Digital Wager Wire highlights the most significant events affecting the domestic and international sports betting and gaming industries each week throughout the year.
Prediction Markets Storm the NFL Betting Ad Wars
Key Takeaways
- Prediction markets spent $200 million on advertising in the first seven months of the year, signaling an aggressive push for consumer awareness.
- High-profile names like LeBron James, Giannis Antetokounmpo, Lionel Messi, and others help prediction markets appear more mainstream and trustworthy to consumers.
- Prediction markets are in a race for brand recognition, which will entrench them as industry leaders much like FanDuel and DraftKings did in the digital sports betting realm.
Prediction Markets’ Commercial Blitz
The NFL has returned, and prediction markets are investing heavily in advertising as the season unfolds in much the same way online sportsbooks did at the inception of the regulated sports betting industry in the United States.
Normally, the most creative commercials are reserved for the Super Bowl, but this year prediction markets are pulling out all the stops to advertise their brands and get noticed as the season gets underway.
Perhaps the best illustration of these eye-catching ads is Novig’s Sydney Sweeney commercial, in which she appears in the buff with footballs, soccer balls, and basketballs strategically placed to cover just enough of her to make it to the airwaves.
The ad has garnered plenty of attention, but Novig is not the only prediction market spending big bucks and making waves now that football is back. Polymarket made a big splash of its own by partnering with NBA legend LeBron James, Eli Manning, and Derek Jeter, among many others, while Kalshi wooed Milwaukee Bucks superstar Giannis Antetokounmpo and soccer icon Lionel Messi to stump for it.
According to the American Gaming Association, prediction markets have spent $200 million on advertising over the first seven months of this year, and their insatiable quest for sports betting market share has prompted the two biggest sportsbooks, FanDuel and DraftKings, to launch their own prediction brands to operate in states where they don’t have a mobile sports betting presence.
Legitimizing the Brand
Theron Tingstad, CEO and cofounder of ad agency Arbor Growth, spoke about legitimizing the prediction markets through celebrity endorsers: “The real return is category creation: prediction markets are fighting a legitimacy and regulatory-perception battle, not just a customer-acquisition one. Star power buys social proof and cultural permission, essentially signaling ‘This is mainstream, not a gray-market betting product.’”
The key to legitimacy and public acceptance is becoming mainstream, which is why prediction markets are investing heavily in celebrity endorsements. Moreover, aligning with sports leagues also lends credibility.
“To have a league like the NHL embrace Kalshi is a testament to the integrity, safety, and trust with consumers that Kalshi has spent years building during our time pioneering this asset class,” Kalshi CEO Tarek Mansour said last year in announcing that partnership.
But as we saw at the onset of the mobile sports betting craze, having name recognition before others is an enormous competitive advantage. And it is for that reason that FanDuel and DraftKings control approximately 75% of the online sports betting market, as they were the major daily fantasy sports operators before the regulated sports industry in the US was born in 2018.
“If we’re in inning one, as we saw in sports betting, first-mover advantage is big, so these companies are going to move as quick as they can to go acquire and build out as fast as they can,” said Jordan Bender, an equity research analyst at Citizens.
