Today we saw some news from New Jersey, where it appears (finally, unless something happens) exchange wagering will be offered to residents of that state, sometime in 2016.
Meanwhile, back at the ranch, Derby Wars (and others) were looked at in an excellent piece by T.D. Thornton in the TDN.
There's a lot of chatter about both betting systems; cannibalization, cheating, not giving anything back. Pick one, or a few of many. It is what it is.
The first rule, since we can remember (I think it started in North America with beaver pelt sales), is that when you lose a customer, you find out why. Did they not like your product, your hours, your store, your staff? From those answers you can likely improve your sales.
When it comes to horse racing, not nearly enough has been done in this vein, but from what people speak about, and using a little logic, we can make an educated guess. Lost customers were tired of losing, the product was not a good enough gambling product, pricing was too high, the delivery systems were lacking (four ADW's to bet all tracks due to protected signals), etc.
Derby Wars and Exchanges are two avenues that can help get them back. Derby Wars through offering a casual game on a Monday (interestingly enough I played the new harness game on Monday and bet a few races in the pools because of it; I never play Monday), can entice some to play. It's a completely different experience when compared to making a pick 4 ticket. Betfair offers lower juice and a new way to play the win pools. Losing too much on jackpot, single ticket, pick 30's at 57.5% juice? Ready to give up? Here's something for you to try instead.
Horse racing insiders often complain there is not enough marketing money being spent. That's probably true. As everyone knows, Draftkings and FanDuel have spent the GDP of a small country on marketing recently. That marketing is about the pro sport in question; it markets for the NHL, NFL, NBA and MLB, and does not cost those leagues a dime. That's why major league sports like the avenues so much, and even with the silly press recently, are reticent to cut the bait.
Places like Betfair and Derby Wars do that, as well. As Mark Midland alluded to in the T.D. Thornton piece, they are operating at break even and sinking money into marketing. Betfair spends oodles on marketing - they will likely operate at a loss in Jersey for some time - and that only can help Monmouth, for example.
What alphabets can you name that are currently operating at a loss for the sport?
Betfair, Derby Wars and others like them are speaking directly to lost customers in a way in which the tracks are not, and can't, and are using hard dollars to forward that discussion.
Betfair came to North American racing long ago - about 12 years or so - and was rebuffed at every turn. Derby Wars, as we saw at last month's CHRB meeting, drew the ire of old time racing. It's time to embrace some new avenues, because when it comes to lost customers, it is innovative and fresh delivery systems like these which can speak to the lost markets.
In business parlance the partnership with resellers acts like an accretive acquisition. That's a good thing and it's something that racing cannot do alone.
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