Horse Racing's Grumblin', Bumblin', Stumblin'

Average handle fell at the last Meadowlands meet. Handle was $1.07 million per card, down from last year's $1.24 million.

As MH's article notes, they jockeyed around racedates, and field size was off by a horse, and both were detrimental. But, more broadly, this continues the mid-Atlantic carnage we've seen of late (outside Laurel Park).

Now, the meet was not ugly, per se, and in 2014 the Big M thoroughbred meet did $1.03M per card, and in 2013, only $988,000 per card. So, last year's meet did stick out, and this meet was up from those two most recent years.  But because this coincided with a takeout change, there's some rumblin' and grumblin'.
  • While racetrack executives rarely speak out in support of raising or maintaining takeout levels due to fears of public backlash, many privately grumble that supporters of takeout cuts consistently overstate the positive impacts while ignoring the negative effects on a racetrack’s revenue streams.
Oh please.

The Meadowlands meet, way back in 2004 did about $2.5 million per card. In other years, around $2M per card with only $180k or so for purses. In 2016 dollars, this is pushing $3 million per card.

In other words, the business has been circling the drain for a long time. In real terms, handle at the M is down 70%, gross, the last 14 years.

If there's anyone ignoring "the negative effects on a racetrack’s revenue streams" the line is long, and it certainly formed long before anyone was talking about the juice.

Working racetrack pricing is not magic ball that spits out free money. If it was, I'd start PTP Downs, charge 1% takeout and make more dough than Mark Zuckerberg.

It took dozens and dozens of years to destroy customers' betting bankrolls with high juice and lower and lower churn rates. Finding the right price where revenue can increase maybe will never happen, but it sure as hell won't happen overnight. And trying something is a lot better than standing around watching the customer base continue to circle the drain, while waiting for someone to buy the track and turn it into a shopping mall.


Anonymous said...

Is there a thoroughbred or harness track anywhere that's increased handle without dropping the take out rate? It seems to me to be the only factor that spurs more betting.

Ron said...

A Monmouth spokesperson displayed disappointed and made some interesting comments. It sounded like he expected immediate gains from the lower takeout. Of course I'm probably interpretating his statement incorrectly.


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