if you always wanted to go to the races in California...

[Poindexter]

Originally Posted by racenomics

For what reason does it not make sense to try to bring the big players to the track? As you know, tracks get a much larger percentage of handle on track compared to off track, not to mention that you are going to play the local track if you go. Even if the new fan goes to the local track and loves the game, if they just use an ADW they won’t bet that track nearly as much

There is a reason Amazon has taken over retail. People have made it clear that they want to do everything on their phones/computer. I get that you are trying to drive on track business, and there are some promotions that can be used to drive it. If somebody gets a 2% reward from an adw, they might be very interested with a promotion of free admission/parking and a 4% rebate for the days races. Having the person bet live with a 4% rebate is typically better than him betting with an ADW, I believe. Not really sure when the ownership of adws and ownerships of the racetrack are sometimes the same TSG/xpressbet, Nyra/Belmont, Twinspires/Churchill. I heard one guy on the bet with the best podcast say he is rebated with an ADW, when he goes to the race track he offers to bet live if they match his rebate, but they always decline his offer. Thus on track betting doesn't seem to be a major priority with at least some tracks. Maybe TLG can chime in on what is done to encourage on track betting.

From a personal standpoint, I haven't been to a racetrack since the year Real Quiet won the derby I believe (like 25 years ago). Don't miss it, don't need it. I can bet any track I want from home. That works for me.

I will say that with the cost of sporting events going up so much, racing is becoming an option in that regard.

[dilanesp]

Originally Posted by classhandicapper

The evidence that there are people like that is in the existence of CAWs. They are sharp people that made significant investments of time and money to get an edge. If it was a more worthwhile gambling endeavor, even more of them would participate and be successful. It's not like every CAW team is a success.

Still, imo poker is way more attractive than almost anything else.

1. Poker may require a LOT of initial study, but once you have the required knowledge the workload drops. Then you are mostly just playing cards. It evolves slowly. Horse racing is an ever evolving game that requires watching replays every day, staying on top of biases, trainer issues etc.. The work load is significant and constant.

2. In poker, you get to choose your level of competition. If you are losing at a high level, you can drop down to lower limits trying to find a level where you can win. In racing, you are competing with CAWs whether you are a beginner or 50 year player like me. There are few options for looking for softer competition.

These are both very salient points about poker. Indeed, (2) is really underrated in terms of advantage players. There's really no other game where you can specifically choose to play against very weak competition for lower stakes and avoid competitors who will prevent you from beating the game. And players who understand this are naturally going to gravitate to poker.

[racenomics]

Originally Posted by Poindexter

There is a reason Amazon has taken over retail. People have made it clear that they want to do everything on their phones/computer. I get that you are trying to drive on track business, and there are some promotions that can be used to drive it. If somebody gets a 2% reward from an adw, they might be very interested with a promotion of free admission/parking and a 4% rebate for the days races. Having the person bet live with a 4% rebate is typically better than him betting with an ADW, I believe. Not really sure when the ownership of adws and ownerships of the racetrack are sometimes the same TSG/xpressbet, Nyra/Belmont, Twinspires/Churchill. I heard one guy on the bet with the best podcast say he is rebated with an ADW, when he goes to the race track he offers to bet live if they match his rebate, but they always decline his offer. Thus on track betting doesn't seem to be a major priority with at least some tracks. Maybe TLG can chime in on what is done to encourage on track betting.

From a personal standpoint, I haven't been to a racetrack since the year Real Quiet won the derby I believe (like 25 years ago). Don't miss it, don't need it. I can bet any track I want from home. That works for me.

I will say that with the cost of sporting events going up so much, racing is becoming an option in that regard.

I’m not even talking about rebates. Yes they are nice, but if you give the big gambler a great time at your track, he is much more likely to come more often and bet your track than he normally would. And you will get a bigger piece of his handle. I personally believe that ADWs are killing the game and the tracks can’t take the blinders off.

[dilanesp]

Originally Posted by Poindexter

Lowering takeout is not a magic wand. It has to be done across the board, not just in this pool or that pool, it has to be done long term to bring people back in the game or into it for the first time and build their patronage, it has to be dropped to a level that is competitive with other forms of advantage gambling (something like 10% across the board) and it has to be done as part of a very comprehensive marketing/educating the new consumer package.

I have talked about this before, but I think this is incorrect. The actual answer is there's a revenue-maximizing takeout level for every race, but it's DIFFERENT for every race.

By the way, this isn't only true of horse racing. One of the reasons there are so many crazy proposition bets on the Super Bowl is they allow the bookies to increase the vigorish (takeout)-- they let you bet on the coin toss at 6 to 5 instead of 11 to 10!

