The relationship between DraftKings and NASCAR is staying in the fast lane.
After launching NASCAR daily fantasy contests earlier this year, DraftKings recently announced a partnership with the Race Team Alliance, a coalition representing nearly every team and top-level driver in the sport.
The deal is the continuation of an aggressive push by DraftKings to diversify its offerings and brand recognition across a wide array of sports.
DraftKings continues down path of diversification
In May, DraftKings signed a three-year partnership with NASCAR, granting the site exclusive rights to NASCAR’s sophisticated real-time data feed. The deal also provisioned for heavy cross-promotional efforts.
The partnership was initially seen as a bold move for DraftKings, seeking to set itself apart from other offerings in the DFS space, chiefly FanDuel. While FanDuel might hold an edge in fantasy’s most lucrative arena, the NFL, DraftKings has become increasingly aggressive in diversifying its own offerings and partnerships.
“We want to offer the most diverse lineup of different fantasy sports,” said DraftKings co-founder Matt Kalish. “If there’s a big fan following out there for something, we want to find a way to make that sport more interesting to fans, and bring them a little closer to the game.”
DraftKings also has an eye toward the entries of Yahoo and PokerStars parent Amaya into its marketplace. Yahoo launched its DFS product last week, while PokerStars’ product is expected later this year. Yahoo, so far appears to be staying out of NASCAR DFS.
Daily fantasy racing: The next golf?
Diversification has paid early dividends for DraftKings. The company launched a fantasy golf product earlier this year which outperformed expectations, drawing a sizable player base.
Few sites currently offer daily fantasy auto racing, with DraftKings occupying a far more prominent market position than competitors like Fantasy Feud and Sports Tradex.
Of course, NASCAR, like golf, brings with it questions of legality under the fantasy carveout in the Unlawful Internet Gambling Enforcement Act.
NASCAR deal was a long-term goal for DraftKings
DraftKings began offering NASCAR contests starting with the Coca-Cola 600 in May, but Kalish said the company had long been working toward an alliance with NASCAR, one of the most popular spectator sports in the United States.
“It would just be a huge miss not to hit that audience,” he said. “It’s something we really wanted to do from day one.”
With NASCAR, DraftKings hopes to build the same sense of ubiquity it has established in other sports, including a particularly close relationship with Major League Baseball and a vast majority of its franchises.
“We talked to NASCAR about our plans, and shared with them what we’ve been able to do with other professional leagues,” said Kalish, “We just tried to look for a way to do something together, and this is what we’ve come up with.”
Hopes of recreating MLB partnership success
The MLB partnership with DraftKings, which includes an equity stake in the DFS site for MLB, began in 2013. The deal was expanded to make DraftKings MLB’s official fantasy partner earlier this year.
“We’re integrated. It’s really part of the experience of watching baseball,” Kalish said.
While confident that such a close relationship would bloom with NASCAR, Kalish said the process would be a similarly gradual one.
“I think what typically happens is, you establish a partnership, and then over time it deepens,” he said.
The Race Team Alliance: A powerful ally
The Race Team Alliance, formed in 2014, has grown to consist of 18 teams and 37 drivers in professional stock car racing, representing every team fielding Sprint Cup competitors, with the exception of Furniture Row Racing, home of Martin Truex, Jr. The coalition is helmed by Rob Kauffman, a co-owner of Michael Waltrip Racing.
According to a press release, “the teams will support and promote the free NASCAR game on DraftKings.com with team marks, social and digital media initiatives, and other activation programs.”
It’s another signal that DraftKings is betting on NASCAR providing a big return down the road. Already, the site has started offering contests with six-figure prize pools, a trend likely to continue as more fans are introduced to daily fantasy racing.
Photo by soldiersmediacenter used under license CC BY 2.0.