DFS sites to cut back on advertising
DraftKings and FanDuel will cut back on their advertising to limit mass exposure and to avoid regulatory and legal hurdles.
US.- Daily Fantasy Sports (DFS) sites FanDuel Inc. and DraftKings Inc. are cutting back sharply on their advertising, after the overexposure they incurred into during last year’s football season. They aim to limit both their spending and the mass exposure that can lead to potential regulatory and legal hurdles.
Last year, the ads saturated sports television, capturing the attention not only of new users, but also regulators’. The advertising boom increased brand recognition and the number of users increased enormously; however, it also created a backlash as several state attorneys general who investigated the sites and said they violated state gambling laws, which resulted in the sites ceasing operations in some important states. The companies based their defense on the statement that their products don’t violate gambling laws, because the games involve skill.
This year, as the football season approaches, Nigel Eccles, FanDuel Chief Executive, says the company is cutting way back on commercials as well as rebranding both its website and its commercials, in part to de-emphasise big jackpots and other aspects of playing daily fantasy sports that resemble gambling. Fanduel will be spending less than half of what it spent last year.
On its part, DraftKings also intends to spend less than one-quarter of its previous advertising budget this year, according to Jason Robins, DraftKings CEO.