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This _______ Will Be the End of Horse Racing!!

I was checking Drudge this morning and came across this headline : "Week of the Blood Moon". I didn't read the whole article, but as far as I can tell, it pretty much says everyone is doomed.

We're doomed in horse racing, too. Just look at the headlines.

The New York Times and the "24 a Week " story. We're doomed.

PETA. We're doomed.

Churchill raising rakes while they build a new giant TV. We're doomed. 

Lasix: Doomed.

Declining foal crops that result in lower field size. Doomerino. 

And of course, one of today's missives: If you want serious reform, you might not be doomed. But maybe you'd be boomed, because you might be the unibomber. 

This - fill in whatever you want - is the end of horse racing.

There's one problem; that's not the way it works. No one issue will sink or swim a business like horse racing. What grows it, or causes it to shrink will be simply done incrementally and its based on the industry's goals, and reactions to said goals.

In Good to Great, business writer Jim Collins speaks about the Hedgehog concept. Top companies who have succeeded - even in horribly tough industries - often have displayed this concept. It's about analyzing what you do well, having a passion for it, and growing incrementally with guiding goal (s). He says it's a battle between the hedgehog and the fox.
  •  “A hedgehog is like a strong consistent fire, whereas the fox is more like a flash fire. Short term the fox looks better, but long term the burning fire still burns with the passionate hedgehog.”
  •  The fox keeps coming up with new ideas to eat the hedgehog, but the hedgehog handily defeats him by doing his one trick: rolling into a thorny ball.
The fox runs horse racing, and he's the main reason it has slowly and surely lost market share.

Need a few dollars right now? The fox wants to raise takeout.

Raceday meds changes? Racedate shrinkage? The fox yells, "we might shrink field size next week at Mountaineer and we need 1,254 racedates to survive. Keep it like it is, we'll work it out."

PETA? "They're nuts", says the fox.

Spend money from slots on lower takeout and marketing? "I am barely scraping by so we can't take a small reduction in a purse," says the fox.

"Those darn ADW pirates! They need to pay more money", the fox tells us.

All of those incremental attacks on customer betting bankrolls, branding of racing, or square peg and round hole economics with foal crop and number of races, are problems that may not be felt in a month, a year or a cycle. But they are felt.

There's no hedgehog worrying about the incremental losses that each of them - among others - bring to the sport. Don't believe me? The main revenue driver for purses - which is the economic driver of the sport, is betting. Can you name five major policy decisions that have been enacted since 2000 to increase betting dollars from gamblers? How about three? Or even one?

There is no one thing that will be the "death of racing"; not Keeneland going to dirt, or lasix or takeout hikes or signal fee hikes, or PETA. But by letting the fox loose in the hen house instead of being guided by a passionate little unassuming hedgehog, each day, each month, each year things get a little slower. It could not happen any other way.


Comments

Steve said…
Interesting, I think the Racing industry in the US has been damaged, but a quick look at the numbers for just the Kentucky Derby show's it's not going to disappear anytime soon.

152,000 - number who attended the Kentucky Derby in 2013 in spite of weather issues.

$163 million - the amount of off-track wagering handled by Churchill Downs for the Kentucky Derby alone.

16.2 million - Television audience in the US using NBC. Does not include the 25 other countries it was shown in, online streaming, or other forms of viewership.

4.5 million - The number of unique visits the official Kentucky Derby website received in 2013.

6,000 - The number of registered Kentucky Derby parties world-wide.

4 Billion - The amount of money the Thoroughbred industry produces just in the state of Kentucky.

$220 million - The estimated economic worth of the Kentucky Derby weekend, which doesn't take into account the massive three week Kentucky Derby festival, which sees over 1.5 million people annually.

And there's much more where those come from..

Best regards, S. Moir