If you have a 6 horse field on a frozen track at Aqueduct on a winter weekday, that's a far less attractive betting race than a 14 horse Breeders' Cup Mile at Santa Anita.

But horse racing has only ever internalized this to a very small degree. (E.g., the "Players Pick Five" in California is a minor example of it-- they charge only 14% takeout on the EARLY pick five; many bettors don't get to the track/log on on time, and most tracks schedule their full fields later in the card so the Pick 6 and vertical exotics do good handle, so handle increases throughout the card; a horizontal bet on the first 5 races therefore is a lower handle bet.)

Really, what you'd want to do with takeout (if regulatory issues didn't prevent it) is vary it quite a bit based on the attractiveness of the race. Short fields on weekdays and especially on off tracks might not carry much takeout at all-- imagine a 5 horse field with 2% takeout or something! On the other hand, the Kentucky Derby and Breeders' Cup should probably have much higher takeouts than they do-- people really want to bet them because they have big fields and because of the ego/bragging rights of a gambling score in a big race. (When the Breeders' Cup was at Lone Star, I believe the takeouts were quite high compared to other tracks. People still bet.)

The point is most businesses price their product based on demand. Horse racing doesn't, and honestly, this punishes its best customers who bet every day. (I.e., big takeouts on big stakes races also are kind of analogous to hotel taxes, paid by the tourists and used to keep taxes of residents lower.)

[castaway01]

Originally Posted by racenomics

I’m not even talking about rebates. Yes they are nice, but if you give the big gambler a great time at your track, he is much more likely to come more often and bet your track than he normally would. And you will get a bigger piece of his handle. I personally believe that ADWs are killing the game and the tracks can’t take the blinders off.

Dude, it's not 1950. ADWs ARE the game. Right now 90% of the handle is through ADWs, and 1/3 of that is from whales who are only playing because they get massive rebates from the ADWs. So you get rid of them how exactly? What motivation would any big player have to wager through the racetrack? You might as well say, well, if we ban Amazon my local store will do well again. You can't put the genie back in the bottle.

[Poindexter]

Originally Posted by dilanesp

I have talked about this before, but I think this is incorrect. The actual answer is there's a revenue-maximizing takeout level for every race, but it's DIFFERENT for every race.

By the way, this isn't only true of horse racing. One of the reasons there are so many crazy proposition bets on the Super Bowl is they allow the bookies to increase the vigorish (takeout)-- they let you bet on the coin toss at 6 to 5 instead of 11 to 10!

If you have a 6 horse field on a frozen track at Aqueduct on a winter weekday, that's a far less attractive betting race than a 14 horse Breeders' Cup Mile at Santa Anita.

But horse racing has only ever internalized this to a very small degree. (E.g., the "Players Pick Five" in California is a minor example of it-- they charge only 14% takeout on the EARLY pick five; many bettors don't get to the track/log on on time, and most tracks schedule their full fields later in the card so the Pick 6 and vertical exotics do good handle, so handle increases throughout the card; a horizontal bet on the first 5 races therefore is a lower handle bet.)

Really, what you'd want to do with takeout (if regulatory issues didn't prevent it) is vary it quite a bit based on the attractiveness of the race. Short fields on weekdays and especially on off tracks might not carry much takeout at all-- imagine a 5 horse field with 2% takeout or something! On the other hand, the Kentucky Derby and Breeders' Cup should probably have much higher takeouts than they do-- people really want to bet them because they have big fields and because of the ego/bragging rights of a gambling score in a big race. (When the Breeders' Cup was at Lone Star, I believe the takeouts were quite high compared to other tracks. People still bet.)

The point is most businesses price their product based on demand. Horse racing doesn't, and honestly, this punishes its best customers who bet every day. (I.e., big takeouts on big stakes races also are kind of analogous to hotel taxes, paid by the tourists and used to keep taxes of residents lower.)

I mentioned years ago that the takeout should be 1 percent per horse. So 6 horse field is a 6% percent takeout. 8 horse field, 8% takeout etc. If you have a double with a 6 horse field and a 8 horse they would charge 7% in the double pool. That would be ideal, but given having them drop the takeout to 10 % would take a miracle, going any further than that seems overly ambitious. 10% takeout even with a 5% rebate to the caw would keep most players at the right takeout level and would enable the sport to grow and promote itself and cross market. They can go to 12% on exotics if they want
especially the super exotics. See, I am compromising. Just give the everyday player something.

re:

The point is most businesses price their product based on demand. Horse racing doesn't, and honestly, this punishes its best customers who bet every day. (I.e., big takeouts on big stakes races also are kind of analogous to hotel taxes, paid by the tourists and used to keep taxes of residents lower.)

