FanDuel’s Strategic Moves Allow It to Gain Advantage in Betting Race

In the growing sports betting landscape across the United States, two leading operators solidified their presence as leaders. With many analysts acknowledging that the market is in a “duopoly” form, DraftKings and Flutter Entertainment’s FanDuel continue to hold a significant share of the sector.

With percentages varying from one month to the other, generally speaking, FanDuel and DraftKings hold between 70% and 80% of the sports betting market share in the country. Still, the actions of each operator can have an impact on their market share and in some cases FanDuel gains an advantage, while in others, DraftKings does.

A new report by expert analysts highlights that while DraftKings was in the lead for the first quarter of the year, FanDuel was a step ahead for the quarter that ended in June. Eilers & Krejcik Gaming (EKG) confirmed that the average revenue per monthly active user (ARPMAU) reported by FanDuel for the first quarter was $134 when compared to DraftKings’ $137 result, a report by Casino.org reveals.

The shift in FanDuel’s favor was the result of improvements to the company’s Major League Baseball (MLB) parlay product, EKG suggests. Moreover, the analysts explained that there was a “relative shift of the player base from daily fantasy sports (where there was a ‘some cannibalization’ in terms of active users) to casino, where monthly unique players (MUPs) were up 30%.”

Explaining the impact for DraftKings, EKG said that the operator was likely affected because of the inclusion of Jackpocket’s customers into “its MUP number and thus the calculation.” Still, the experts predicted that FanDuel is likely going gain further advantage in the US, thanks to strategic decisions.

FanDuel, “Wise” Not to Back DraftKings’ Surcharge Idea

Earlier this month, DraftKings announced its plans for the implementation of a surcharge as a means of offsetting the impact of revenues in states with high taxes. While the surcharge applicable to player’s winnings would affect clients in several states, the company said that the impact isn’t going to be significant.

After the announcement and amid criticism from bettors and sports fans alike, FanDuel decided against DraftKings’ surcharge idea. In light of this decision, DraftKings reversed its position, explaining that it “listened to its customers,” and decided not to pursue the idea about the surcharge.

Focusing on the surcharge, EKG acknowledged that FanDuel’s actions marked a “wise move” as the operator protected itself from a “potential backlash from customers and, perhaps more importantly, policymakers, who we suspect would not have looked kindly on any attempts to skirt paying taxes.”

FanDuel’s move not only pushed DraftKings to scrape the proposal but impacted the market as a whole. This is because if the two leading sportsbooks had implemented the surcharge, others would have likely followed too. Still, this doesn’t mean that a potential surcharge wouldn’t be seen as controversial considering that the consumers would be compensating expenses incurred by the operators.