DraftKings CEO: We don't want "profitable" players
In case you missed it last week, DraftKings CEO Jason Robbins caused quite a stir in U.S. sports betting circles when he said the following at Canaccord Genuity Digital Gaming Summit in Toronto:
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“Usually, what we see in research is that most players favor one app and direct the vast majority of their game play there. And the ones that don’t are more the ones that you really don’t want, they’re bonus hunters and odds shoppers, and it’s a very small fraction of the audience. It’s less than 10% of the audience. But those are not the most profitable customers for obvious reasons.”
“This is an entertainment activity,” Robins said. “People who are doing this for profit are not the players we want.”
The comment immediately drew fire from sports bettors (mostly on Twitter) insulted at the idea that a sportsbook wouldn't want to take action from a "profitable" player. But there were some who defended Robbins, including Darren Rovell from the Action Network, who wrote:
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He said it because he’s at a summit with an audience made up of analysts and investors, and the biggest threat to his public company is the lack of belief that the promotional money being spent is going to yield profitability.
The market is down on that idea. Even with $2 billion in cash, investors are worried about bleeding money and whether DraftKings can get to profitability three years into entering a state. DraftKings stock has slumped 34% in the last month alone.
Being frank about what their research has borne out and how the company achieves profitability is more important to voice transparently here than it is to worry about the perception from a vocal few who criticize the company for not being a true book and for cherry picking customers.
Elsewhere, Jeff Edelstein from the Sports Handle wrote that he wished all sportsbook operators would "come clean" like Robbins:
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But you know what? I’m glad Robins said these things, and I wish all the other sportsbooks would show their cards and stop pretending they are a capital-S sportsbook when, in fact, they are … well, something a little bit different.
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There is a pretty big difference between books that take all action and let everyone bet up to the same limits, and books that actively seek to cut out the winning players and the sharp bettors.
One is a traditional sportsbook, the other is … something close, but not quite.
And while we’d all like all sportsbooks to be like Circa, a few facts get in the way of this. One is obviously the fact DraftKings — and virtually all the other new-fangled books — are publicly traded companies answering to shareholders. The entire goal here is — you know — making money.
Read more opinion and backlash about the comments here: https://www.legalsportsreport.com/60...ng-for-profit/
