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Understanding

I stumbled upon a letter to the editor recently while looking for something else. It was in response to a TDN article, where the splits between ADW's, host tracks with other live venues, and OTBs were explained. The explanation was looked at from the demand (customer and handle growth, and determinants of handle growth) side, which tends to be rare in the horse racing industry press.

It looks self-serving to share it here, but alas, I think it shows something really important, so I do.

I often use the example that I don't know how to change a piece of equipment on a horse, I don't know when my colt needs Gastrogard, or Legend, I don't know what to do with a presumed bone chip, how to train the horse back, or what to do with a new feed on the market. That's what we, as owners, pay people for. We should never expect those people - those with a specific skillset - to understand Lifetime Value functions, churn variables, elasticities, return on ad spend, or seller-reseller dynamics.

The problem is, for horse racing, and betting on horse racing, that's who is in charge of understanding such things. They veto, or green light a Churchill Downs takeout hike, a California betting menu change, who gets and doesn't get a signal.

Jose's letter was something I found very interesting, and it made me smile. He, unlike some of the people who represent him and make decisions for him (in horsemen or owners groups) is saying "help me understand how we grow the bet, because I don't know."

Horse racing, and its growth or continued decline, will probably be based on policy change that is focused on demand factors. When those - owners, trainers; people a part of the IHA - have a better understanding of the issues, at least the sport has some sort of shot.

The next time you see a horseman say "I want to raise takeout to increase purses", or "we should charge 25% for a signal" remember, it's not their failing. It's the failings of a system.

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