It would be funny if FanDuel wins in Massachusetts sports betting
Can Boston-born DraftKings or Barstool make a dent in the US leader?
If you’re new to me, let’s start here: I’ll get things wrong. After all, I’m the guy who predicted it would be difficult for FanDuel and DraftKings to pivot from daily fantasy sports into sports betting.
All they did was take dominant US market positions that no one has been able to eat into meaningfully.
HOWEVER, I do get things right on occasion, or even often. And I’ve been saying in the years since the fall of the federal sports betting ban that it would be difficult to unseat either of them.
This leads us to Massachusetts, which will launch online sports betting this week. And, we expect FanDuel and DraftKings again to be Nos. 1 and 2 (in some order) in marketshare, once we have numbers later this spring. DraftKings, of course, was famously founded in Boston in the early teens, and we also have Barstool Sportsbook, another company with Boston roots.
So it would be funny, and realistic, if FanDuel were to notch another early victory in Massachusetts. We know that FanDuel has about half of the marketshare in the US, and took dominant early positions in the most recent launches, Ohio and Maryland.
DraftKings and Massachusetts
DraftKings, from a narrative standpoint, would very much like not to be second fiddle to FanDuel in its home state. But is the “home state advantage” even meaningful here?
It’s not clear that it is, other than perhaps DraftKings’ database of DFS users is slightly or materially better than FanDuel’s, although I would bet on the former. I don’t really think the average new sports bettor really cares that DraftKings is a Boston-based company and has probably been subjected to more advertising over the years.
Otherwise, DraftKings is faced with an environment where FanDuel is doing even better at acquiring the first wave of customers in any given state than it used to be. Numbers from Ohio here; numbers from Maryland here. Yes, FanDuel is promo’ing the crap out of these states, but it’s getting bettors in the door and retaining them, so miss me with the idea this is a bad strategy.
All of this is to say that DraftKings certainly might be pursuing a strategy that will lead to challenging FanDuel more meaningfully, or its Boston roots are more valuable than I think. But I’ll bet against it.
Barstool and Massachusetts
Fans (or haters) of mine also know I have been dumping on Barstool and its prospects in the US sports betting market for some time.
Barstool has carved out a decent spot in the second tier of operators, although it still sits under 5% marketshare for sports betting when aggregating all of the states in which it operates.
Whether that is exciting, I suppose, is in the eye of the beholder; when I think back to the idea that Penn National (now Penn Entertainment) said it would soon be No. 1 in US sports betting upon acquiring a minority state in Barstool, it’s clearly an underwhelming position. If you don't look at it through that lens, it’s clearly a better story.
But again, we come back to story time, and the story is that Barstool is very much a Boston brand that is now a national brand. The home-field advantage for Barstool is arguably much stronger. And Barstool, I would imagine is banking on that being a gamechanger:
But I am here to tell you there is no chance that Barstool is No. 1 (or No. 2) on Day 1 in Massachusetts or even long term. If I am wrong, I guess add it to the giant pile of stuff I have been wrong about, and I’ll do something embarrassing to myself on the Legal Sports Report podcast.
Barstool’s value proposition has been converting the “tens of millions of Barstool fans” into sports bettors, but that strategy has resulted in a distant third, fourth, fifth or worse in every state for sports betting.
A “Boston bump” is not enough to give it the juice to displace FanDuel or DraftKings. This may sound extremely obvious to the people reading this, but I assure you it’s not obvious to Barstool fans, casual industry observers and probably people in the building at Barstool. (I think Penn has figured this out, however.)
A final look at MA sports betting
And we haven’t even talked about Wynn and MGM, which also have casinos in Massachusetts (Penn operates one of the three MA casinos, Plainridge Park). MGM also just signed a deal to be an official partner of the Boston Red Sox this morning, and figures to be a player in the state like it is everywhere.
But I am here to tell you that FanDuel is probably going to win again. I’ll look forward to DraftKings employees telling me how wrong I was if they take No. 1 in the state!