DraftKings Takes Over Presenting Sponsorship of NFL’s RedZone Show
DraftKings will be the presenting sponsor of the NFL’s RedZone whip-around show this season, part of a multiyear partnership that deepens the sportsbook’s relationship with the world’s richest sports league.
Under the deal, which was signed this week, the DraftKings logo will appear on the screen during live action and under the RedZone logo in graphics packages. The company’s live odds and stats will occasionally be integrated into the ad-free broadcast, which is popular among many fans but particularly for those who gamble or play daily fantasy contests.
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Americans wager more on the NFL than any other league or sport, making the next five months the most critical for operators across the industry.
“For us, the NFL is the biggest sport, the biggest customer acquisition source and the biggest chance to reactivate customers who maybe haven’t been playing since last season,” DraftKings CEO Jason Robins said in an interview. “For all those reasons, being able to get more deeply integrated with the NFL is very important, and very helpful for the business.”
Not only is the NFL among the most premium of sports advertising partners, but it also has a more limited supply. There are significantly fewer games, and unlike the NBA, MLB or NHL, the NFL caps the number of sportsbook commercials to just six per game. That’s created market scarcity that has sportsbooks looking for other marketing avenues with the NFL. The DraftKings’ RedZone deal is a prime example.
This is the first year in more than a decade that there will be a single RedZone product. The live, multi-game broadcast was originally launched by DirecTV, the NFL’s prior Sunday Ticket partner, which built RedZone, hosted by Andrew Siciliano, for its own subscribers. As the DirecTV product grew in popularity, the NFL created a separate one, hosted by Scott Hanson, for other cable providers.
As part of the league’s new seven-year, $14 billion deal with YouTube, the DirecTV RedZone hosted by Siciliano is now gone. Fans can watch the whip-around broadcast via YouTubeTV, its Sunday Ticket package, NFL+ or the via their cable provider.
The RedZone deal is separate from DraftKings’ betting relationship with the NFL. The Boston-based operator is already one of the NFL’s three top-tier sports betting partners, alongside Caesars and FanDuel. Those partnerships, which are five-year deals signed in 2021, give the operators special rights to use league marks into their products and to integrate sports betting content into the league’s website and app. There is also a second tier of sports betting partners that have more limited rights.
While sportsbook executives have repeatedly preached a more conservative approach to runaway marketing costs, gambling operators still spend handsomely for premium ad spots. DraftKings, for example, spent $1.19 billion in 2022 on “sales and marketing,” and is on pace to top that number in 2023.
That said, the company has reported more efficient marketing in recent quarters. In the first half of this year, for example, the company’s customer acquisition costs (CAC) were down nearly 30%, Robins said. In that span, the user base expanded by nearly 50%, reflecting the increased spending.
“To us, that’s great,” Robins said. “If you can get more customers in the door more efficiently, do it. So it’s less about trying to cut spend and more about trying to make it more and more efficient and continue to see that CAC decline. But ideally to do it in a way where we can end up finding more things that work and even spend more.”
With assistance from Anthony Crupi and Jacob Feldman.
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