Andrew Harrer | Bloomberg | Getty Images
It’s the term a sports manager uses when describing Thursday’s sports betting media deal with Turner Sports DraftKings and FanDuel. The executive said sports betting companies are still competing for brand awareness and market share to position their future avenues for revenue.
“It’s a good game for Turner and DraftKings,” said Chris Lencheski, chairman of private equity advisory firm Phenicia and CEO of Granite Bridge Partner‘Winning Streak Sports when I talk about partnering with CNBC.
Under The deal, Turner – that’s part of AT & T.WarnerMedia – integrates betting information from DraftKings and FanDuel with content from TNT, TBS and Bleacher Report and collects referral fees when bidders place bets on the websites.
For example, Turner’s TNT network could send a mobile push alert about an NBA game whose score is tied for the fourth quarter, along with FanDuel’s odds of winning the game based on that score. Recipients can click the link to place a bet through the FanDuel website. Turner will also license content to DraftKings and FanDuel to embed directly into their websites.
The US sports betting market is growing with 18 states and Washington D.C., already active. Betting revenue is also showing, as New Jersey reported that its sports betting “racked up bets of $ 3.3 billion in the first nine months of 2020,” with bets totaling approximately $ 750 million Dollars for september. according to PlayNJ.
According to Lencheski, sports betting companies want to secure potential sources of income with media agreements while betting themselves that more consumers will join the growth of the industry.
“This is one way to get a revenue business,” said Lencheski, also an associate professor at Columbia University. “They may be looking down the road where the path to revenue from this business begins and generating significant additional revenue because they built the path first.”
Each of the properties want something from the Thursday Pact.
Turner Sports is trying to increase the excitement to improve ratings as audience numbers for the National Basketball Association and Major League Baseball have dropped.
There are a number of reasons for the drop in sports ratings, including changing consumer habits, a presidential election year, and a pandemic.
The expectation is that audience numbers will pick up again next year, but after such a sharp drop, the sports leagues and networks that run them will have to make an equally sharp comeback to justify higher advertising costs.
Will Funk, executive vice president of sports partnerships and branded content at Turner Sports, said there was “a competitive battle for eyeballs that is busy these days” when he explained how this agreement could help TNT.
Funk identified sports betting as “a key role in driving audience numbers” for its NBA postseason games and Match 2 event in May with Tiger Woods and Phil Mickelson.
The excursion picked up 5.8 million viewers, the most watched golf event in cable history, with betting content from DraftKings.
On the NBA front although the league experienced a rating hitFunk said the “TNT Bets” of the network Simulcast for NBA games showed engagement growth. The separate broadcast provided “real-time data and analysis” during the NBA’s postseason for sports bettors.
Funk said consumers are “more inclined to watch for extended periods of time when they are either wagering, playing fantasy sports, or playing free games related to the game’s viewership.
“The time spent viewing is converted into higher ratings,” Funk added. “And higher ratings for us, that’s how we run our business and then we can monetize the advertising in that property.”
Turner Sports will also generate income from the partnerships through fees associated with helping the betting companies land customers.
When asked about the revenue from the fees, Funk declined to provide specific financial data for the agreements, but added: “There is certainly a partnership aspect to this where we are incentivized to help them grow their business and we will to do.”
The company will use its Bleacher Report app to track metrics associated with new betting consumers. It provides a more detailed app and aims to address the approximately 9 million users of Bleacher via their mobile devices.
Under the agreement, FanDuel will become the exclusive betting partner for Turner Sports’ NBA content. The company provided data and analysis on TNT’s simulcast games and gained brand awareness on the network’s popular “Inside the NBA” show.
FanDuel would like to continue using the show to entice fans to bet on games, with support from former NBA superstars Charles Barkley and Shaquille O’Neal.
“It’s such iconic programming,” said Mike Raffensperger, FanDuel’s chief marketing officer, in an interview with CNBC on Thursday. “They’re great and fun to see.”
FanDuel will also build on its partnership with Technology company Simplebet. The company is developing its micro-betting platform and is currently using a free soccer game on FanDuel for potential players to learn micro-betting. With Simplebet, users can bet on quick odds, e.g. B. which player makes the next catch or whether the next call is a temporary or ongoing game.
Raffensperger said the company will develop a basketball version of the free game in time for the next NBA season as it will continue to collect fan engagement data before converting the technology to real money betting.
“Real-time betting and micro-betting are likely the future of sports betting,” said Funk.
Expect FanDuel to build more media partnerships and join forces with influencers to further build brand awareness and attract consumers.
Raffensperger also said the company is “excited about the dynamism” of other states allowing sports betting, particularly because they are charging additional taxpayers’ money to compensate Covid-19 Losses.
FanDuel oversees Tennessee and Michigan as the next markets too Open mobile betting as the company expands. According to Raffensperger, Ohio and Massachusetts are also on the radar.
A general view of a “March Madness” logo is seen during practice prior to the first round of the NCAA basketball tournament at the Vivint Smart Home Arena on March 20, 2019 in Salt Lake City, Utah.
Patrick Smith | Getty Images
DraftKings owns the rights to Turner’s Major League Baseball games. In addition, rumors are circulating about another major golf competition – The match 3.
Funk declined to comment when asked about a third golf event, but confirmed that DraftKings would be the “partner” should the game take place.
Voting with Turner Sports will help grow its brand, but DraftKings has used other deals like an equity partnership with Michael Jordan and agreements with the New York Giants and Chicago Cubs to bolster its name.
This deal gives DraftKings access to the Turner Sports ecosystem, and the NCAA could be key.
Turner has banned the March Madness event of NCAA college basketball until 2032. This is more than enough time for the NCAA to shift their minds about betting to create their new revenue stream, especially when name, image and likeness guidelines take effect.
Funk said the network is not currently “active on our college sports platforms” but has not ruled out DraftKings as a partner should college property open itself up in a branding / sponsorship deal.
“When it becomes available, we’ll talk about it,” said Funk. “It’s not on the table at this point.”
With DraftKings aligning now, it could qualify for some of the cases predicts $ 8.5 billion when betting on NCAA basketball games.
That would give him another source of income to sustain his future.
Disclosure: CNBC’s parent company Comcast and NBC Sports are investors in FanDuel.