Eben Nobvy-Williams, Sportico
DraftKings will continue to scale back on its partnerships with sports teams and leagues, CEO Jason Robins said Friday, calling it an inefficient part of the company’s business.
The comment is particularly notable coming from Robins, whose company is taking a more aggressive approach to customer acquisition than many of its competitors. Sportsbooks including Caesars and BetMGM scaled back their marketing and promotion costs last year in reaction to investors expressing fears about heavy losses; Robins said DraftKings’ costs in that area this year will likely be similar to the $1.2 billion spent in 2022.
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That spending, however, will not continue at the same rate with leagues and teams, a shift that could have large financial ramifications across U.S. pro sports. Robins said during an analyst call that “a number of partners” had already agreed to reduce fees as part of their deals and that DraftKings had already ended its relationship with some others. He added that the company would likely not renew a handful of addition deals.
“It’s really part of an overall effort that we have to be more efficient as a company,” Robins said on the call. “And I think that there is an opportunity in this category to get even better.”
DraftKings is an official sports betting partner of the NFL, NHL, NBA, PGA Tour and UFC. Robins did not name any specific partners, and a company spokesman declined to say which had agreed to lower fees. The boilerplate in recent DraftKings press releases state that it is an “authorized gaming operator” of MLB, though earlier releases indicate it was once at the higher ‘official sports betting partner’ level. (An MLB representative didn’t immediately respond to a question about whether the relationship had changed.)
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