CINCINNATI — Before you reach for your phone to bet on March Madness, perhaps you'd like to know which betting app is the best at extracting "commercial value" from its customers.
That's why the WCPO 9 I-Team ranked seven apps on the percentage of revenue they retain from all wagers placed. It’s known as a hold percentage, and it varies widely among sportsbook rivals.
FanDuel leads the pack with a 12.4% hold percentage in Ohio, Kentucky and Indiana, based on state disclosures for the 2024 calendar year. FanDuel generated $678 million in revenue from $5.5 billion in betting activity in all three states.
Draft Kings, which ranked second with a hold percentage of 10%, placed $337 million more bets than FanDuel. But it raked in $96.5 million less revenue from those bets than FanDuel.
Bringing up the rear in this ranking was Caesars Sportsbook, with a hold percentage of 6.6%. That means 93.4% of its $756 million in wagers were used to pay winning bets last year.
These numbers are not meant to suggest that one app is better than others. And it doesn’t indicate how likely you are to win your next bet. But it is a snapshot that shows how online sportsbooks are conducting their business in the Tri-State, where legalized sports betting is now a $16.2 billion industry.
The I-Team has previously reported on hold percentages at 90 retail and online sportsbooks that operated in our three-state region in January 2024. That story showed how introductory bonus offers were skewing results in favor of bettors. This analysis focuses on a more mature betting environment, where seven companies account for 96% of all betting activity.
Those companies have garnered lots of attention for setting bet limits on successful customers, voiding bets that would otherwise cost them too much money and using “VIP hosts” to boost spending by prolific bettors.
WATCH: Ranking how much apps share with Tri-State bettors
At a Massachusetts Gaming Commission hearing on bet limits last May, responsible gaming advocate Brianne Doura-Schawohl urged regulators to explore links between sportsbook marketing practices and gambling addiction.
“How many people are being limited for problem gambling concerns?” Doura-Schawohl asked. “Data in other markets suggest they are not being limited at the same rates maybe winners are because they are heavily relied upon to build the revenue of the business.”
More than 500,000 people have a gambling problem in Ohio, Kentucky and Indiana. That’s about 2.4% of the total population, according to figures cited since 2022 by the Ohio Casino Control Commission, Indiana University and Kentucky’s Department of Behavioral Health.
“Typically, what we’re seeing is folks get into financial issues and relationship issues,” said Cindy Chizewick, owner of Brighter Days Wellness and Recovery LLC. She’s a licensed social worker who has treated 15 people for gambling disorders since 2023. “By the time they get to me, they are struggling with addiction. So, they are overspending.”
Chizewick said her clients are impacted by sportsbook marketing tactics, including ads that create an urgency to gamble and bonus offers that incentivize more frequent bets.
“Yes, they do continue to place more bets,” she said. “Yes, they do continue to spend more money than they want to. Have they said it’s directly because of the information that’s coming across, like free money or what have you? Yes, that has been discussed, across the board.”
The I-Team requested an interview with FanDuel because it ranked first in our analysis of hold rates. It declined to talk but provided a statement.
“FanDuel believes that sports betting is meant to be a form of entertainment and customers should play within a budget only betting what they can afford. We encourage anyone betting on the upcoming college basketball tournaments to include our suite of tools including Deposit Limits and Wager Limits in their play and to review their activity through FanDuel My Spend, a personalized responsible gaming dashboard that was utilized by approximately 3.5 million customers during the NFL regular season.”
FanDuel was more forthcoming in September when it briefed investors on its latest innovations to boost revenue and profits.
“Over the past year or so, we have made a tremendous amount of investment in our data models and our customer segmentation,” FanDuel Sports President Mike Raffensperger told the Wall Street crowd on Sept. 25. “This has ultimately led to a far greater ability to send more rewards to more customers, subsequently driving more bets and revenue from those customers.”
FanDuel is owned by Flutter Entertainment, an Irish company that’s known for betting platforms that deepen customer loyalty by “distributing generosity” in the form of promos and betting bonuses.
Raffensperger said FanDuel has focused on “putting the right amount of generosity into the right customer’s account at the right moment.” In the past, he said nearly 40% of its bonuses went to “folks who are coming to our platform and primarily just chasing our promotions.” By cutting bonuses to those customers, “we’ve been able to reinvest that money into our best and most valuable customers,” Raffensperger said.
Another area of innovation involves parlay bets, in which gamblers combine two or more bets into a single wager. FanDuel was the first to introduce same-game parlays in 2019. It expanded its capabilities in 2022 with products that let bettors track each leg of their parlay. And last year, it introduced new graphics “so customers can follow along every sack, field goal, fumble in a super-exciting and dynamic way,” Raffensperger told investors.
Because parlay bets are harder to win, they tend to be more profitable for sportsbooks. Raffensperger said they bring two advantages to FanDuel.
“One: Players that participate in parlays actually retain on our platforms at greater rates than those that don’t because of the really great entertainment value that a parlay provides,” Raffensperger said. “And two: There is a higher structural margin element to the parlay products, so Fanduel extracts a higher commercial value from those players.”
In its most recent annual report to shareholders, Flutter Entertainment credited parlays with boosting its profitability by two percentage points to 13.8% in its 2024 fiscal year.
As a business owner herself, Chizewick was impressed by the tools FanDuel uses to deepen customer loyalty and boost revenue. But as chair of the community outreach committee of the Problem Gambling Coalition of Southwest Ohio, she wonders about phrases like extracting commercial value.
“I don’t really know what that term means,” Chizewick said. “Is it extract everything that they can? Is it extract everything that the customers can give?”
She applauds FanDuel’s My Spend product, but questions how FanDuel and its customers are using that information.
“That’s the bottom line, if they’re using it and they want to know how much they spend,” Chizewick said. “Is this too much spending or not? Maybe have those conversations, maybe have focus groups with the members like that, the consumers. And ask questions, ‘Do you know what the risky behaviors are? Do you know where the resources are if you go over the line? How can we help you with that?’”
Chizewick would like to see state regulators conduct more research on the link between sportsbook marketing techniques and gambling addiction. But in the meantime, she’d like bettors to learn more about the warning signs of problem gambling and where to find help if needed.
“All the resources you need are right there at your fingertips, just like the parlays in the sportsbooks,” Chizewick said. “So, if we push that just as much and you have that going on in advertisements, you get to choose.”
If you're concerned about someone with a gambling problem, here are some resources:
Ohio for Responsible Gambling can be reached at 1-800-589-9966.
Indiana’s Problem Gambling Referral Line can be reached at 1-800-994-8558.
Kentucky’s Department of Behavioral Health urges people with gambling issues to call or text 1-800-GAMBLER (1-800-426-2537).
