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Sunday, March 13, 2011

A Case for Guaranteed Pools and Lower Takeouts; Examples of Innovation

With all the news coming out of California, it is probably a good time to take a look at how Cal Expo is doing in particular with its Pick-4 promotion.  Unfortunately, regarding their overall program, the boycott of thoroughbred racing has not benefited the harness program at Cal Expo.  Whether it is general anger towards the takeout hike or an assumption that Cal Expo has also hiked their takeout, it is hard to gauge.  Then again, it may be there is minimal crossover between the three breeds. 

As for the reception of their Pick-4 promotion with the 15% takeout rate, it appears there is little improvement in their numbers for their early Pick-4.  This is probably due to the saturation of tracks racing at the same time.  You have the Meadowlands, Maywood/Balmoral, Northfield and other tracks all simulcasting at the same time.  With Cal Expo's horse quality admittedly inferior to the quality of racing at the Meadowlands, it is likely gamblers are showing preference to the Meadowlands guaranteed Pick-4.

However, their late Pick 4 on Saturday nights is a different story.  For those of you who remember, not only does Cal Expo offer their 15% takeout, they guarantee a $10,000 pool for the Pick-4.  In addition, if you wager at Cal Expo or through a Twin Spires ADW account, there is in effect no takeout on your winnings as Cal Expo and and Twin Spires pays a 17.5% bonus which cancels out the take out's effect.  How successful has the late Saturday night Pick-4 been?

On track, the late Pick-4 has increased handle by 11%.  As for wagers made through TwinSpires, their handle has increased 281% for the Pick-4.  That's right, 281%..  Combining the wagering on the late Pick-4 overall, the total handle on the late Pick-4 has increased 29%..  Not bad for a track where the late races are run after the Eastern tracks are done for the night and TVG is basically ignoring their program, at least on live television.  Needless to say, Cal Expo will be continuing the promotion.

Could you imagine how Cal Expo's Pick-4 would be burgeoning if all ADWs were able to participate in the 0% takeout rate promotion.  Sure gamblers get the advantage of a 15% takeout and a guaranteed $10,000 pool, which is worth something, but for those gamblers who don't have or don't have access to TwinSpires ADW account, they lose some of the incentive to wager on the Pick-4.  It would be nice if all ADWs could participate in this wager, but that is not likely to occur (though some ADWs run occasional bonuses as promotions).

So once again, Cal Expo proves that reduced takeout and guaranteed pools helps increase wagering.  But thanks to Cal Expo and TwinSpires, we see how successful 0% takeout wagers are.  If each track could have one exotic wager a night where there was no takeout; perhaps a contribution from the purse account, we could see wagering improve at all tracks.  And with regards to the stable situation with their early Pick-4, it shows how simulcast saturation can hurt the advantage of any takeout reductions.  For racing to prosper as well as it can, we need to cut down on the number of tracks racing at any given time.  Not saying contraction (thought it seems inevitable), but shorter racing seasons.  Perhaps if we get a Canada One type format in the United States, race track signals can be coordinated so each track gets their time in the spotlight.

The money is there, we just need to give the gamblers a reason to play it.

News Item: Zweig Changes Format - Starting with the 2012 season, the format of the Zweig Memorial and Zweig Filly statkes will change to eliminate divisions, adopting a format where the top nine horses with respect to money earned will race for $400,000 ($170,000 Filly) with a consolation for the next nine horses.  While the Zweig never had eliminations, which is the bane to standardbred racing, it is a good sign that they have decided to make the stakes a big money event; bringing the best three year old trotters to Vernon Downs in 2012. 

News Item:  Delaware County Fair Racing at Night? - Purists can breathe a sigh of relief, for now.  There is a proposal to add lights to the Delaware County Fair to increase wagering and interest in their early week program.  Currently, Jug week is run during the day time Sunday thru Thursday, but there is so little interest on the early week program that there has been for the last couple of years no simulcasting of the races early in the week.  The costs for night racing would be minimal this year as the track would be lit by temporary lightning.  Post time on Monday and Tuesday will be at 5pm with Sunday, Wednesday, and Thursday remaining daytime cards.  Like all tracks, Delaware needs to innovate, The New Century Races which were limited to Ohio-bred horses has been replaced with a series open to horses throughout the country.  With the new races and night time racing, I would expect simulcasting of the early days of Jug week will return as there will be more interest on the national level.  A final decision on holding evening racing will be made in April. 

News Item: Mohegan Sun at Pocono Downs Hires Marketing People - What makes this so special?  According to an article in Harness Racing Update, these individuals were hired directly to market harness racing.  That's right, a gaming company is spending money on attempting to market harness racing.  From the time the horsemen helped pay for naming rights to a local arena, I felt unlike Chester Downs, here was a gaming company who was committed to making harness racing work within their facility.  For sure, slots and table games are their bread and butter, but they are looking at harness racing as an additional gaming product to differentiate themselves from other gaming halls.  They are even considering making a bid for an encore performance of the Breeders Crown in 2012.

News Item: George Morton Levy Series Begins in Two Weeks - Perhaps it is fitting as the Meadowlands closes their winter meet, that Yonkers Raceway kicks-off perhaps the best FFA pacing series in the country with the George Morton Levy Series on March 26.  The Levy has always been one of my favorite series as the top horses go at it for five weeks of preliminaries ($50,000 each) before the $200,000 final.    Fifty-nine horses have been nominated for the series.  Some of the horses nominated are Atochia, Barber Pole, Blueridge Western, Corky Baran, Foiled Again, Mccedes, Southwind Lynx, and Valentino.  No, this event does not feature the top FFAllers in the country as they have not yet begun their season, but find me as deep an event for a winter series.  Mares are not ignored either with the Blue Chip Matchmaker Series which features five weeks of $40,000 eliminations and a $170,000 final;  with 44 horses being nominated.  We will be covering the Levy races once the season begins.

News Item: VFTRG Poll Results are In - Far from a scientific poll, VFTRG ran a poll asking readers the following question: In the Event the Meadowlands Closed What Would You Do?  The results were:

I would wager on my home track - 4 (7%)
I will wager on another track -     25 (47%)
I will change over to the runners -  5 (9%)
I will stop wagering -                     5 (9%)
No big deal; I don't wager
on the Meadowlands anyway -   14 (26%)

Now we didn't ask if they will be wagering the same amount, but based on the survey, 82% of the horseplayers which responded would continue to wager on harness racing.  Will it be the same monetary level; likely not., but we are not facing an exodus of horseplayers either.  Tracks may be smart to plan for promotions to win gamblers over to their own product.

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