connected to me beyond promotional codes”: 36%
- Referred by family and/or friends: 29%
- There was content online that informed or entertained: 27%
- Companies highlighted community donations or partnerships: 24%
- “the company clearly looked and communicated how it is different from all the others”: 20%
- Endorsed by celebrities or sports experts: 14%
This survey comes as a cautionary counter to the continued growth of sports betting in handle across the nation.
New Jersey shattered previous monthly records with over $660 million in August and could eclipse a billion this month with the return of football and other sports playing as well.
Findings show how the industry shifted when DFS powers FanDuel and DraftKings took control of the sports betting market in the Garden State and have expanded effectively against longtime gaming titans like Caesars. Tech beat the conventional powers to the top of the ladder and now the start-ups have to adopt the industry practices of the established names.
What’s next for NJ Sportsbooks?
Moed said the next three to six months will be key to see companies gain maturity.
“There will be winners and losers, and some of that will be around retention,” he said, comparing the current situation to the rise of Google over Yahoo and other tech companies years ago.
“They’re looking at their brand as a critical part of their business and it’s not just about, ‘What’s our weekend take and how do we just keep building money?’” Moed said of FanDuel and DraftKings.
“For investors, it was about immediate growth and now it’s about sustainability.”
Moed pointed to the strong start of Barstool’s sportsbook app earlier this month in Pennsylvania as players showing affinity and loyalty to a known brand.