How hard can it be to pick the winners of 13 NFL games?
For 5,207 DraftKings Sportsbook users this week, impossibly hard.
That how many bettors entered the inaugural $20 DraftKings Sportsbook Pools contest — quite a bit shy of the 10,000 entries needed to avoid overlay; more on that in a bit — and not a single one of them picked all 13 winners of the Sunday/Monday games. In fact, just one entrant out of 5,207 got 12 games right.
These were straight-up picks, no spreads, which in theory makes running the table do-able in this sports betting competition. But not on a week like this.
The Titans walloped the near-touchdown-favorite Patriots. The lowly Browns turned back the desperate Falcons. The Bills won by 31 points on the road. (You don’t even need to know who the opponent was to appreciate the absurdity of that result.) The injury-depleted Redskins won on the road despite getting out-gained by 215 yards. And the defending champ Eagles lost a must-win game at home to a Cowboys team that was 0-4 on the road coming in. It was a truly topsy-turvy week.
The favorites went 7-6. Getting all 13 games right on a week like this is like getting the whole first round of March Madness right; everyone assumes by the law of averages someone would do it, but then millions of people enter the ESPN Bracket Challenge and not a single one goes 32 for 32.
So in the first week of DK’s Pools experiment, the $100,000 guaranteed jackpot at the top went to nobody … yet. It was a weird, confusing, anticlimactic way to kick off the contest, and it was simultaneously a loss for DraftKings and for 99.5% of the entrants.
With a $20 buy-in and a $200,000 guarantee, DK needed 10,000 entrants to avoid overlay. You could tell it wasn’t going well when, at 7:39 a.m. ET on Sunday, they sent out an email with a special offer encouraging entries.
“For every 2 entries into the very first Sportsbook Pool ($20 entry),” the email read, “get a $10 FREE BET — up to 5 $10 Free Bets.”
As you can see, multi-entries are allowed in DK Pools, up to 32 per person. Unlike one of DraftKings’ daily fantasy sports “Millionaire Maker” tournaments, though, they’re a bit capped by the fact that nobody can build 150 lineups and truly mass entry.
The more significant limiting factor, however, it would seem, is the available bettor pool. DK Sportsbook is only available in New Jersey. Even though DraftKings was the leading NJ online sportsbook in the September revenue report, 10,000 entries was apparently just too ambitious for one state. Had it been a nation-wide contest, a million-dollar guarantee might have been within reach. But in the Garden State alone, 10,000 entries, especially in the first week without any established public awareness, proved far out of reach.
An exclusive winners’ club
DraftKings’ apparent loss — $95,860 in overlay to meet the guarantee — was the competitors’ apparent gain. If you could get into the money with at least 11 of 13 games right, you figured to earn a healthy return on your dollar.
But whereas DFS tournaments usually pay 10-20% of entrants, thanks to the unpredictable week of games this contest paid 0.5% of entrants. That’s right, only 26 out of 5,207 cashed. Here are the results:
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The payouts were announced in advance and would go as follows: All players with 13 correct split $100,000 evenly; all players with 12 split $60,000; and all players with 11 split $40,000.
(The fine print revealed that the prize pool would grow at the 11,765th entry, meaning if there were 11,764 entries, DK would be raking 15%, a staggeringly high number. Of course, it became irrelevant because of the low entry totals.)
The lone 12-point scorer, “mzigarelli,” only got the Washington-Tampa Bay result wrong. Mzigarelli impressively foresaw wins for Buffalo, Tennessee, and Cleveland, then needed the Giants to win on the road Monday night to stay separated from the pack. The Giants prevailed, earning mzigarelli a $60,000 payout all to him/herself.
The Giants victory left 25 entrants sharing $40,000 (14 entrants had the same score heading into Monday night but needed the 49ers to win), taking home $1,600 apiece. That’s a spectacular return on a $20 investment, better than all but the top 30 or so places in a typical Millionaire Maker tournament.
The DK Pools rules state that any unclaimed prize will roll over to the following week. So in this case, the $100,000 jackpot that nobody won becomes part of the NFL Week 11 DK Sportsbook Pools payout.
There’s a catch, though: DraftKings figured out that 10,000 entries was unrealistic and targeted 5,000 for this coming week instead. The contest details for this week read that there’s again a “minimum $200K prize pool,” and the prize pool “begins to grow after the 5,882nd entry.” The description notes that, “This pool includes $100K of prizes that were not won in Week 10.”
Understandably, the DraftKings brass adjusted their expectations due to the modest turnout in the first week of the contest. But last week’s overlay didn’t get paid out to last week’s entrants, and next week’s contest doesn’t become any more juicy, really, than last week’s was.
Had DK set another $200K guarantee, with the $100K from Week 10 on top, it would have started building this massive attention-getting jackpot that, like the Powerball, might keep growing week after week if the slates remain full of upsets. Instead, the jackpot remains the same (barring substantial growth in entry numbers this week) and, once it’s claimed, the jackpot will get smaller the following week.
The approach is sensible. DraftKings is not in the business of losing money. It likes a little overlay, on occasion, to get attention, but DK has no intention of turning a loss on this contest every week.
DraftKings is in a tricky spot here. It over-projected entrants for its inaugural contest and can’t maintain the same projection going forward. But the players who entered the first time around get screwed; they have to enter again the next week to try to claim that money that has, for the moment, effectively turned into rake.
And how eager are they going to be to enter after seeing how hard it was to cash last week? Not all NFL weeks will be like that, but still, 99.5% of entrants came away poorer. That’s a problem.
What should DK have done?
To our eyes, the notion of rolling over the jackpot was ill-advised. The rules should have stated that the top score gets the jackpot, the next highest score splits 60%, and the next scores after that split 40%.
In DFS, the cash line isn’t predetermined — that you need, say, 175 fantasy points to cash. It should have been the same here. If nobody goes 13 for 13, then 10 for 13 is good enough to cash.
Wouldn’t it have been a great story and outcome if mzigarelli had turned $20 into $100,000, 25 players had split $60,000 ($2,400 each), and another 145 players had split $40K ($275.86 each)?
Under that scenario, DK eats that $95,860 in overlay once, adjusts its guaranteed prize pool going forward, and the players all feel better about where their money went.
The whole thing is very much a work in progress, an experiment in one state with the hope that, soon, more states will be able to participate. When they can, the prize pools will surely grow.
But it seems unlikely that turnout will improve significantly this NFL season. The single-state player pool is limiting.
And the results of the first week, with nearly half of the entry money rolled over to future players, will only serve to further turn off the 5,181 bettors who came up empty last week.
Photo by Ronnie Chua / Shutterstock.com
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