DraftKings joins sports betting companies on the Super Bowl hype

Photo credit: https://depositphotos.com/vector/american-football-field-with-stadium-lights-75687125.html
Photo credit: https://depositphotos.com/vector/american-football-field-with-stadium-lights-75687125.html

DraftKings Several states have allowed gambling, particularly for sports.

Therefore, Super Bowl LVII is perhaps the biggest occasion for the gambling industry.

High stakes

The American Gaming Association anticipated before the game that more than 50 million people will wager over $16 billion on the NFL matchup between the Philadelphia Eagles and Kansas City Chiefs.

Due to the significance of the game, the following gambling industry titans had an opportunity to attract additional clients:

  • DraftKings
  • FanDuel owner Flutter Entertainment (PDYPF)
  • MGM
  • Caesars (CZR)
  • Wynn (WYNN)

The game also had an effect on the stocks of several sports betting organizations, with many of their shares rising in 2023 and the market as a whole rebounding.

Many of the stocks, however, are still making up for their severe losses.

Stock progress

DraftKings has had a 30% decline over the previous year and a 75% decline over the previous two years.

Both Caesars and Penn Entertainment (PENN) own shares of Barstool Sports, although they both saw a 40% decline in value in the prior year.

Rush Street Interactive, the parent firm of BetRivers, experienced a decline of over 65% during that time.

Each business invested a sizable sum on extravagant advertising initiatives.

Jamie Foxx has been in MGM advertisements, and Kevin Hart has been seen pitching DraftKings.

Caesars has received endorsements from JB Smoove and the Manning family in television ads.

Additionally, bookmakers for sports have started spending money on advertising campaigns like “free bets.”

Two birds and one stone

Companies that provide sports betting must now carry out strategies to hit two birds with one stone:

  • Gain new customers
  • Restore investors’ confidence

MGM, however, holds the advantage in the present rivalry.

Its BetMGM division operates the only physical sportsbook at the NFL game. BetMGM is a 50/50 joint venture between the massive Las Vegas casino and UK gambling business Entain.

Outside of State Farm Stadium, where the Chiefs and Eagles were playing, the stadium opened in Phoenix in 2022.

Without a doubt, gamblers have used their phones to place wagers.

The CEO of BetMGM, Adam Greenblatt, however, stated that transactions at the sportsbook before and during the game should go quickly.

“We have prepared for this Super Bowl like never before, said Greenblatt.

“We are staffing up for a lot of demand.”

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Marketing opportunity

Greenblatt claims that the 17,000 square foot sportsbook close to the stadium features 38 HD TVs and a huge display wall so that bettors can see the game.

To encourage fans to wager on the game, there are 25 betting incentives.

The physical position at the Super Bowl is a terrific marketing opportunity, according to Adam Greenblatt, with a competitive market versus DraftKings, FanDuel, and other casino businesses.

His objective for Sunday is to persuade customers to download the BetMGM app, create an account, and place wagers at the sportsbook.

Greenblatt emphasized the importance of marketing, saying MGM can remind players that it is a historical casino brand rather than an upstart like DraftKings, FanDuel, or Barsteel.

“We’re fun and sophisticated. Ocean’s Eleven. That was an MGM experience,” he said, reminding people it was the MGM Grand in the 2001 film.

“We want to be both aspirational but also accessible.”

Sports betting companies vs. casino companies

Industry newcomers aren’t very concerned about casino operators despite the rivalry.

Following the legalization of sports betting in Ohio, Maryland, and Kansas in 2022, according to FanDuel CEO Amy Howe, there is significant space for expansion.

“This should be the single biggest day in FanDuel’s history,” Howe said.

FanDuel anticipates 17 million wagers on Super Bowl LVI, which is more than double the number for the Super Bowl in 2022, she added.

Howe said that FanDuel expects the betting to attract over 500,000 new clients who will wager on the game, particularly as more women do so.

However, Jason Robins, the CEO of DraftKings, thinks that bookmakers have realized that they can’t keep spending money on pricey promos.

“If anything, the competition now is less intense than last year,” said Robins.

“Last year was the peak. It was somewhat irrational.”

In the past, Wall Street penalized businesses like DraftKings for pursuing market share at any costs.

“Investor tolerance for the types of undisciplined spending during the NFL season last year has waned,” said Robins. “Investors want to see a path to profitability.”

“That’s different from 2021 when customer growth was being rewarded.”

Both DraftKings and FanDuel still intended to run further Super Bowl LVII advertisements.

While FanDuel enlisted NFL star Rob Gronkowski to make a field goal “kick of destiny,” DraftKings has another commercial with Kevin Hart.