Friday, November 26, 2010

Calder and Tampa: The Tale of Two Cities

Calder Race Course has cut purses again, this time blaming it on a weak betting market. The Calder signal used to be a pretty popular one with players. Although Churchill does not issue handle numbers (I know, that makes little sense to players, but does when you are a public company I guess), it appears daily handles are about $1.75 million now. Not long ago, over $3 million was the norm. The Bloodhorse article states that almost $1B was bet at the track in 2007, and last year that total was $673M.

What the article fails to tell you though (which I am sure you all remember) Calder raised takeout in 2008, and not by a tiny amount. They upped pick 3,4,5 wagers 3% to an obscene 27% and increased DD's and Ex's by 1%. This along with a signal fight there, made a lot of players upset. This anger did not last a week or a month, people were talking about it a year later on chat boards, with comments like "I used to play there every day, but it has been off my radar now for a long time."

In addition, sure a few players can cut a track who raises takeout cold-turkey, but the true detriment of a takeout hike is not felt for years. If you get $225 back for a pick 4 instead of $250, it takes time to know you are more broke that usual. It takes time for a tracks bottom line to reflect that the dude who hit it rebets $225 instead of $250.

A case study, which is a polar opposite of Calder, is Tampa Bay Downs. In 2001 they had about the worst takeouts anyone in racing could imagine (they would have ranked in the low 60's in this list in terms of takeout score). Handle was about $1.8M or so a day then. Each year since that time, management there (quietly and without much fanfare) lowered takeout. In 2010 Tampa Bay set a per day handle record of over $4.1 million dollars.

If someone looked at the handle at Tampa in 2002 or 2003 there would not have been enough of a bump in handle to pay for the takeout decrease. People might have said "we should make it higher again" or "lowering takeout does not work; I told you so". Thank goodness they didn't, because they probably would never have doubled their handle.

Takeout, gambling games, and their customers are not an on/off switch. It is a part of a business strategy which has to have a long term vision and plan, based on sound economics. Places like Tampa who treat it like that type of business win, and places like Calder get their asses kicked.

Google Maps tells us that the two tracks' are 207 miles apart. But in terms of management vision they might as well be on opposite sides of the Universe.

Notes:

Gone
Tell All goes to Ontario. Stallions have been leaving Jersey, and he is the latest.

Zenyatta.... but
It is no secret some public figures and handicappers never gave Z much respect. Some of them after the BC quieted down. However, does anyone ever notice that some of the folks can not let it go? Almost every sentence with the mare is "Zenyatta is good....but". In the latest I see some folks are talking about how she would never have beaten Blame if they went around ten times. In response, there are videos and still shots going around chat boards showing her (appearing) to collar Blame after the wire. She is quite the horse; even in retirement people are still arguing about her.

Have/Have Not
Like Jersey, Kentucky is facing a "no slots" problem.

Knight Sky
Meet a pro capper

2 comments:

dana said...

Great post, as always. I don't follow these issues as closely as you do but I did notice that Portland Meadows had a successful meet last year and this year is advertising their low take out.

I don't know if their takeout is lower this year or if, in general, low take out is part of the reason for their success, but it might be worth looking in to.

Tinky said...

The Calder/Tampa comparison is apt, and well summarized.

Wit regards to those screen captures which purport to show Zenyatta finishing in front of Blame after the wire, anyone who has ever attempted to judge multiple photo finishes when the camera was not exactly at the finish line could tell you that they are misleading.

In fact, the parallax distortion is such that, when read properly, those captures don't even suggest that she had her head in front.