Fanatics CEO Rubin Says Sports Betting Advertising Could Hit $7B in 2027

Amid intensifying competitive pressure from prediction markets, regulated sportsbook operators could spend as much as $7 billion on marketing, including advertising, next year, according to Fanatics CEO Michael Rubin.

He made the remarks in an interview with CNBC earlier this week. Rubin recently estimated that privately held Fanatics could spend as much as $1 billion next year on betting and gaming advertising, or nearly triple the $350 million the company will spend this year.

He said that $7 billion figure applies to “the overall marketing space” for sportsbook operators, adding it “couldn’t be any more competitive” as he rattled off the names of some major prediction market operators.

As Sports Betting Spending Surges, Fanatics Has Advantages

While there are a few well-capitalized contenders in the sports betting arena, Fanatics has some advantages. Those include its status as a private company, meaning it’s not beholden to satisfying Wall Street and public investors in three-month intervals.

Additionally, Fanatics has leading positions in the sports apparel and collectibles businesses. Rubin said those units could generate over $12.5 billion combined this year. Fanatics has the luxury of being able to funnel profits from collectibles and merchandise to betting and gaming.

Rubin discussed the possibility of consolidation in the sports betting industry, telling CNBC that there are five well-capitalized competitors in the space — DraftKings (NASDAQ: DKNG), Flutter Entertainment’s (NYSE: FLUT) FanDuel and Fanatics as well as the top two prediction market operators.

He said that he’s “not sure” what the level of consolidation could be among those five giants over the next several years, acknowledging that the industry is “super-competitive” and that there are likely to be plenty of tussles over the next few years.

‘It will not be a fun next couple of years’

Rubin acknowledged that industry observers are negative on sports betting and that due to increasing competition, “it will not be a fun next couple of years.” However, he is constructive on the business long-term, telling CNBC that his five- to 10-year outlook is brighter than what the current landscape suggests.

Rubin believes sports wagering is a fundamentally sound business and one that fits very well in the broader Fanatics ecosystem.