DraftKings has welcomed the findings of a new study which has highlighted the ongoing evolution of the fantasy sports industry. The latest research suggests that it is ‘getting harder and harder’ for operators to grow their core user base, but shows that progress has still been made during a difficult year.
Eilers & Krejcik Gaming’s annual market study, released on Friday, showed that an estimated $3.26 billion was spent on daily fantasy sports in 2016. This increase of 4 percent was dramatically different to the previous year, when fantasy sports betting companies are thought to have grown 222 percent.
The report’s authors have admitted there are reasons for the drop-off in growth, after a year when DraftKings and FanDuel had to spend a lot of their time and money on legal battles. Adam Krejcik said in the Boston Globe: “It’s not bad, in light of the regulatory headwinds and the reduction in sales and marketing.”
Speculating on the future growth of the fantasy sports industry, the report suggested that it might range between 5 and 15 percent a year until 2020. Krejcik added: “There are so many variables that it’s tough to say. But basically, we’re saying that you’re not going to see 200 percent growth year over year.”
A separate report published late last year, by the UK’s Juniper Research, argued that the industry could be worth $5.3 billion by 2021 if there is an explosion of interest in Europe, and DraftKings is satisfied that business is going in the right direction. Responding to the latest study, a DraftKings statement said: “While still nascent, we are pleased to see additional affirmation that the fantasy sports industry continues to grow and evolve.”
A proposed merger between market leaders DraftKings and FanDuel would help the companies to cut costs and possibly lead to increased growth, while the expansion of daily fantasy sports into new countries beyond North America is already well underway, as the industry continues to go from strength to strength.