Horse Racing Consultant Gets It In A Big Way

[Horseplayersbet.com]

http://www.horseraceinsider.com/blog.php/John-Pricci/comments/10162009-consultant-amount-of-money-taken-from-bettors-is-not-sustainable/

[DeanT]

Friday, October 16, 2009

When The Sink Backs Up, Call a Plumber (http://blog.horseplayersassociation.org/2009/10/when-sink-backs-up-call-plumber.html)

There has been much chatter on takeout. At HANA we are happy about that, because it is a main platform plank, and we believe that it is vitally important. But as with much in racing, and its nebulous leadership, opinions come from pretty much everywhere. The morass of opinion seems to muddy the waters, not clear them.

Here at HANA we have not been nebulous in our looks at takeout, we have formed opinions based on one thing: Listening to gambling experts, whether they be consultants, gamblers or published study authors (http://blog.horseplayersassociation.org/2009/09/takeout-some-fat-cat-republicans.html). We have tried to ignore the tangential opinion that is presented without fact.

One such person we have learned from is Wil Cummings. When Mr. Cummings was with Christiansen Associates he authored a comprehensive paper that we link quite often. In fact, you can read it too, here (http://www.horseplayersassociation.org/articles.html). If you are interested in learning about takeout, what it does, and how high prices have hurt racing, it is a must read.

Eugene Christiansen is one of those experts. He recently presented at the TRA conference. John Pricci, who was there, reported on that today. (http://www.horseraceinsider.com/blog.php/John-Pricci/comments/10162009-consultant-amount-of-money-taken-from-bettors-is-not-sustainable/) “Racing as an industry is more resistant to change than anything we’ve ever dealt with,” said Christiansen.

And that change is most resistant in pricing, something that Mr. Christiansen believes is far too high in our sport. “The fundamental problem is consumer pricing. The amount of money taken from bettors is not sustainable.” he said.

The comments on articles like the above are numerous, and sometimes troll bait. But invariably there will be some from a trainer or owner, or track exec. Someone who might train a horse, own a horse - someone who does not bet the game, and that comment will often times say "Mr. Christiansen is nuts. Takeout does not matter!"

Mr. Christansen, I am sure, if he needed advice on where to enter a maiden two year old, or what type of equipment change a horse needed, or if his colt should try the turf, will ask his trainer's advice. Because after all, his trainer is an expert on horse training and he is not. I guess my question is, why do some people (who know very little about gambling) not take his advice as a gambling expert the exact same way?

When my sink backs up I call a plumber. I do not call an electrician. Right now in racing we seem to have too many electricians fixing the toilets.

Racings pricing is too high. It is not even debatable any longer. The question now is, how low is too low. It is something, with people like Mr. Christiansen's help, we hope to find out. We just have to listen to people who know. It is right in front of us.

[DJofSD]

Right on, Dean, right on. Well said by you!

[lamboguy]

racing is in a steep downward spiral. with rebates i am playing at the same rates that were around in the 1960's. is that doing anything to increase handle?
NO
a huge percentage of the game is coming from players like myself that sit at home and bet where they get the lowest takeout. i really don't see how racing can go to much lower than what i pay after my rebates.

the problem in racing remain's lack of interest. takeout is not the first thing that a prospective newcomer into the game might look at. i am not saying that that person will be completely blind either. no living human wants to get robbed with the high takeout that exist's when you walk to the window without a rebate.

we should focuss in on how to get more people into the game and look at every single component not just takeout.

[DeanT]

racing is in a steep downward spiral. with rebates i am playing at the same rates that were around in the 1960's. is that doing anything to increase handle?
NO


Of course it does. Lower takeout means more handle. If you start with a $500 bankroll at 22% takes instead of what you get now, you would bet at least 5 or 6 times less money.

we should focuss in on how to get more people into the game and look at every single component not just takeout

I agree, but lower takeout works to get new people in the game, because they can play longer and have a good time playing longer. The millions who play poker might have jumped in because they saw it on TV, but they stay because they can put $100 in a pokerstars account and last for months, or put $30 in a touney and pass the time with a shot at winning.

comment on John Pricci's piece about new players with low take:

Hi Eric and all,

I presented an interesting (I thought it was, anyway) story at a conference in April that Eric might remember, on takeout.

An example I used was a story of a young man in the UK who was a newbie. He had never seen a race, never been to one, never bet one. But one day he heard of a horse racing betting course at Betfair. He was a 23 year old computer science grad and it interested him. He learned the course, and began betting. He bet into 4% takeouts at betfair.

He lost for awhile as he learned. But he won just enough to make him think he could make money playing horse racing.

In 2009 his hard work payed off and he has won well over $300,000 so far. His story is here. http://adamheathcote.blogspot.com/

He has now become a “young fan” we need. He brings his friends to racing too, and has traveled to the meets to watch racing live. I would submit he would be a fan for life, both on track and off track betting at home.

The kicker is: If takeouts were 22% like here, and he had to bet into the teeth of it, he would not be a player for life. He would have gotten beaten up, quit, and switched to poker or sports betting. He would have lost his shirt because his edge is probably not more than 1% doing what he does.

For horse owners like me, he has probably contributed about $100,000 or so to purses during his journey so far in 2009. That is $100k that is a big fat zero if takeouts were higher. I did not get 95’s in University math, but from what I learned, $100,000 revenue from a fan for life to horse racing is better than $0 revenue to horse racing with a fan who is now playing poker.

Right now our takeout is too high. Mr. Christiansen knows that because he is a gambling expert and he knows stories like this young person’s in the UK. He knows how much is churned when it is lower, and he knows that to attract new bettors in a skill game (like horse racing and poker) you have to be innovative, and beat other games on price. I hope that someday racing joins in with this thinking and we can move the game forward with 23 year old kids like this chap. We are going to need them.

[LottaKash]

Good to hear about some serious studying being done, even if falling on deaf ears....

We players (HANA) must keep on making these squealing noises, as the maintenance man always greases the squeaky wheels first....Perhaps persistence wil pay off on this premise eventually...

I say, at the very least, take care of the "loyal" ones first, that will at least keep the status quo, and keep the game running, until there are better fixes & ideas that can lure new fans and players into this game....

best,