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Showing posts from April, 2017

Racing Has Some Value

This morning:
Time Inc. looked around for a buyer and finding none, declared that the new owner would be "You"! — Jack Shafer (@jackshafer) April 28, 2017 How's that for a kick in the teeth. You have a historically important media brand, and no one wants to buy you.

Racing and Time Magazine should have a lot in common - they've been attacked by new outlets, they're old, etc - but they really don't.

Racing's environment is enhanced because of things like i) Pennsylvania looks at taxing online gaming so it never really has a chance and ii ) since being regulated, DFS, which is being taxed quite hard, is bad - I looked at the $300k MLB game today and the takeout is a massive 17.5%. This is about double what it was in the free market.

If the Huffington Post or Drudge were taxed at a high rate, or told they have to only run in 24 states, or told what advertising they could or could not run, or legislated that they had to be behind a paywall, while Time is le…

McCraken Press Conference - Live Blog

As you all know, the buzz horse for this year's Kentucky Derby is none other than McCraken. His works are "amazing", he cools out "like a good horse should", he looks "shiny like a seal", his baths are "Orb-like". As well, there are numerous rumours surrounding the horse, and his super-human ability. He has captured the imagination of everyone; even curmudgeonly turf writers like Marcus Hersh.

With that, after this morning's jog ("perfect") McCraken met the press for the very first time.  Here's a summary.

"I know y'all have wanted to talk to McCraken, so today McCraken speaks," said McCraken. "Go.... you right there." McCraken motioned his glistening hoof to the DRF's Marty McGee. 

"How are you feeling? You look good, you look strong, you look formidable. Are my eyes deceiving me? Or are you really this good?"

"No Marty, your eyes are the windows to McCraken's soul, and McCr…

Amazon's Business Strategy is Just a Tad Different

I caught this tweet today:

#amazonprime had 80 million members in the United States at the end of March 2017 - via @cirpllc
— Statista (@StatistaCharts) April 26, 2017 This is pretty incredible. 80 million. This is a store, not a social networking site like Snapface, as the great Bill Belichick likes to wax poetic about.

The Amazon business model is complex, yet simple.

Build products and deliverables that market themselves >  Once customers are captured, increase customer utility, which increases company ROI > Deliver more service through membership privileges, which lowers churn > Use technology and customer service to keep customers happy and buying for life

This is exactly, in my view, what racing's ADW model should have always been. Right down to the letter. But it's not. Not even close.

Think about what "ADW Prime" delivers to a customer. At Woodbine's ADW, they won't even pay you track odds on …

Entitlement versus Reality

I read a brief overview of a book on the 2016 Clinton campaign recently. One paragraph struck me.
 Stumped for months by how to explain why their candidate wanted to be president, Clinton staffers began toying with the idea of seeing how "Because it's her turn" might fly as a public rallying cry. Seriously.

The book, (from mainly anonymous sources, but is not really being disputed too much) goes on to talk about how data was not used properly, how Mr. Sanders campaign was simply a bump in the road and not any sort of movement they needed to react to, how signals were noise, and how slow the reaction time was to what was really going on.

It's easy to stick the knife in when someone, or some team, or some horse loses. We live in a social media world where blame has to be assigned, and we have to club that person or institution into submission 140 characters at a time. But I think that one line - "because it's her turn" - means quite a bit.

When a busine…

Racing Data v Other Data, Part One Hundred

I was delving into different forms of betting in sports recently, and came across another item.

Esports betting is growing like a bad weed, with some expecting handles north of $20B in a few years. With that growth, the demand for data is huge,  and it's in the very nascent stages. 
“Esports is quite unique,” says James Watson, head of esports at Betradar. “The data is available from the games themselves, of course. But it isn’t necessarily available in real-time.
“That’s why we have partnered with official data providers in the space,” Watson continued.” Without those partnerships, suppliers and the operators they service are relying on public data – public data that is delayed at source by the tournament organizers or game publishers.” The pressure to deliver this data, seamlessly and efficiently is key to the sports' betting success. So, it's all hands on deck, with various providers doing the necessary R and D and investment. Other than the obvious reasons, it'…

There's More to Racing's Market than Men & Women, the Old & the Young

I marvel sometimes how we get so stuck in a bog in racing.

Racing is about rich people and brands, where old men gamble and women watch them (while wearing a nice hat); where the young fellow at the end of the grandstand is boozing on 50 cent beer.

Targeting them involves that stereotype. It's the way it is.

Instead, others take a different path.

I had to do some research recently and learned that the video gaming top-line demo in the US is primarily male, and young. I guess that should be no secret.

So, a marketer (a terrible title for today's profession, but we'll use it) should, according to racing, act accordingly. This is an open and shut case, no need to call Matlock.

But it's not the way things work in today's world. That's why others use cohort analysis, subsets of subsets, and take advantage of the amazing tools data and the web affords.

When you do that, doors open.

Looking at the subsets for video gaming, you learn:
 Adult women have recently unseate…

No Confidence, No Will & No Passion

If you ask executives in racing what they think about the future, and the business of the sport itself, you usually get answers like:

We have a nice base with slot money, and table games might be coming in, so I'd say the future looks good.

We hope to have poker rooms approved soon.

Our Big Fish unit has been really good.

Sometimes we wonder what business the horse racing business is in.

