DraftKings had a challenging Tuesday. Shortly after reversing its controversial decision to tax certain winning bets, the leading sportsbook mistakenly sent a mass email to bettors about golf wagers they never made.
Earlier that evening, DraftKings announced it would no longer implement a surcharge on winning bets in states with high sports betting taxes. This decision came after FanDuel’s parent company, Flutter Entertainment, reported in its second-quarter earnings that it wouldn’t follow DraftKings’ lead in imposing a levy on winning wagers.
DraftKings cited customer feedback as the reason for retracting the fee, which it had described as “fairly nominal.” However, the sports betting community strongly criticized the proposed surcharge, which was revealed to exceed 3%. Social media backlash against DraftKings was swift and intense, with many questioning the company’s initial consideration of the surcharge.
In the coming weeks and months, the impact of this tax controversy on DraftKings’ market share will become clearer. Analysts and market research firms will closely examine monthly state wagering reports, which break down handle and revenue by operator.
Golf Email Misfire
As the sports betting community was buzzing over DraftKings’ decision to withdraw the planned surcharge, many customers—and even former customers—received an email regarding their golf bets.
DraftKings’ Dead Heat Reduction rule divides the odds proportionally among the number of winners for a particular position, resulting in a smaller payout than if only one golfer had finished in that position.
The email also informed bettors they were being gifted a bonus bet as a “one-time courtesy.” However, none of the recipients had placed golf bets that resulted in the issue mentioned in the email.
DraftKings did not send a follow-up email asking recipients to disregard the previous communication. Instead, they addressed the mistake on social media.
Competitors Seize the Opportunity
Reports indicate that the DraftKings email was sent to individuals who had never even registered with the sportsbook.
Some recipients of the erroneous email have expressed frustration and indicated they’re taking their sports betting business elsewhere.
BetRivers Sportsbook has been active in the discussions surrounding DraftKings, offering assistance to those looking to open and fund new accounts.
DraftKings’ competitors, including BetRivers, Caesars Sportsbook, and BetMGM, are seizing the opportunity to attract disaffected customers, having already stated they would not impose taxes on winning bets.
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