There are other ways to promote slow days than having to lower the takeout on certain days (eg free $20 voucher with paid admission, I have mention in the past 10 % bonuses on 3 horse parlays, etc......) There are other ways to generate revenues on big days (eg the ridiculous amount Santa Anita charged for parking). Racing would argue that they they reward their best (only?) customers, the caw with preferential pricing, who in turn provides huge liquidity into the pools to make the betting product better for us the suckers. Obviously I am not on board.

But ultimately just because they can add 5% to the takeout on Breeders cup day and get away with it doesn't mean they should. Those big days are the opportunity to gain customers for the rest of the year. Gouging them on price, because you can, will have a net negative effect. Not every business runs the same. You can't run a race track like a resort casino. You have to know your business and fully comprehend the ramifications of every decision you make. Racing is the ugly duckling in the gambling world. They have to be extra diligent to change that image.

[racenomics]

Originally Posted by castaway01

What motivation would any big player have to wager through the racetrack?

The same reason that they bet horse racing despite it having 3x the takeout as sports betting. Because they love betting horse racing

[dilanesp]

Originally Posted by Poindexter

But ultimately just because they can add 5% to the takeout on Breeders cup day and get away with it doesn't mean they should. Those big days are the opportunity to gain customers for the rest of the year. Gouging them on price, because you can, will have a net negative effect.

I don't buy that. The average tourist doesn't care about takeout. See also Las Vegas making Blackjack pay 6 to 5 at the Strip casinos. That's exactly who you want to gouge.

[thaskalos]

Originally Posted by racenomics

The same reason that they bet horse racing despite it having 3x the takeout as sports betting. Because they love betting horse racing

I think you are missing the point. The "big bettors" wager large sums of money because they bet several tracks a day on a regular basis. And you want to bring those big bettors to the racetrack so they can concentrate the bulk of their action on the local product? Don't you see that these players won't be "big bettors" then?

Even if those big bettors did go to the actual racetrack, they wouldn't be there to enjoy the ambiance of the place and bet on the local product. They would gather at the simulcast center of the place, where they could bet on the other tracks available that day. And why go to the track for that...when you can accomplish the same thing from the comfort of your own home?

[thaskalos]

Originally Posted by dilanesp

I don't buy that. The average tourist doesn't care about takeout. See also Las Vegas making Blackjack pay 6 to 5 at the Strip casinos. That's exactly who you want to gouge.

Oddly enough...the "average tourist" who plays 6 to 5 blackjack somehow avoids the racebook like the plague.

[Poindexter]

Originally Posted by thaskalos

Oddly enough...the "average tourist" who plays 6 to 5 blackjack somehow avoids the racebook like the plague.

Well they don't completely avoid it. When there is a big game on that people want to watch at the sports book those race book seats are very useful.

[racenomics]

Originally Posted by thaskalos

I think you are missing the point. The "big bettors" wager large sums of money because they bet several tracks a day on a regular basis. And you want to bring those big bettors to the racetrack so they can concentrate the bulk of their action on the local product? Don't you see that these players won't be "big bettors" then?

Even if those big bettors did go to the actual racetrack, they wouldn't be there to enjoy the ambiance of the place and bet on the local product. They would gather at the simulcast center of the place, where they could bet on the other tracks available that day. And why go to the track for that...when you can accomplish the same thing from the comfort of your own home?

They would be in the race book, but the tracks, both receiving and sending the simulcast would get a higher amount of the handle than otherwise. And that would draw many more people to the racetrack too. I still believe they would focus more on the local product than if they used an ADW to bet, even if more of their attention was going elsewhere

[thaskalos]

Originally Posted by racenomics

They would be in the race book, but the tracks, both receiving and sending the simulcast would get a higher amount of the handle than otherwise. And that would draw many more people to the racetrack too. I still believe they would focus more on the local product than if they used an ADW to bet, even if more of their attention was going elsewhere

If they would be in the racebook, and the racebook is also accessible from their house...why would they bother driving to the track?

[racenomics]

Originally Posted by thaskalos

If they would be in the racebook, and the racebook is also accessible from their house...why would they bother driving to the track?

Because they are treated great by the track so would prefer to be there than sitting at their house

[thaskalos]

Originally Posted by racenomics

Because they are treated great by the track so would prefer to be there than sitting at their house

I had a feeling you were putting us on...