Monday, January 26, 2015

UK Racing Is No Longer Doing What it Does Best

What do you think of when you hear the words "a UK horse race"? I think of big fields, and being able to bet a horse with a decent shot at 6-1. Maybe you do, too.

For what seems like forever, the UK racing product's space in the market was win betting - whether at a bookmaker or exchange. When you picked up a book like the excellent Dave Nevison's No Easy Money you read about his replay watching and his "tissues", where he would be focusing on one thing and one thing only: Win betting. No exactas, or scoop sixes, nothing of the sort. 500, 1000, 2000, on the nose please.

If you study marketing, you learn that being first in a prospects mind is most important. For others, doing what you do best very well, is a way to stand out in a crowded market. For horse racing, slices, not the mass market is most important, simply because of the variety of gambling games offered, especially in Europe. Horse racing will not outcasino a casino. The UK racing fixtures, with win betting and big fields, with low juice, were a big winner for that sport. It was first in any racing prospects mind, had been for generations, and offered gamblers a solid product to bet on.

Since then, these very things that make UK racing UK racing, are being attacked. And it is not going well.

The pink line is the UK. On the left, the number of races have grown fairly dramatically, on the right, we can see the quality of these races were poor, where average wagered per race sunk like a stone. Field size - a big draw for bettors - was close to 12 horses per race in 2001. In 2012, it was a shade over nine.

Fewer racedates does not automatically mean lower handles (don't let the US racing media tell you this; Australia cut dates and increased handle in 2007 and Canadian harness racing is in year two of the same thing. It's used as an excuse in North America) . Conversely, more races does not mean higher handles. The UK proves the latter; handle has been down and continues to be.

What is bothering the UK is the same thing spoken about regarding the NFL and horse racing in the TDN this weekend. They have lost their way. They are in the process of losing their entire edge with customers.  The UK does not need to diversify into exotics like they have, nor do they have to keep expanding their offerings. They need to remember who they are in the prospects mind.

In the 1950's Pepsi was getting slaughtered by Coke, earning less than 20% of the entire share. There was not much they could do, so they thought, but they developed a new strategy. This entailed not going after coke but going after a slice of the market - teenagers. This strategy began to work, and using 80's pop icons like Michael Jackson it continued. After one generation (no pun intended) Pepsi closed the gap where coke's market share was only 10% more than Pepsi's.  At that time Pepsi pivoted again, going after the mass market. That backfired.

It's this writers opinion that if UK horse racing wants to earn back gambler market share, they have to return to what they were best at. They're not going to win trying to sell higher rake exotics. They're not going to win racing more races with shorter fields. They're going to win being the best at what they've always been best at: Win markets, low rake, and big fields.

Upstart, Relaxed Horses, Dez & the NFL

Good morning everyone. Here are a few items that caught my eye.

Upstart was a very handy winner of the Holy Bull on Saturday. This looked like a really nice horse last year, but after his tough Juvy and time off, you just never know how sound and happy they come back. As his trainer said "They need to leave horses at some point, and he kind of did that yesterday". I'm a big fan of this horse but I can't help but think last week's 40-1, which looked like an overlay, this week will be an underlay.

Upstart got a good trip, moved and separated when asked,  ran a good number (a 107 TFUS number), did so willingly and like a good horse should, and looked sound afterwards. There's simply not much not to like. 

With some closings on the east coast, GP's handle on Saturday was good. 

I was very interested to read Don Swick's comments in HRU (page 7, pdf) this weekend. Don, a long time harness trainer, moved to the thoroughbreds as well and now trains both. Harness horses are constant work - rigging, shoeing, equipment - and keeping them sound because they race so frequently teaches one to be a damn good horseman.

On what's more difficult about training Thoroughbreds: "Reading the condition book"
On their soundness: "Their ankles can't handle it [hard training]"

He also has some fantastic comparisons to how thoroughbreds are constantly , "clamped down" rather than relaxed like is so important with harness horses. "Vets and blacksmiths are amazed how that within two or three weeks in my barn they act like normal horses, not Thoroughbreds".

A trainer training horses to be relaxed, happy and "normal". Sounds like a harness trainer.

In HRU Friday (page 5, pdf) the judges in other sports versus racing was looked at. Racing's are better.

Story in the TDN this week looking at how serious the NFL gets regarding anything that weakens the fan link when it comes to integrity. It went on to compare how racing did not stick to its core principle (a gambling game you can win at) and has suffered for it. The NFL, a violent sport, in a society that is hell bent on weather warnings, safety seals, and tearing up monkey bars in playgrounds, continues to buck convention by thriving; $17B TV deals, in a sport that does not have a world stage to fall back on. The NFL has been teathered to the modern American sports fan like no other sport this side of the pond. It took a long time to do that.

