Where Is the Profit in Rebates?

[peter e]

A person getting a rebate, say 10%, bets $1,000.
Of that bet the track takes out about $160. The bettor gets $100 back, leaving the track with only $60 to cover its expenses and profit. Where does it profit from giving the rebate?
I must be missing something. Someone please explain.

[BillW]

Originally Posted by peter e

A person getting a rebate, say 10%, bets $1,000.
Of that bet the track takes out about $160. The bettor gets $100 back, leaving the track with only $60 to cover its expenses and profit. Where does it profit from giving the rebate?
I must be missing something. Someone please explain.

Tracks don't give rebates, only ADW's do. Tracks benefit without spending a penny when the person receiving the rebate bets more money, because he/she has more money to bet.

[InsideThePylons-MW]

Originally Posted by BillW

Tracks don't give rebates, only ADW's do.

How could anybody that reads this board say this?

[BillW]

Originally Posted by InsideThePylons-MW

How could anybody that reads this board say this?

I misspoke. No track that publicly advertises rebates or will talk to me (the average bettor) offers rebates that I am aware of. How's that?

[Imriledup]

Originally Posted by peter e

A person getting a rebate, say 10%, bets $1,000.
Of that bet the track takes out about $160. The bettor gets $100 back, leaving the track with only $60 to cover its expenses and profit. Where does it profit from giving the rebate?
I must be missing something. Someone please explain.

Tracks Can't (or don't) give rebates because every dollar they collect from takeout rates is divvied up between government, purses, etc.

ADWs can give rebates because they have very little overhead. Some tracks do give rebates, but they are disguised as player rewards programs where you can accumulate 'points' and cash them in for vouchers. Those rewards are very small. Some tracks give up to 4% to big bettors, that's the highest 'reward' that i know of.

[FenceBored]

Originally Posted by Imriledup

Tracks Can't (or don't) give rebates because every dollar they collect from takeout rates is divvied up between government, purses, etc.

ADWs can give rebates because they have very little overhead. Some tracks do give rebates, but they are disguised as player rewards programs where you can accumulate 'points' and cash them in for vouchers. Those rewards are very small. Some tracks give up to 4% to big bettors, that's the highest 'reward' that i know of.

Looking at my current player reward total, just $1000 more in wagers and I'll have enough points for that Bob Baffert dashboard bobblehead I've always dreamed of.

[Imriledup]

Originally Posted by FenceBored

Looking at my current player reward total, just $1000 more in wagers and I'll have enough points for that Bob Baffert dashboard bobblehead I've always dreamed of.

[andymays]

I would like to see a experiment or trial run where TVG and HRTV along with HANA and two Racetracks like Saratoga and Del Mar went to a 10% take for all wagers on a Saturday this year or next. It needs to be heavily promoted for 30 days prior but I think it would bring back all the offshore players and I think the pools would be enormous for that day.

We would all know where the different theories stand after that!

If there was ever a time to give this a shot it's now!

[Imriledup]

Originally Posted by andymays

I would like to see a experiment or trial run where TVG and HRTV along with HANA and two Racetracks like Saratoga and Del Mar went to a 10% take for all wagers on a Saturday this year or next. It needs to be heavily promoted for 30 days prior but I think it would bring back all the offshore players and I think the pools would be enormous for that day.

We would all know where the different theories stand after that!

If there was ever a time to give this a shot it's now!

The pools would be much bigger, but i'm not sure that would convince anyone to adopt a 10% across the board take.

[andymays]

Originally Posted by Imriledup

The pools would be much bigger, but i'm not sure that would convince anyone to adopt a 10% across the board take.

If it worked and the networks profited from increases in viewership (advertising) and handle (ADW) then you never know. It's worth a shot!

[Dave Schwartz]

The first thing that would happen is that the whales would become extinct - as a sizeable cut in takeout would hurt them. This would mean an instant 15% or more reduction in handle.

So, I doubt that total handle to the tracks would go up.

[Dave Schwartz]

An afterthought - the PROFIT to the tracks might increase but not the handle.

[Imriledup]

Originally Posted by Dave Schwartz

The first thing that would happen is that the whales would become extinct - as a sizeable cut in takeout would hurt them. This would mean an instant 15% or more reduction in handle.

So, I doubt that total handle to the tracks would go up.

Exactly. Good points, with much lower takeouts, whales stay away as there's really no incentive for them to play into a pool where their rebate is close to 0%.

[Dave Schwartz]

Yes, that would be good for us, but the point is that the tracks would not allow it.

[Jens]

Dave-
I'm completely baffled by your statement that a sizable cut in takeout would hurt the whales and cause them to become extinct??? It seems to me that as long as the whales takeout remains the same (or lower) that a reduced takeout would have the effect of doing just the opposite. Lower takeout for fish like me would allow us regular players bankrolls to last longer adding to the churn (handle), some solid players might even become profitable enough to approach or reach whale levels, new blood would be more likely to enter the game etc. All of this would mean larger pools which would allow the present whales to wager more without affecting their odds. What am I missing?? As long as the vig the whale pays remains the same (or lower) how could reducing the take to the minnows cause the whales to become extinct?