I see some folks chatting about Canterbury Park on the twitters lately, due to Bill's piece at the TDN. There's a good deal of talk that pricing changes "don't work", etc.
Most of the time, and this is no exception, much of this chatter, in my view, is worrisome. Worrisome because we miss the big picture, and don't recognize this is a symptom of a big racing problem.
Bill notes, "Canterbury officials reported that the takeout reduction cost them
$318,909, a significant amount of money for a small track. ."
"$318,909" might sound like significant dollars, but it really isn't. Canterbury, through card rooms, beverage sales etc, did $52.3 million dollars in revenue last year.
The amount "lost" through the takeout reduction is a misnomer; a takeout rate change didn't cause fewer races, decimated field size, and the rain; nor does it ensure 2016 revenues would equal 2015 with no change. But even using that language the percentage "lost" is 0.61% of total 2015 revenues. Yep, 0.61%.
Now, the goal of this takeout reduction, explicitly stated, was to increase off track wagering and give the signal a boost. That happened. In 2015, $28.6 million was bet by simo bettors on the CBY races. In 2016, that number jumped to $31.1 million.
What we saw was 0.61% of revenue spent for a multi-million dollar handle gain. Isn't that the point? Isn't that what people have asked from slot tracks for a long time; use alternative revenue to help grow the bet?
I have no idea what long-term takeout reductions mean for horse racing. I don't know what it means for Canterbury, or any other tracks that try, especially in a small data sample.
I do know is that a slot or poker track using 0.61% of revenues to grow handle is something that should be cheered, not jeered.
And I think we need to remember, the alternative sucks. Small tracks who haven't spent revenue to grow the bet are not 0.61% sure to be shuttered, but 100% guaranteed to be when the subsidy runs out.
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