FanDuel Launch – the impact of ringfencing

What is FanDuel

The world’s biggest Daily Fantasy Sports site- Fan Duel, have now completed their FanDuel launch in the UK!

The new FanDuel site that has been built specifically for UK customers was launched the week before the start of the 2016/17 English Premier League season, ensuring Fan Duel met their launch FanDuel Launch Pitch Viewtarget date.  Make sure you check out our full FanDuel UK review and user guide here!

What to expect from the FanDuel launch?

FanDuel have taken the complete opposite approach to market rival DraftKings in the UK, by creating a new gaming interface and new football game just for UK customers.  Not allowing UK players to participate in the same contests as North American customers means FanDuel have effectively ‘ringfenced’ their UK pool of players ensuring they can only play against each other. There are many positives and negatives or this ‘ringfencing’ approach some of which are listed below.

Positives of FanDuel launch ‘ringfencing’ in the UK

  • FanDuel have been able to create a simpler, easier to navigate game site for UK customers by not simply replicating their more complex North American facing site.
  • The FanDuel UK Fantasy Football contests will have an ecology entirely made up of new Daily Fantasy Football players.  This prevents more experienced North American players who may be viewed as ‘sharks’ coming in with winning strategies developed over time and winning the biggest share of the prizepools on offer.
  • FanDuel are able to host all contests for UK players in £ which is important for gaining trust in a new market and ensures players feel like they are playing a local product.
  • FanDuel have created a new salary budget tier of £100 million which makes it easier for fans of the season long official ‘Fantasy Premier League’ game to transition to Daily Fantasy Football as they are familiar with working with this budget cap.

Negatives of FanDuel launch ‘ringfencing’ in the UK

  • UK customers of FanDuel are limited to only playing in Football contest as the UK site does not offer contests based on other sports such as American Football, Baseball, Basketball and Ice Hockey that FanDuel.com offer.
  • FanDuel are unable to offer the size of guaranteed contests that DraftKings are able to due to none of their existing North American player base being able to play in FanDuel UK contests.  This means the top prizes for UK players for winning a contest at FanDuel UK will be less than DraftKings although the competition entry numbers will be lower.
  • Although not a direct consequence of ‘ringfencing’ FanDuel do not currently permit UK users to create their own contest which is a great feature if players want to play against friends in private competitions and is offered by most of FanDuel’s competitors in the UK.

Fantasy Fives View

The decision of FanDuel to create a new gaming site and ringfence their UK players was not due to regulatory or licensing requirements, so has been taken as a purely commercial decision.  FanDuel have decided that tailoring their product for UK customers will give them the best chance of gaining traction in the market.

FanDuel would appear to view the benefits of UK players being able to deposit and enter contests in £s, and the advantage of making the game as familiar as possible to UK customers as more attractive from an acquisition and conversion of new signups than the ability to share contests with their North American database and create bigger prizepools initially.

FanDuel are also well aware that UK Daily Fantasy Sports players are extremely inexperienced at the game versus North American players (although hugely experienced at traditional season long Fantasy Football) and by ringfencing the UK players, they have a better chance of creating a healthy ecology at launch at least, and not have the deposits of UK players being swallowed up and won primarily by the more experienced Daily Fantasy Sports players.

Overall Fantasy Fives believe that UK players will be able to learn and develop their Daily Fantasy Football understanding and enjoyment better in this ringfenced environment, which in the long term should see players participating more and sticking around for longer.   As such, the decision to tailor their product and create a ringfenced ecology is definitely logical and should give FanDuel UK the best platform to grow from.

 

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