How Racetracks could increase on track attendance

[Horseplayersbet.com]

Originally Posted by andymays

If you can't make it to your local track then you pay a higher price. They are offshore anyway aren't they?

If you want to get people to the track a big discount will do it.

Sports betting on track and satellite only (not online) will work as well. They could at least try it for a few years.

You are competing with other forms of internet betting. I don't see this as being a viable option other than it gives the smaller players who don't get rebates in many jurisdictions a reason to go to the track.

[andymays]

Originally Posted by Horseplayersbet.com

You are competing with other forms of internet betting. I don't see this as being a viable option other than it gives the smaller players who don't get rebates in many jurisdictions a reason to go to the track.

I think the opposite. You would get hundreds of players with 10k or more in their pockets at the track to play live at those rates.

[Horseplayersbet.com]

Originally Posted by tzipi

For one,Massachusetts lowered their takeout. They knew if they did,it would explode and it did because people got more money back used the money to bet some more. Massachusetts is the most successful state in terms of lottery revenue and they have the lowest takeout. Coincidence? I doubt it.

Increasing prize payouts

A proven strategy for lotteries across the country to generate additional funding for their beneficiaries has been to increase prize payouts. Higher payouts generate more winning experiences for players. This makes the games more entertaining and increases sales dramatically. Every lottery in the U.S. that has increased prize payouts has increased sales. [3] The most successful lotteries in the country have one major thing in common, a prize payout of at least 60 percent. There are 39 state lotteries, 36 of which allocate 60 percent or more of ticket sales to prizes. Two of the poorest performing lotteries, California and Louisiana, have a limited prize payout of only 50 percent of ticket sales.

The Massachusetts State Lottery is the most successful lottery in the nation. It also has the highest prize payouts in the nation ranging from 60 percent to 79 percent of ticket sales. With a population of only 6.4 million, compared to California's population of over 35 million, Massachusetts out-produced California in 2002 total revenues by approximately $1.3 billion. [

In New York, the payout for their instant games was increased to 65 percent in 1999. After the fourth year of the program, contributions to education increased by more than $500 million a year with higher payouts a major contributing factor. In 2002, Florida increased instant game payouts from 56 percent to 67 percent. Revenues from these products increased 62 percent in the first year, thereby increasing annual contributions to education by $49 million the first year. In Texas, sales sharply declined from $3.7 billion to $2.5 billion after prize payouts were capped in 1998 at 52 percent. Four years after the cap was restored to its prior level, revenues have steadily increased to $3.1 billion.

Top lottery officials from Massachusetts, New York, Florida, Texas and Georgia have recently stated that higher payouts were instrumental in increasing revenues and generating additional funds for their beneficiaries.
http://cpr.ca.gov/CPR_Report/Issues_...nues/GG06.html

[Horseplayersbet.com]

Originally Posted by andymays

I think the opposite. You would get hundreds of players with 10k or more in their pockets at the track to play live at those rates.

Why? Those players are getting to play with a 10-14% takeout right now on every track. Take it away, and they will either go offshore or just forget about it. Handle will go way down.

Try batch betting at a ticket window.

[andymays]

Originally Posted by Horseplayersbet.com

Why? Those players are getting to play with a 10-14% takeout right now on every track. Take it away, and they will either go offshore or just forget about it. Handle will go way down.

Try batch betting at a ticket window.

Then we're back to the same very very old deal.

What's the solution and how do we get started taking the necessary steps to advance the cause for lower takeout?

Your postition seems to be to wait until the market sorts itself out. Am I correct?

[Saratoga_Mike]

At the advent of simulcasting, tracks never should have sold their signals on the cheap (3% to 4%). That vestige has allowed rebate shops to prosper over the past few yrs, which is unfortunate, imo, as it takes more and more control away from the tracks that put on the show!

[Horseplayersbet.com]

Originally Posted by andymays

Then we're back to the same very very old deal.

What's the solution and how do we get started taking the necessary steps to advance the cause for lower takeout?

Your postition seems to be to wait until the market sorts itself out. Am I correct?

I'm all for giving rebates to those who go to the track, and the idea might very well work for the smaller players who don't normally get them. They will last longer and they will go more and probably expose more people. So I'm not shooting down the idea. But what is the point of getting an established bettor to the track, especially if it might hurt handle in the long run?
If the idea is to grow the game, the idea of giving the smaller players a rebate at the track, I'm all for it.

[andymays]

All I know is that the takeout discussions are getting so old it's sickening.

Nobody has a viable solution for getting it done.

I have a better shot at getting synthetic surfaces out of California than lowering the take. In fact I'm sure they will raise it by February. Then we can cry some more.

[Horseplayersbet.com]

Originally Posted by Saratoga_Mike

At the advent of simulcasting, tracks never should have sold their signals on the cheap (3% to 4%). That vestige has allowed rebate shops to prosper over the past few yrs, which is unfortunate, imo, as it takes more and more control away from the tracks that put on the show!

The game would be in the crapper more than it is today if not for rebate shops.
Perfect example is Woodbine who have a quasi monopoly in Canada on all parimutuel bets.

