How Does Fantasy Football Make Money?

Fantasy football is a $1 billion industry according to Fox Business Journal, and there are currently between 15 million and 18 million fantasy sports users today, with about 85% of them playing fantasy football according to CNN money. But how does this industry bring in such great revenues from what most people use for free? Multiple providers have different views on how to make their money off fantasy football. Yahoo!, and CBS are two of the main providers of fantasy football, but they have different views of how to produce money off of their services.

Yahoo is the biggest provider of fantasy football, nearly doubling the amount of users last season of other big name providers such as ESPN. Their dominance in the fantasy football industry is due to the fact that they push their free services more to their customers, rather than trying to sell premium services for a fee. This is why many marketers believe they have been able to hold on to the majority of the market share for so long. Their belief is that by allowing for their services to be completely free draws more traffic to their website. With more traffic being brought into Yahoo!, it allows them to generate higher revenues through the use of more advertising. The more traffic on the website allows for new consumers to choose their free services compared to other providers that charge for their premium leagues.

CBS is another leader in the world of fantasy football, but they have a different point of view on how to generate revenues. Unlike Yahoo!, CBS Still believes in their premium services to draw in consumers. Although they do have free services on their website due to the free competition of their competitors, they believe promoting their premium products is the best way to bring in money to their company. CBS believes they promote to “high end” customers which also allows them to be appealing to advertisers, stating their fantasy football advertisement inventory has been sold out for the past three years.
Both these companies do an exceptional job of using different marketing strategies to draw in customers to their websites. Although they use different tactics, they both seem to be effective in their own way. Fantasy football is a fast growing industry which advertisers are going to keep a close eye on to ensure they don’t miss out on the potential profits to be made.