Flipping over to racing, one of my favorite dudes on the twitter (Dougie Sal) often posts racing links from 1912, or 1918, or 21, regarding the gamblers of the day. Tim Mara took $2,500 he probably made from booking the card at Belmont and bought the New York Giants (how is that for irony today), pros were alive and well, earning a living at the track.

One sport went from very little to everything, and one sport went from everything to very little. It has a lot to do with "KYC" - know your customer.

The NHC winner pocketed $800,000. Congrats to Mr. O'Neil. A little bird told me Mr. Dinkin will be writing about the NHC in this month's HANA Monthly emagazine. That should be out this week.

Have a great Monday everyone.

Thursday, January 22, 2015

The Judges Do Things Right

In tonight's Harness Racing Update, there's a column looking at how our judges judge, and how other leagues do things wrong. You can read it here 

Also in what I thought was a very good edition was Gural not allowing Traceur Hanover to race in the Meadowlands Pace, and news on Maven and her quest for a Prix D'Amerique.

Wednesday, January 21, 2015

Fascinating #DeflateGate Racing Parallels

I must say I am having a hoot reading the media (and social media) regarding DeflateGate - the fact/rumor that the New England Patriots (illegally) deflated balls in their last game (they are easier to grip and throw).

What's making it extra-special is that the stories and tweets sound almost exactly what happens in horse racing when some winning trainer gets nabbed. It's uncanny.

The Washington Post today has some prose up that could be on the Paulick Report or the DRF.
  •  “The Patriots are suspected of cutting so many corners, their home field should be an oval,” -  (aka "pushing the envelope")
  • But numerous coaches said they don’t trust how the Patriots go about their business — complaints that go back to the beginning of Belichick’s tenure as head coach in 2000. - (we can't catch him, but we're pretty sure)
  • Belichick, for his part, claimed he had misunderstood the NFL rules. “The rules are very, very clear,” former Tennessee Titans Coach Jeff Fisher told the New York Times in 2008. “There is no need to be more specific or clarify any rules whatsoever.” (the kicking, cut off times, overages, rules are unclear, I had no idea I could not bring Air Power into the detention barn!")
  • The Patriots’ reaction to such allegations has been to chuckle. Other teams are just grasping, the thinking goes. They’re just jealous. (aka he's just jealous that I win)
On social media we see similar.

After a dude gets a soda positive, often times, it's "the horse didn't even win" defense. In this case, the Pats won by so much, they didn't have to cheat to win, even though they probably cheated to win. This is a form of social media and chat boards' NYRA-Apologist Disease ® where they might've done something wrong, but it does not really matter:
Then we have the classic horse racing line "Everyone does it!"
And, well, neither here nor there, but kind of witty, I thought. I suspect the biggest difference between this Deflategate and horse racing is that 1) The investigation will be over in 48 hours and 2) if found "guilty", the punishment will be done quickly, and hurt quite a bit.

Have a nice Wednesday everyone.

Tuesday, January 20, 2015

Paging a Leader

Someone needs to get a hold of this industry and lead, or everyone will be racing for ribbons.

Read more

Mid to Low Range Racing Stock Ownership Sets off Alarms

I was reading a little bit about gross horse betting turnover, both in North America and abroad recently, and noticed an interesting article regarding Irish racing.

"In 2014, the number of horses in training fell by 6.4pc, owners by 6.2pc, entries by 12pc ..."

This is occurring in tandem with increases in prize money: "What was most galling about the 2014 figures is that the contraction at the industry's core continued despite an increase in prize money of 6pc, with another 10pc extra due to be pumped into purses this year on the back of a 25pc increase in Government funding."

In addition to that increase in gross purses, there has also been a decrease in races held: "Despite real activity - including field sizes - plummeting, the number of fixtures has swelled by 16pc since 2004 to 355."

More money to be raced for, more horses earning checks with smaller field size, more government help, but fewer owners.

This has not been noticed on the high end, however: " bloodstock sales, which was up 19pc."

In North America we see similar in horse racing. In fact, almost every time a takeout hike is considered by a horsemen group, it's to somehow "raise purses" because if that happens, all will seemingly go swimmingly by increasing ownership.  That doesn't happen.

At the high end things seem fine. With QE number 44 (not sure what number we're on), Apple up a gazillion percent and high end horse buyers heavily invested in the markets, this makes sense. However, the ecosystem can't survive in its present state without the lower ends having some success. You need a secondary market to buy outcasts from the top end, and offer them a chance at profit. That profit is not there.

This is occurring with more and more slots revenue to dozens of "B tracks" both in harness and thoroughbred. It's occurring with more and more government help.

Currently, higher ups policies are very top-end driven - eliminating race day drugs, lasix, diverting more and more purse money to Grade I's and stacking stakes - so one wonders if the middle to low end issues will ever be addressed. However, that day might have to come, because if the low end continues to be hampered, the top end will feel it, sooner or later. It's just math.