Araz Heydariyehzadeh, Chief Commercial Officer at Scout Gaming, says that high player demand for fantasy sports extends beyond the US and that European operators should embrace the vertical to drive acquisition and retention.
When you think of fantasy sports and daily fantasy sports, there is sometimes an assumption that these are products more suited to the US market than anywhere else.
The US sports betting giants of today – FanDuel and DraftKings – built their brands and their businesses in this arena and it’s often believed that players in other markets simply aren’t as attracted to playing fantasy because they can wager on traditional sportsbook products in their countries.
But this is not the case and fantasy sports can be incredibly powerful for both player acquisition and retention. Operators in regions such as Europe can gain measured and proven benefits by adding fantasy sports products in their line-ups.
What makes fantasy sports so good for acquisition? And how can operators unlock the tremendous retention opportunities it provides?
Fantasy sports for acquisition
Fantasy sports is an incredibly powerful acquisition tool and has been used to gain market share by operators in Europe in a couple of key ways. With sportsbook products being pretty mature and somewhat commoditized in some regions, a Fantasy product can offer differentiation by providing a new vertical that has strong appeal to existing sportsbook users as it deploys many mechanisms those users will be familiar with, so the concept is new but not totally alien. This means operators can get extra engagement from their existing user base but also have something that sets them aside from the competition. Added to this, the more casual format and the skill element mean that totally new players or those not interested in sportsbook are often more comfortable playing fantasy than straight-up sports betting. This gives the operator an extra chance to bring in new users that might not have previously been interested in Sportsbook. With the cross sell tools that can be baked in to Fantasy products, Fantasy then provides an opportunity to convert Fantasy-acquired users to sportsbook later on.
This is why sports media giants and betting brands often run fantasy sports contests, some of which are incredibly popular with tens of thousands – sometimes even hundreds of thousands – of players taking part throughout the season.
Some of these players will not have wagered on sports before, and nor would they have without first finding their feet with fantasy sports. Sportsbook operators can use this to acclimate players via their brand and then once ready, transition them to real-money sports bettors.
Fantasy sports also allows operators to run contests with life-changing prize pools which can be used to drive acquisition campaigns. Prize pools in excess of €1m generate the most interest, but even contests with smaller cash pots and in-demand merch, tech, etc can attract players at scale.
Acquisition teams can also use fantasy to offer players more valuable bonuses and to differentiate. For example, offering a free entry ticket into a contest with a big prize pot can drive new player sign-ups and offer something a little bit different to the standard “Bet this, get that in free bets” sign up offer, with the added bonus that offering a free entry ticket in to a fantasy contest can’t be abused or used in a matched betting strategy in the same way free bets on sportsbook can. It can also be used to reactivate lapsed sportsbook players.
For example, we have recorded cases where the addition of a targeted fantasy bonus such as a free entry ticket being added to a CRM email reactivation campaign has generated impressive returns.
In one instance, the click-through rate was 25x the average and in another case, 2,000 inactive customers were reactivated within 24 hours of the email campaign being sent out. The same strategy can also be applied to acquisition campaigns, with the same CTRs achievable.
Fantasy sports for retention
Operators now have access to a whole range of clever automated tools, CRM, and content which has increased in availability and sophistication in line with operator’s shift towards retention (particularly in mature sportsbook markets where users will typically have accounts with multiple operators and generally give their business to a personal favourite or, often, the one offering the best promos and incentives that week.
But using constant promos to drive retention can be expensive and sometimes unsustainable longer term. Fantasy sports offers a form of sustainable, proven retention tools to operators that not only gives the operator a new vertical but has an impact on that operator’s sportsbook performance as a result. The game’s very nature requires players to return to the sportsbook each match day for the full eight months of the regular season. In the case of DFS, players can and do return to the book on a daily basis and provides operators with a chance to engage those users with their content
Data from the Scout Gaming network shows that the average user logs in four times a week to make changes to their team, and this helps drive some incredible stats for our operator partners.
According to the indexed numbers of users in the Scout Network, there are clear indicators that fantasy sports (especially season games) have a significant benefit in both user acquisition and retention.
- Churn after 12 months = 30% still active
- Churn after 24 months = 20% still active
- Churn on season-long fantasy tournament players = 50% still active in month nine
- Acquisition = +15% more players on a yearly basis after launching fantasy sports
- Time spent on site = fantasy players spend 20%+ more time than regular sportsbook players
Fantasy sports really does appeal to sport bettors, including those in Europe. Books that roll-out fantasy sports products can expect between 10% and 30% of their player base to engage with these games and this, in turn, can significantly boost GGR.
And this without the need, expense and risk of having to acquire new players.
Of course, acquisition is important – and fantasy absolutely can support this as well – but it is just as effective at retaining players and helping operators drive even higher lifetime values from their customers.
We have measured 45% increases in turnover and 20%+ increases in GGR on our partner’s sportsbook users that engaged with our fantasy sports products compared to those that didn’t.
There is considerable overlap in the demographics of fantasy players and sports bettors which is why there is a strong argument for operators, and especially those looking to offer differentiated products for user acquisition and/or increase yield from existing players, to consider fantasy.
The benefits of offering fantasy are real, and European operators need to shift their mindset from thinking this is a product only for the US market. It’s not, and those brands on the Scout Gaming network are leveraging the huge popularity to go for goal and claim victory over their rivals.