Key highlights:
- "You can't get sophisticated with your generosity. The pricing isn't as good as ours”
- "It's hard to compete with someone with our level of scale and expertise"
- “I think what investors are trying to figure out is how sustainable the moat around your business is, and I think we’ve demonstrated that ours is very extensive”
In May 2024, Flutter reported that its sportsbook operation, FanDuel, became the number one iGaming operator in the US – adding to its existing #1 spot in sports betting.
At G2E 2024, Flutter CEO Peter Jackson took the time to reflect on this, speaking with Gambling Insider and Gaming America about how FanDuel plans on maintaining its first-place standing, as well as what kind of impact recent acquisitions made by the company will have going into 2025.
“I think the most important thing we can do to maintain our leadership position in America is continue to have the best product in the market,” Jackson said.
“We have the best pricing in the market, so customers have the best value proposition from us and we're getting more sophisticated in things like our approach to generosity. Delivering on all of those things, the technology we’ve created and our global expertise is what will keep us in a leadership position.”
While Jackson is not intimidated by growing competition from the likes of DraftKings, BetMGM, Caesars, Fanatics and ESPN Bet for example, he did comment on how Flutter attempted to take the media-first approach with its product in the past. The product wasn’t what the Flutter team and its leader had imagined, mainly due to the “difficulties in making the economics work across (Flutter’s) marketing and generosity.”
As he spoke on how FanDuel views its competition, Jackson stated how the investments Flutter and FanDuel can both make far outweigh the initiatives other operators can put forward in the industry.
“If you don't have the same revenue base as us, you can't invest in the same product development capabilities. You can't get sophisticated with your generosity. The pricing isn't as good as ours. It's hard to compete with someone with our level of scale and expertise,” Jackson said.
The thing that’s worth remembering, of course, is that while everything's big in America, the opportunity outside of America is even bigger
Flutter also held an Investor’s Day recently to outline goals and company targets through 2027, which also served as a means to showcase Flutter Edge. The company describes Flutter Edge as the “ability of a global business to leverage its scale and power to form unique competitive advantages through talent, product, technology and capital.” Jackson stated that investors were eager to see how Flutter, and its iGaming offering, continue to support the brands operating worldwide under the Flutter umbrella.
“What investors are trying to figure out is how sustainable the moat around your business is and I think we’ve demonstrated that ours is very extensive. We also wanted to show the size of the opportunity ahead of us. And I think both here in America and globally, there's a very significant opportunity for us to keep growing,” Jackson said.
Just over 13 months from the time of writing, Flutter appointed John Bryant as the company’s new Chairman of the Board, after Gary McGann’s nine-year tenure as a non-Executive Director came to an end. Bryant brings years of experience in business through stops at companies such as Kellogg's, Compass Group and Coca-Cola’s European partners.
“He is a terrific Chair and we're very pleased with the impact he's had. John, himself, was involved in a decentralised global business, so he understands those important concepts for us. He didn't have a lot of prior gaming experience, but that's okay, because we can go to our management team who holds the expertise of this industry.”
In regards to acquisitions Flutter has made, such as its recent €2.3bn ($2.52bn) purchase of Playtech's Italian B2C arm, Snaitech, Jackson spoke on how Flutter isn’t in the business of coming second, whether that be in the US or around the world.
The company also acquired a majority stake in NSX Group in Brazil, furthering its portfolio and push for global success.
John Bryant was involved in a decentralised global business, so he understands those important concepts for us. He didn't have a lot of prior gaming experience, but that's okay, because we can go to our management team who holds the expertise of this industry
“When we look at our operations in any of the markets in which we're based, we'll find that if we're the number one player in the market, we'll also have a much higher EBITDA margin than the number two or number three player,” Jackson said.
“That's just the benefits of our operating leverage and scale for the business. In Italy, we were a very similar size to Lottomatica, but we wanted to move into the gold medal position as the number one player in the market. So we were able to acquire Snaitech which should close next year, subject to antitrust issues, and it will give us that leadership position.
"The team in Italy has done a brilliant job growing the business. They’re benefiting from a lot of the Flutter capabilities over the last couple of years and we're excited to see what they can do with this extra scale in the market.”
Having just completed Responsible Gambling Education Month, which saw FanDuel make a second $1m donation to Operation Hope, a non-profit dedicated to financial literacy, Jackson made sure to state that responsible gambling (RG) should be a constant initiative for operators. FanDuel provides a number of services for consumers to utilise that assist in developing RG habits and keeping spending to a healthy amount, although it is currently involved in a lawsuit about a gambler who claimed FanDuel's VIP Manager contacted him 100 times a day.
“I see this as a constant challenge and opportunity for us to learn more, to better understand what our customers are doing and what the drivers are for them. I think we're making a lot of good progress from a cultural perspective in the business, but there's always more to do there,” Jackson said.
On the initiatives FanDuel is currently working on, Jackson stated: “We've got some great tools in place for customers, and I think the team is shooting an ad this week for that actually. It will be released later this year, further supporting (consumers), encouraging customers to use the tools we have available for them. But more than that, we also want to make sure the whole industry raises its standards. RG is important and the drivers behind that are crucial.
“Customers in America have access to some fantastic tools that will show them all of the information about their play in the last 30 days. They can see what their deposits are and what they've won or lost. We are also looking at introducing a tool that we've developed in Australia called Real Time Intervention, where we can assess the deposits customers are making into their account and whether it's a sensible deposit for them to make, or if it's something which is out of kilter for their historical behaviour. At that point, we can intervene and even stop the deposit.”
It's hard to compete with someone with our level of scale and expertise
Jackson also commented on the future plans for Flutter, as well as FanDuel, heading into 2025 and where the company can continue to grow to maintain its current standing.
“We're delighted with the performance of the team, they are doing a really nice job with some exciting new product features coming on the horizon, which will keep us ahead of the competition. The thing that’s worth remembering, of course, is that while everything's big in America, the opportunity outside of America is even bigger.
“Now that they've grown that number one market share, their focus is on internationally building that base. We want to win in America and keep growing our business internationally, which we'll do by investing organically in the business and returning capital to shareholders.
"A couple of weeks ago, we announced that we intended to return $5bn to shareholders over the next three to four years, but that still leaves us with the capacity to take advantage of that big opportunity internationally.”