I read an interview with the Woodbine CEO in the Toronto Sun recently:
“Single-game sports betting is a real game-changer and I follow it closely wearing both of my hats,”“Our trick from a horse racing standpoint is to make sure it doesn’t cannibalize what we’re doing. The influx of lotteries and internet gaming and offshore gaming hurts us significantly today. The sport of horse racing has been cannibalized by the lack of enforcement, shall we say, of offshore wagering and the influx of corner store gaming and pro-line gaming. None of that existed 20 years ago. Single-game sports betting, it goes …

Jeff Sessions is Racing's New Best Friend

If there's something we learn often - so much so it should not be surprising anymore - politicians really like freedom, except when they don't like freedom.

In this week's edition, there are rumblings in the US that the 2011 opinion that allowed states to run and regulate internet gambling is on the way out.

"Sessions indicated that as attorney general he would revisit and likely overturn a 2011 opinion by the agency that restored federal gambling law to Congress’s original intent and returned power to regulate intrastate gambling to the states."

With lobbying, cronyism, and other isms, this could mean that gambling online, as we know it, will be banned in some form.

While the ACLU and true conservative groups complain, racing - outside the large gaming companies, of course - should be happier than Exaggerator in slop.

Racing's big edge, for about as long as we remember, has been their monopoly power. Even as it eroded over time, it was given carve-outs wi…

It's Always Day One or It's Stasis

Awhile back, Jeff Bezos of Amazon released a shareholder and employee letter from 1997. In it, and much more recently, Bezos describes his company as a "Day One" firm. To him, a day one company is one which is just beginning in its journey, not in the middle, or at the end.

"Bezos compares "Day 1" companies — companies that are at the beginning of their potential — with "Day 2" companies. "Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1."

20 years later is still a day one company.

"It takes a long time to build sustainable long-term value. It takes a big long-term vision and obsessive focus on the few things that really matter (in Amazon's case, customer satisfaction). It takes a thick skin and the willingness to ignore the screaming and disgust of shareholders looking for a quick score (which, because of the intense c…

How the World (Outside of Racing) Sets Prices

It's kind of geeky, but I've had a lot of fun reading articles since Monday on how airlines set their prices. Of course, there's the overarching easy answer to that question in the capitalist system, devoid of regulation - the market sets them. But with inventories, capacity, hubs, spokes, backwards and forwards linkages and supply chains and myriad other things, the way the market sets prices is pretty interesting.

Techcrunch had a decent look at it yesterday. Here's what I learned:

Airlines operate on 1% margins. I suspected it was more than that.

They move 900 million passengers a year in the US.

To move massive amounts of people at 1% margins, they need to study reams of data, and formulate a plan that makes things work, at the lowest cost possible.

Up to 15% of the people traveling miss their flights.

Airlines overbook, primarily, because booking 180 people for a 200 person plane (allowing passengers who switch tickets or miss flights would be guaranteed a seat) w…

Empowering People

Harvard Business Review posted what I thought was a good business article some time ago. It focused on adaptability. In a nutshell, it believes that in the inter-connected world, companies that adapt quickly is the new competitive advantage.

Adaptation, according to the authors, is built on four pillars: Reading a signal, experimenting, managing the morass of intra-company and industry framework,  and mobilizing the new strategy that comes from it. Today, these four things have to happen very quickly.

One line caught my eye: "Perhaps most important, they have learned to unlock their greatest resources—the people who work for them."

Yesterday (and yes I realize this has been beaten to death) United booted that fellow off the aircraft and is in a heap of trouble. It probably could've been easily avoided.

Employees are empowered to implement policy, not think on their feet, or use game theory. In fact, in a lot of large companies, employees thinking on their feet is discour…

United versus Churchill, Who's Worse?

So, in one corner we have United Airlines. We all heard about that today - they overbooked a flight, offered the usual bonus on the booking (in this case, they went up to $800) to get someone to leave the plane, and when no one took them up on it, they had the cops forcibly remove a dude from his seat.

That's some bad mojo.

Overbooking, as a rule, is something often done, accepted, and not without reason. It's economically sound. But, as they say, the cover up is worse than the crime. Man, it's worth typing again, that's some bad mojo.

In another corner, we have the Churchill Downs pick 6. In this instance, one lucky ticket holder was poised for a chance at a $750,000 score on a 20-1 shot in the last leg of a jackpot pick 6. The last leg was cancelled after a brief delay due to the weather. Snooze you lose Mr. Customer. Don't measure the drapes!

This could be described as economically sound as well, because if a pick 6 carries over, the track makes mucho moola wit…

The Press is Treated in Polarizing Ways

The Masters begins tomorrow, but for those in the press pool it began earlier this week, because, for them, something changed. Augusta National invested millions in a state of the art, brand new press room and restaurant for the world wide reporters and commentators covering the event.

 Golfer Rory Mcllroy:
 These guys [the press] are not going to want to leave. You’re going to want to cover Harbour Town next week from there. Just get a feed and like stay there.’ It’s nuts. It’s unbelievable. It’s a bit of a museum as well, there’s so much cool memorabilia from the Masters and years gone by there, it’s, if I wasn’t playing in the thing I know where I would want to be hanging out that week.” The Masters is an older event, and they've always catered to the press. In fact, it is scheduled in early April because Augusta National wanted to accommodate the press; the press who were driving back to east coast cities from spring training. There's definitely been a relationship.