BY JOE FAVORITO
NEWJERSEYNEWSROOM.COM
ON N.J. SPORTS MARKETING
There are wide-ranging numbers attributed to the number of dollars spent and people who play fantasy sports in the United States, but rest assured it is in the millions. Football is king, baseball second and then it goes down from there. The major media companies have found a jackpot in monetizing and aggregating fantasy play, and MLB.com has used the fantasy baseball business as one of the key engines in drawing sponsors, creating promotions and moving all sorts of ancillary services.
But when you leave the major media brands ? ESPN, Yahoo, CBS Sports ? the business falls off a cliff. There are scores of apps, services, books and seminars that are paid offerings at various dollars, and few do very well. Even more come and go quickly, no matter how innovative the technology.
The truth is that the amount of free material, ?websites, etc. along with the tribal nature of sports, and fantasy (you try a product and it takes a huge differentiator to get you to switch) makes the secondary fantasy information market very difficult to draw eyeballs and sponsor dollars, let alone consumer dollars that are substantial.
If you have a service tied to a media partner that gets you millions of views, you stand a chance even if your offering is mediocre. Without it, no matter how good the product, it?s tough to cut through both the clutter and the big name brands that offer services. After all, if you are a consumer and not playing in a large scale fantasy game with a big financial upside, what?s the need to go invest in better research that may only move the margin for you a point or two?
Well, because of the New Jersey casinos, that may all change. This week the state?s Division of Gaming Enforcement published regulations establishing standards for casinos to offer fantasy sports tournaments for money, starting April 22. While visitors to the casinos will be able to risk money on the games, New Jersey will not consider these games gambling, skirting federal law that distinguishes between fantasy sports and sports gambling. The regulations allow casinos to create their own games, or to partner with existing companies that are already providing real-money daily fantasy sports online.
So now if you are a fantasy player of any size, you now have the ability to have real dollars invested and a real upside into success, where the smallest margin good be a bigger payoff. Suddenly an investment in a dollar app or a nine dollar service that gives toy a three to five percent better margin of victory, or gets intangibles like weather or real time updates, becomes even more valuable.
This move to fantasy will be the next in an evolution that will see the US catch up to other parts of the world in regulated, legal online gambling. Services that offer small edges for mobile gambling on soccer in the UK for example, can sell micro payments for bettors to get updates during a game and increase both their wager and chances to win. In a heavy analytic game like baseball or even American football, the possibilities go up exponentially.
The move will also open up the opportunities for large scale analytics and gaming companies to enter the fantasy market as well, which will also raise the stakes for smaller analytic businesses to either grow or get bought out. There will be a gold rush of offerings, but like the gold rush, only the smart, the well-funded, the opportunistic and the ones with the wherewithal and the luck to stick it out will succeed.
It is going to make for interesting times in the sports world as 2013 moves along and States look for more revenue, and gambling sits there. Teams and leagues need more revenue streams, and gambling sits there. Media companies need other resources to tap into, and gambling sits there.
Yes it has to be regulated and it has to be controlled, as it is in many parts of the world.
However the first step is now making fantasy a reality business and the Garden State appears to be the first, but never the only one, to make the plunge as we hit spring. The size and value of fantasy sports right now is largely an ambitious estimate. However as the game now changes that estimate, like the dollars spent against fantasy, will become more real than ever before, and many of the biggest gaming players who may have shied away before, will suddenly be in the game. Millions is a term that will measure dollars more than participants as the game of fantasy rises, and the interest grows with the cash.
It will be a whole new ballgame.
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Joe Favorito has almost 30 years of strategic communications/marketing, business development and public relations expertise in sports, entertainment, brand building, media training, television, athletic administration and business. He has been head of communications for the New York Knicks, Philadelphia 76ers, the USTA and other entities and now runs a successful strategic communications and marketing consultancy based in New Jersey and Manhattan. He is also an author and instructor at Columbia University. You can find out more at joefavorito.com or follow him on Facebook and Twitter (@JoeFav).Source: http://www.newjerseynewsroom.com/state/thanks-to-new-jersey-fantasy-becomes-reality
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