CTT NA ISSUE 27 v2_Jerkins feature.qxd 01/02/2013 12:43 Page 10
CALIFORNIA THOROUGHBRED TRAINERS
Where went the marketing?
T
HESE days, there is more and more chatter about the necessity of “better marketing” for racing, now that the sport seems to be bumping along at the bottom of a trough of historic lows in attendance and public interest. We’ve been there before, I suppose, but things were never this bad. Just consider the fact that many tracks do not even report attendance any more or, when they do, the figures are either terrifying or so bogus that nobody can seriously believe them. What a change from 40 years ago, when the handle might be a subject of some interest from time to time, but almost all of us concentrated on attendance as the best barometer of public interest and industry health. After all, reported handle is subject to all kinds of distorting factors, whether short fields, off tracks, numbers of races run per day, numbers of pools offered, inclement weather, or – most important – inflation. Purse levels have always been of interest to horsemen, of course, but as for the public, purses count mainly when they’re gigantic: the original “hundred-grander,” the Santa Anita Handicap, the Arlington Million, the Breeders’ Cup. That is to say, when they are featured in track marketing. When you stop to think about it (which we seldom do), it is remarkable that millions of dollars in prizes are distributed to the connections of race horses based on the outcome of a sporting contest which takes just a minute or two to contest. That’s why the Derby existed so long on the premise of “the most exciting two minutes in sports.” As for purses, as long as approximately 80%
08 TRAINERMAGAZINE.com ISSUE 27
By Alan F. Balch CTT Executive Director
“The mantra is always the same: what you lose at the track you will more than make up with the volume of betting away from the track. And it has never been so” of purses are won by 20% of connections – an 80/20 rule of longstanding and only barely heading toward 75/25, last I checked – nobody can seriously think high purses will save the sport. Since attendance figures are seldom credible, pundits now concentrate on handle. Despite the drawbacks of doing so. And the latest drawback is wondering if everyone’s even counting the dollars the same way, which we are given to believe they may not be. In any event, according to Equibase, the handle on U.S. Thoroughbred racing in 2012 was $10.9 billion. In inflation-adjusted terms, according to one method, that’s about 60% less than the total handle in 1987! I’m inclined to believe it, since Santa Anita handled $543 million in 1987 all by itself, all at the track, in less than 90 days of racing at its winter/spring meeting. By any measure, racing has fallen a long, long way in public interest, in a very short 25-year generation. If any sport needed
massive marketing to resuscitate it – or massive something – it’s racing in the United States. The first fundamental question is whether it’s too late. Remember, American racing has been in the doldrums many times before over the last century, including the early 1970s. In thinking about this seriously, and trying to account for all the differences in the marketplace just since then, a few key issues are worthy of attention. Generally speaking, investing in marketing requires a strong belief in future prospects for the product or brand to be marketed. Racing certainly had that 40 years ago, despite plenty of predicted doom. A wave of marketing ingenuity gradually engaged the country, tracks competing against each other, to outdo one another in innovation, facility improvement, purses, and methods to draw fans. Some of it didn’t work, much of it did, and this ongoing investment ultimately resulted in the high-water marks for the sport in the mid- to late-80s. Unfortunately, that very success opened the door for an accounting and consulting mentality that predicted still greater enrichment from the introduction of virtually unlimited simulcasting, off-track, and telephone account wagering. “These will be different fans, new markets,” we were told. Much the same speeches, in fact, that we now hear from advocates of exchange wagering. New York had been the first major center to be afflicted with the perils of off-track betting, and 25 years later, the same predicament gradually afflicted the whole country. The mantra is always the same: what you lose at the track you will more than make up with the volume of betting away from the track. And it has never been so. I always used to preach that the time to invest the most in marketing is when you have the most to do it with, to keep a product or brand on the “crest of the wave.” If you don’t do it, if you don’t keep the wave rolling, there will come a time when you don’t have the means to generate the wave again. And so it has come to pass. Track executives increasingly saw the opportunity to make short term gains at the bottom line by aggressively cutting the marketing “spend,” as they saw it (“investment,” as I see it). More than one said to a self-satisfied board, “You see? We put almost all of those marketing dollars we cut right onto the bottom line.”
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