DraftKings is testing a subscription service aimed at giving paying customers improved odds.
The $20-per-month plan was rolled out quietly late last month for select customers in New York, giving players up to a 100% profit boost on winning parlays, CNBC reported Friday (Jan. 3).
CNBC argued that other industry players will be watching the service closely, as DraftKings seems to be the first U.S. betting service offering subscriptions. Parlays — in which players bet on more than one event at once — are an increasingly popular area for the industry.
The company said in a statement to CNBC that the service is aimed at offering customers a better experience by “creating more excitement and value to our extensive parlay offering.”
The report noted that New York presents a fertile test case for DraftKings, as one of the best-performing markets for online gambling. The company may also be hoping to offset the state’s tax on sports betting, tied with New Hampshire for the highest rate in the nation at 51%.
As PYMNTS reported in November when the company presented its latest quarterly earnings, DraftKings refined its promotional strategies in high-tax states to target lower-value customers more efficiently.
The company said at the time that it was optimistic regarding growth this year, it faces challenges in the form of increasing competition and the unpredictability of customer acquisition costs, CEO Jason Robins said. DraftKings’ ability to fuel its growth will come down to managing promotional spending efficiently while still attracting and retaining high-value customers.
“We always try and reactivate stagnant customers through always-on tactics,” Robins said.
“We can trigger different CRM and retargeting treatments, and the other vector is more seasonal around event-driven activation. How can you use those moments to get additional reactivation? We try and use those big moments to gain activations.”
This is all happening amid a boom in online gaming, driven by companies like DraftKings and the rise of digital poker and online casinos. As PYMNTS wrote recently, this has made it critical for operators to enhance the user experience to retain players.
“A key area for improvement is the payout process, as traditional withdrawal systems are often slow and frustrating, driving players to competitors,” that report said.
Research by PYMNTS Intelligence has found that 79% of gamblers prefer instant payouts and 76% of those without access to them would choose them, if available. The research further showed that a little less than half of players had access to instant disbursements, spotlighting a gap between expectations and reality compared to physical casinos.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More