Mar 21, 2024 - Business

I've won $3K on sports betting apps in one week, and frankly I'm insulted

DraftKings ad on a train

On top of inundating us with ads, sports betting platforms like DraftKings are giving out hundreds of dollars to customers who sign on. Photo: Alexandria Sands/Axios

Sunday night, I became $450 richer while sitting on my couch.

  • The Carolina Hurricanes were about to start the second period on a power play. My husband took my phone (I can't take credit for this) to bet on the next player to score.
  • Instead of betting on one player, we used $105 from my $250 sign-on bonus to bet on six. When Evgeny Kuznetsov slapped the puck into the net, we jumped up and cheered.
  • "Do it again." I nearly threw my phone at him.

Why it matters: It felt like we cheated the system. I put $5 into this app, got $250 in "free money" to play with, won almost double that, and still have "free money" left over.

  • Between my husband and me, with some strategy and luck, we racked up over $3,000 in a few days using promo offers and referral codes on various platforms.

Reality check: "The idea of cheating the system — (sports betting companies) will be cackling behind your back," David Bockino, director of Elon's media analytics program, tells me. "The smartest thing you could do right now is pull out all your money and never think about this again."

💭 My thought bubble: Ouch. Do these apps think I'm that big a sucker?

  • We may have won $3,000, but FanDuel, DraftKing and the other guys, too, are banking on us losing more than that in the long run. In business talk, this measurement is called "customer lifetime value."
  • You'd have to win about 54% of all your bets to profit, says UNC Charlotte economics professor Craig Depken.

Yes, but: It's hard to comprehend how profitable or how fat of a budget these operators must have if they're letting me easily cash out on "free bets."

  • The average person will use the winnings on more bets. "It's like giving you $100, but you're gonna bet the $100 and lose it anyway," Depken explains.
  • "That amount of money is a small pittance to pay if they can build that individual into a long-term consumer," he adds.

The big picture: These companies are operating at a loss.

  • DraftKings has spent millions over the years in its customer acquisition state, pouring money into marketing. Netflix, Spotify, Amazon and Twitter are all models of companies that also bled money early on to embed themselves in consumers' lives.
  • The playbook: Get people to sign up, raise prices, crack down on password sharing, cut content and eventually turn a profit.

Threat level: I'm a news reporter, so I live a life hyperaware of societal issues. I vote in elections. I carry Narcan in my purse. I'd never buy a Kia.

  • I'm well aware of gambling addiction.
  • And still, I woke up one day this week, and the first thought I had when I opened my eyes was to check the app and see what I'd won overnight.
  • Bockino compares the sign-on incentives to handing out free drugs: "Hey, try it. Just try it."
  • Online sports betting is convenient, easy and private. Like I said, I did it on my couch.

What's next: On DraftKings, I used my sign-on bonus to bet on five different NHL teams winning the Stanley Cup. I figure one will, and I'll make at least $150.

  • My fingers are crossed for the Hurricanes. That's my team. They're also the biggest payout.
  • Now that I think about it, I'll have to keep the app downloaded until then. What's a few more months?

If you're experiencing a sports gambling addiction, you can call the confidential North Carolina Problem Gambling Hotline at 877-718-5543, text morethanagamenc to 53342 or visit the morethanagame.nc.gov website.

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