Their takeout rates suck. Their rewards are a joke.

What I'm saying is that if you leave it to the tracks, the game will die quicker than it is now.

Watch what happens as signals are being sold higher. We will continue to see negative growth.

As long as tracks and horsemen groups fight for pieces of a shrinking pie, the game is in big trouble.

[Saratoga_Mike]

Originally Posted by Horseplayersbet.com

The game would be in the crapper more than it is today if not for rebate shops.
Perfect example is Woodbine who have a quasi monopoly in Canada on all parimutuel bets.

Their takeout rates suck. Their rewards are a joke.

What I'm saying is that if you leave it to the tracks, the game will die quicker than it is now.

Watch what happens as signals are being sold higher. We will continue to see negative growth.

As long as tracks and horsemen groups fight for pieces of a shrinking pie, the game is in big trouble.

Why should rebate shops generate more attractive margins than the track that puts on the show? Probably means they aren't paying enough for their "raw materials" (the signal).

[Jeff P]

From the Oklahoma State Lottery Site:
http://www.lottery.ok.gov/media/docu...2007-12-14.pdf

Excerpt:

Eight case studies support increased prizes
a. Massachusetts – 2094% instant game profit growth in 20 years
b. Texas – 24% profit loss due to legislatively required prize reduction
38% profit growth in 6 years after mandate removed
c. Georgia – 136% profit growth in 8 years
d. Missouri – 46% profit growth in 5 years
e. California – 35% profit growth in 6 years
f. Kentucky – 211% profit growth in 14 years
g. New York – 171% profit growth in 7 years
h. Florida – 54% profit growth in 3 years

and:

...By increasing prizes in lottery games, greater sales can be achieved, and even though the profit percentage achieved may be smaller, the level of real, spendable dollars will increase. This has been demonstrated in various U.S. lotteries and is the primary point made in this document; eliminate the mandated profit percentage and realize increased real dollars for education.

State lotteries have paid for their share of economic studies over the years just like racing has. Instead of ignoring the recommendations of the studies (like racing has) those states whose lottery commissions have decided to ACT by implementing the takeout reductions recommended by the studies...

Those states have seen increased PROFITS from their games and MORE MONEY flowing to state coffers.

This isn't conjecture... It isn't "wouldn't it be nice if"... like some track operators (and some posters in this thread) keep insisting...

NO. This is very well documented very real case history in the real world.

Those state lotteries that have lowered takeout on their games with the objective of pricing their games closer to the optimal pricing point than the games had historically been priced... Those are the states whose general funds are reaping benefits. At the same time, lotteries in states that have chosen not to reduce their takeouts have underperformed.

Kind of hard to ignore, no?


-jp

.

[andymays]

Do Lotteries have the same overhead as does racing? I don't think so.

The cost of putting on the show is too great.

Not enough handle for too many tracks.

If you guys are correct and you may be then what is anyone doing to get rid of the people in charge one by one?

[Saratoga_Mike]

Originally Posted by Jeff P

From the Oklahoma State Lottery Site:
http://www.lottery.ok.gov/media/docu...2007-12-14.pdf

Excerpt:
and:


State lotteries have paid for their share of economic studies over the years just like racing has. Instead of ignoring the recommendations of the studies (like racing has) those states whose lottery commissions have decided to ACT by implementing the takeout reductions recommended by the studies...

Those states have seen increased PROFITS from their games and MORE MONEY flowing to state coffers.

This isn't conjecture... It isn't "wouldn't it be nice if"... like some track operators (and some posters in this thread) keep insisting...

NO. This is very well documented very real case history in the real world.

Those state lotteries that have lowered takeout on their games with the objective of pricing their games closer to the optimal pricing point than the games had historically been priced... Those are the states whose general funds are reaping benefits. At the same time, lotteries in states that have chosen not to reduce their takeouts have underperformed.

Kind of hard to ignore, no?


-jp

.

In essence, you're making a Laffer curve argument. With state lotteries, there's little question in my mind that most are taxed (takeout) at too high of a rate. It's just not clear to me exactly where optimal pricing is for horse racing. Is it 20%, 15%, 10%, 5%?

[tzipi]

Las Vegas in the 70's needed a surge so they lowered their takeout and they boomed big time. More players were getting more money back and were rebetting it. The more you give players back,the more they'll play. The more you take away,the more you will see them leave.

[Indulto]

Originally Posted by Horseplayersbet.com

The biggest problem I see is what constitutes a losing ticket? If you have a three horse exactor box and the ex pays $9.40, is that not a losing ticket? I don't get the IRS thing. If you bet $20 across on a horse who finishes third and pay 2.10 for third, you can't show the IRS the loss either.

I think the simple thing for tracks to do is give a rebate at source (win or lose). You bet $20, you get a voucher for a $1 with your ticket. If you refund your ticket before the race, the system picks up on it and only gives you $19, or if the horse is scratched, the system picks that up to.

I agree, but it's TOO simple -- no room for the "gotchas" like people losing tickets or not be bothered to recycle them. I'm sure the tracks would also impose some limit on the recycling window.

Good thinking, though.