Interesting Article On DFS Games: Bloomberg
Posted: Thu Sep 17, 2015 3:41 pm
We are strong proponents of DFS and especially Fanduel and Draft Kings because they are raising the specter of fantasy sports. Anything that brings in more fantasy players is good for all of us, including season-long games.
That being said, there are concerns about DFS right now and they involve the sharks eating the guppies. It's no different than what we saw in online poker. But some of the facts in this Bloomberg article are pretty amazing. Here's the story:
http://www.bloomberg.com/news/articles/ ... y-football
Probably the most amazing statistic from this story was this:
"Analysis from Rotogrinders conducted for Bloomberg shows that the top 100 ranked players enter 330 winning lineups per day, and the top 10 players combine to win an average of 873 times daily. The remaining field of approximately 20,000 players tracked by Rotogrinders wins just 13 times per day, on average."
And these aren't good signs, either:
"And there's evidence that Sud’s victims aren’t all clueless rookies—many are free-spending whales who hope to evolve into sharks in their own right. (Marine metaphors are common when describing the industry but don't always track precisely to actual science.) According to data published in July in Sports Business Journal, 36 percent of lost entry fees on one daily site during the first half of the current baseball season came from just 5 percent of the players. “That 5 percent is a critical number,” says Daniel Singer, a senior adviser at McKinsey & Co.’s Global Sports & Gaming Practice and co-author of the study. These big spenders invested an average of $3,600 on entry fees and lost an average of $1,100, a negative 31 percent return.
"The money-losing players tend to get lucky, win a few times, reinvest the prize money, and eventually lose. The losses are split evenly between daily fantasy sports websites such as DraftKings and FanDuel and the sharks like Sud. Only the top 1.3 percent of players finished in the green during the three months measured by the Sport Business Journal. An unrelated survey of more than 1,400 fantasy sports players conducted by Krejcik of Eilers Research this summer found that 70 percent of participants have lost money."
I don't have any analysis on this, I just thought it was a great read. Check it out and provide your thoughts if you have any. It's definitely a growing area of the market, but with some hurdles ahead of it, don't you think?
That being said, there are concerns about DFS right now and they involve the sharks eating the guppies. It's no different than what we saw in online poker. But some of the facts in this Bloomberg article are pretty amazing. Here's the story:
http://www.bloomberg.com/news/articles/ ... y-football
Probably the most amazing statistic from this story was this:
"Analysis from Rotogrinders conducted for Bloomberg shows that the top 100 ranked players enter 330 winning lineups per day, and the top 10 players combine to win an average of 873 times daily. The remaining field of approximately 20,000 players tracked by Rotogrinders wins just 13 times per day, on average."
And these aren't good signs, either:
"And there's evidence that Sud’s victims aren’t all clueless rookies—many are free-spending whales who hope to evolve into sharks in their own right. (Marine metaphors are common when describing the industry but don't always track precisely to actual science.) According to data published in July in Sports Business Journal, 36 percent of lost entry fees on one daily site during the first half of the current baseball season came from just 5 percent of the players. “That 5 percent is a critical number,” says Daniel Singer, a senior adviser at McKinsey & Co.’s Global Sports & Gaming Practice and co-author of the study. These big spenders invested an average of $3,600 on entry fees and lost an average of $1,100, a negative 31 percent return.
"The money-losing players tend to get lucky, win a few times, reinvest the prize money, and eventually lose. The losses are split evenly between daily fantasy sports websites such as DraftKings and FanDuel and the sharks like Sud. Only the top 1.3 percent of players finished in the green during the three months measured by the Sport Business Journal. An unrelated survey of more than 1,400 fantasy sports players conducted by Krejcik of Eilers Research this summer found that 70 percent of participants have lost money."
I don't have any analysis on this, I just thought it was a great read. Check it out and provide your thoughts if you have any. It's definitely a growing area of the market, but with some hurdles ahead of it, don't you think?