TV made a big contribution to the growth of daily fantasy sports over the past three years, the Video Advertising Bureau says.
The VAB says daily fantasy sports, led by DraftKings and FanDuel, spent $300 million on TV advertising over the last three years and have built themselves into households names and substantial business.
The fantasy sports business now is under pressure as state authorities question whether or not it is a form of illegal gambling. Some states have threatened to close the sites to their residents, and a leading payment handler plans to stop doing business with the industry at the end of the month.
But some in the business are predicting that while the legal challenges have people nervous, they might return to their free-spending ways.
Between August and November alone as the NFL football season started, DraftKings spent $123.4 million on national TV ads, according to iSpot.tv. FanDuel spent $136.5 million. Spending tailed off after that with DraftKings spending $3.1 million and FanDuel just $1.1 million.
All that spending led to monthly unique website visitors jumping to 32.1 million in September 2015 from 67,000 visitors in March 2013. Player engagement increased 38% year over year during the football season.
More importantly, revenue increased to an estimated $330 million in 2015 from $5 million in 2012 and user spending on daily fantasy sports is projected to increase over the next five years to $17.7 billion.
“It’s clear that the above results would not have happened without the category’s immense, deep push into TV to reach their primary target, Millennials,” the VAB said.