DraftKings has yet to decide whether it will scrap a promotion that has resulted in millions paid to National Football League bettors whose teams jumped out to a certain-sized lead.
A spokesperson for Boston-based DraftKings Inc. told Covers on Wednesday that the online sports betting company is weighing what to do with its early-win promotion for NFL games. The promo can pay out moneyline bettors if their squad goes up by seven or 10 points during a game, depending on the day.
For example, a bettor can use the promo to place a pre-game, moneyline wager of up to $250 (the limit) on the Pittsburgh Steelers in Thursday night's game against the Cleveland Browns. The player would then win if the Steelers score a touchdown on the opening drive and convert the extra point.
TNF, then TBD
“The promo is still live and will be up for [Thursday’s NFL] game,” DraftKings spokesperson Stephen Miraglia told Covers. “We’ll see what we do moving forward — not committing one way or the other.”
DraftKings has paid out more than $75 million on the early-win promo for the first two weeks of the NFL’s regular season, Miraglia said, which is what was reported first by the Action Network.
However, DraftKings is not sharing the overall handle, making it “impossible” for anyone to know if the bookmaker won or lost money on the promotion, he added.
Nothing lasts forever
All the $75-million figure suggests is strong engagement with the campaign, DraftKings says, and it would be “unfair” to say they are canceling the promotion.
“It would also be false to state that we are halting the promo after paying out $75 million, which some reports have indicated,” Miraglia said. “We develop these promos strategically and they typically don’t run forever.”
At the very least, the commotion around the DraftKings promotion is another sign of the sensitive situation facing online sportsbook operators.
The NFL season is a crucial time of year for acquiring new bettors and bookmakers have often used free bets and other promotions, such as early payouts, to win over customers. Yet companies are also facing pressure from shareholders to blaze a trail towards profitability, and costly promos and marketing efforts are becoming casualties of those efforts.
Therefore, the promos rolled out for this NFL season could just be a burst of generosity by operators still intent on proving to investors they can generate positive earnings and that plan to eventually stem their spending.
“Please remember what promos are intended for — to create engagement and excitement around key tentpole moments on the sports calendar,” Miraglia said.