How COVID-19 Reshaped the Future of Legal Sports Betting in America
A chat from Las Vegas with DraftKings Director of Race and Sportsbook Johnny Avello
Over the next two weeks, we’ll be publishing a series of interviews with thought leaders from a number of industries about the impact of COVID-19 and — more importantly — the improvements they expect to last well into the future. Get to know Post-Pandemic America.
As we are all keenly aware, businesses big and small across America have been crippled since the onset of the pandemic approximately a year ago. Sports gambling, which is now legal (if not up and running) in more than half of the states in the U.S., though, is not one of them.
For proof of that, look no further than Boston-based sports betting and daily fantasy company DraftKings, which reported fourth-quarter revenue of $322 million last month, up 146% from the same period last year.
Impressive as it is on its own, that revenue jump is even more notable when you factor in that all major American sports went on hiatus for months starting last March, when the NBA suspended its season following Rudy Gobert of the Utah Jazz testing positive for COVID-19. So, without NBA, NHL and MLB games for customers to bet on, how did DraftKings find a way to not just maintain, but grow its business?
“We did a quick pivot and added content,” DraftKings director of race and sportsbook Johnny Avello tells InsideHook from Las Vegas. “We added more soccer that lasted quite a while, but then that dried up. We added some things like Premier League Darts and simulated NASCAR. Table tennis did really well and that actually carried us for quite some time. The kind of money that was bet on table tennis was shocking. Nothing’s going to surpass table tennis as the newest sport with the most handle. We went and found content our bettors appreciated. They were playing.”
Even once the core sports returned over the summer, DraftKings continued to offer its expanded menu of betting options because gamblers kept placing wagers. The takeaway? If you offer it, they will come — and bet on it.
“We’ve kept all those different sports that people weren’t used to around. We want to make the menu as big as we can so that there are options,” Avello says. “We’re looking at more content. We did cornhole last weekend. We’ve done eating contests. We’re looking into pickleball. We’re looking at other things too. As an operator, we’re going to continue to look for more content. I think bettors appreciate what we have, what we did at that time and what we kept.”
According to Avello, customers are also going to appreciate what DraftKings, which offers digital betting where available as well as brick-and-mortar locations in some jurisdictions, has planned moving forward.
“Pregame wagering is still the most popular, but in-game betting is growing fast,” he says. “The reason it’s growing fast is there are some markets that have robust action, like tennis. A lot of people like to play tennis by the point. When we added table tennis, that had a very similar action with people playing by the point and it still does. Golf has really grown in-game wagering. Will he hit the fairway? Will he get a birdie? Will he get an eagle? Those types of bets are popular. In-game wagering has grown at a rapid pace and will continue to be an area of growth.”
Another wagering area DraftKings is expanding into has actually has nothing to do with sports.
“You can’t throw up The Bachelorette to bet on because that show was taped three months ago. You can’t do things of that nature,” Avello explains. “But some of these regulators are really getting more aggressive because I think they see the growth in the industry. New Jersey was first and actually allowed us to take bets on the Oscars. When we opened up the Oscars, we had a lot of women sign up to bet because they felt that was something they really knew about. We’ve taken bets on the Emmys. We’ve done different things to try to appeal to everyone.”
Another way DraftKings is attempting to broaden its appeal and draw in more sports bettors going forward is by offering pools that are free to enter, pay out real money and can be played anywhere, even in states that don’t have legalized sports betting. Like the pandemic, the free pools began in 2020.
“We have a weather pool almost every day where we put up $500. We’ve got a movie and TV awards pool for $1,000. We’ve had election pools where we’ve put up $100,000,” Avello says. “Even if you don’t have discretionary income, you can play our free pools. We realize not everybody has money to play right now. So this is a way for us to put up the prize and let people be able to play. It gets you skin in the game without going in your pocket.”
With free users increasing by the day and an average of 1.5 million unique paying users each month, DraftKings’ proverbial pockets are only going to get deeper as sports betting expands into more states.
“It’s going to get very big. We’re not even halfway there yet,” Avello says. “There’s room for growth in our country and Canada has said they are going to do single-game wagering now. That’s an area we want to be in. The demand is there. Sit tight and stay aware, because we’re constantly changing and trying to come up with new ideas. We’ve got a long way to go.”
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