FanDuel Forced To Pay Out More Overlay With Fewer Guarantees
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DraftKings Kicks Off NFL Week 1 As Daily Fantasy Sports Winner

NFL DraftKings
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After Week 1 of the NFL season, DraftKings truly staked its claim as the top daily fantasy sports site.

FanDuel paid out about $1.4 million in overlay, while DraftKings had about half a million, according to the website SuperLobby.com; that disparity came even though DraftKings guaranteed far more money than its main rival.

In addition to that data, DraftKings continues to hold down the top spot in Legal Sports Report’s Site Standings, a position it has held for many weeks leading up to the NFL season.

By the numbers: The overlay

When considered as a percentage of the total guarantees at each site, it becomes even clearer how well DraftKings did.

According to Super Lobby’s data, DraftKings guaranteed about $21.3 million, while FanDuel guaranteed about $13.7 million this weekend.

DraftKings had approximately $550,000 in overlay. FanDuel, meanwhile, had $1.4 million in overlay, according to Super Lobby, including nearly $800,000 for its $5 million contest.

Those figures do not include “cash games,” which do not feature guaranteed prize pools.

The caveat to the revenue generated

While DraftKings clearly generated more revenue in Week 1, and had to pay out far less money in overlay, its estimated ad spend far outpaced FanDuel. Even so, both sites’ commercials were nearly ubiquitous across NFL programming on Sunday.

The difference between the sites in TV commercial spending has regularly sat at about a two-to-margin, according to the tracking site iSpot.tv — an estimated $20 million last week by DraftKings, and $10 million by FanDuel. DraftKings’ ramped-up marketing spend has also been going on for a longer period than FanDuel, which really started making a big push on TV this past week.

So while DraftKings is winning in customer acquisition and gross revenue, FanDuel has been more conservative in marketing expenditures (at least on the television front, which is the most costly and publicly visible metric available). DraftKings has spent aggressively in the weeks leading up to the season, hoping to attract customers at a higher volume.

We also don’t know some of the periphery data to the entries and fees generated. For instance, DraftKings was giving out tickets to its Millionaire Maker for referrals, and $3 tickets for new signups. How many? Clearly it was a lot, but we aren’t going to know how many.

Those TV ads are working, so far

While some have complained via social media about how many ads there are for DraftKings and FanDuel, the ad blitz appears to be working. Internet search interest for both sites is up a lot. Here is the Google Trends chart for the U.S. over the past 30 days:

A look ahead at Week 2

Both sites are going with similar gameplans for Week 2, it appears. Both are running the same top-level contests — $10 million guaranteed at DraftKings, and $5 million at FanDuel.

This time around, however, there will not be a run up of weeks, like there was for Week 1; both sites launched their biggest contests in August. They have less than a week to try to fill their contests for this week.

Week 2 will likely be a better indicator of where the two sites sit relative to one another, as we get into the weekly pattern associated with football season. And a key variable will be the amount dedicated to TV spend of both sites, and how well it continues to drive customers to their platforms.

Photo by NFL News Desk Admin used under license CC BY-ND 2.0

Correction: An earlier version of this article originally said that DraftKings’ $10 million contest sold out. This was not the case.

Dustin Gouker
- Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner.
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