Wednesday, February 26, 2020

The Bet/No Bet Decisions Can Be Humdingers

If you ask anyone who gambles they'll share stories about a score, or a time in the recent or not-so-recent past.

Often this score or story will be of an angle, or barn change; a tactic on an exchange, or betting the chalk in certain situations at hockey or football.

The story usually ends with, "that doesn't work anymore".

If there's something we need to do in gambling, it's roll with the punches, because being too late on leaving an angle or power rating, or horse, or trip or replay or bias note, can pretty much kill a bankroll.

I thought about this again this past Monday, not wholly in the above context, just to illustrate a point (one which may or may not be valid).

At Woodbine, where the pick 5 is generally a decent bet, the late edition was relatively boring to my eyes. However, Ryan on the twitter - a venerable, very good Woodbine pick 5 player - tended to like the sequence. He was focused on two horses - trotters in race 7 and 9.

Both trotters were, to me as well, live winners. But the reason, in my view, was obvious. Both fired home well, replay watchers certainly would be on them and if you follow the races fairly religiously, they looked like slam dunk pick 5 plays.

But really, they weren't heavy chalk, and neither was a morning line favorite (one was 6 or 10-1 I think). Technically they should be decent pick 5 plays. And most certainly, twenty years ago, when the pools were fuller, and dead money more prevalent, they'd be top notch bets.

But my nagging brain on being different - having to have something bettors would not see in virtually any sequence - led me to stay off the bet.

My question to you (as similar every day gamblers) - We know we have to be different to make money, but do we take the wish to be different too far sometimes? Are we leaving money on the table, just to be different?

Sometimes I wonder. Because we're unconscious competent at certain meets that we play religiously, do we (wrongly) believe something is more obvious than it really is, and we're pitching horses, or deciding not to wager horses we should be?

Have a great day everyone.

Monday, February 24, 2020

The Decision Makers in Racing Ain't Much Help

Tonight at Woodbine/Mohawk a horse without a charted line since January 10th roared off the wings and won in a lifetime best, paying $124.10.

Some of you may ask how a horse off that much time without qualifying was allowed to race, and that's an honest question. They changed the Qualifying layoff time from 30 to 45 days awhile back. For harness horses, this is a big change, as we all know. These horses need to race week to week, so any stale dated line is a red flag.

The rules were changed - as they often are - not for bettors, but for participants. They have to ship to qualify, and shipping costs money. This same exact rule was changed in the US, as well, for this reason.

When I brought up the implications of this to some in the sport, I was dismissed. Something I am certainly used to.

But the reason I brought it up was precisely this:

The pick 5 - something Woodbine wants everyone to play - included this stale dated horse. It attracted $63,000 in money.

The pick 4 also included the horse, and that pool was $52,000.

The race itself had a handle of about $110,000.

All the pick 5's were four of five - something I've never seen before at this pool size. Everyone was blindsided.

That's real money, bet by real customers, who had no idea what said horse would do off 40 days off. How could they know, she didn't even have a charted line.

As bettors we're conditioned to this. We play and it's "part of the game". But what kind of game is it, when likely two or three people out of the hundreds of thousands of dollars bet know the horse is on go off the stale date?

I remember my first job in the mining industry. I was assistant to the Corporate Secretary who wrote the press releases. One day there was big news at the office - our drilling hit 50 feet or so of gold, at 0.5 ounces per ton. The stock was going to fly.

And..... the cone of silence went up. If we got caught even whispering to someone - hey I am sure I had a buddy who could make a quick couple of thousand - we'd be strung up by our ears by the authorities. It has to be that way, because the investing public needs to be protected, or there won't be an investing public.

In racing, with changing qualifier rules (and a hundred other things) not only do authorities not protect the bettor, they pass policies like this that make it worse.

This is nothing to be fixed; it's shouting in a vacuum. The horse was a longshot even with a line; it is what it is; life goes on. It's racing.

But for once, just once, I'd love to see the business ask, "how does this change influence the customer"? And when the bettor does share his or her opinion, they at least pause for a moment before doing the opposite they ask.

Have a great night everyone.

Wednesday, February 19, 2020

Cheerleading's a Symptom of Inherent Weakness

This past weekend, golf fans lamented the coverage of the L. A. Open at Riviera on CBS. Shots were not shown, many shown on tape, and some of the leaders were not even telecast while they were in contention. In addition, more ads were shown per hour. It felt, to many, different.

Today, Geoff Shackelford referenced a podcast with newly-fired (and the very-excellent, in my view) CBS on-course commentator Peter Kostis.

Some hot takes:
  • "It was the tour that told CBS to get younger, I think the Tour had an issue with me not being a cheerleader"
  • “The Tour wants more control over what’s being said. I think they want more cheerleaders on the telecasts. More people that are going to “promote the Tour’s product,” you know which, we’re bridging into the stuff that people are really upset about: the quality of the telecast. 
  • ”They are interested in the marketing of the product, not the quality of the product.”
  • The PGA Tour doesn't give a rat's ass about the quality of the telecast, they don't care about the quality of the viewer experience.
The PGA Tour gets much-money from TV, and is currently negotiating a new TV deal. As well, they get money from FedEx to push the end of year FedEx Cup, which many it appears, including myself, don't care much about. 

It again appears, according to this interview, the younger demos, perhaps gambling, and promoting companies during telecasts is what the PGA thinks is their future. 

What seems most apparent, is what they don't think is their future - the golf. 

Horse racing seems to have gone through this exact same thing. 

The sport is about promotion, and marketing, and hats and drinks and buses. It seems to be everything except gambling. And if you aren't cheerleading the first statement, you'll find yourself blocked on twitter or called a name that rhymes with rope. 

I wish the PGA tons of luck with this new strategy. From our experience in horse racing, I think they're gonna need it. 

Have a nice Wednesday everyone. 

Wednesday, February 12, 2020

@multiracewagers Checks Out & Assorted Takes

Good Wednesday everyone.

If you've been following some of the NHC chatter on twitter (opinion that primarily was about the value, or lack of, in playing the tournament, or satellites) you've probably noticed a little tension; tension that included a type of "misanthrope" moment from some in the industry this week.

One person who never minces words, especially when it comes to the treatment of players (and was near the center of it), is was Multiracewagers. He sent a note today that I share below:

"In June 2011, I started on Twitter and created Multiracewagers given my passion for all things horse racing. It was the greatest puzzle that was out there to be solved on a day to day basis. However, at this point I’ve realized that day has passed and is never coming back. Small fields, crooked trainers, jackpot bets, and the absurdly poor treatment of customers is the reason I want absolutely zero to do with the sport including this twitter handle. Sure, I may dabble in a BCBC, but in terms of knowing what is going on w/ the sport on a day to day basis, I couldn't care less.

 I am thankful for the people I have become friends with and the stories we shared, but it’s time to say enough is enough. The NHC and people defending a 65% takeout on online Q’s was the most egregious example of idiocy, that unfortunately, I have learned to expect in this industry. Yes, I have called out a lot of the bad actors in the industry. However, I have always tried to help players understand the game and improve the weaknesses in their game. At the end of the day, I hope you have enjoyed my unfiltered takes on the industry as it barrels headfirst into the abyss with unfounded arrogance.

Thankfully, I have found DFS to be more compelling and lucrative. I am fortunate to have found my lifeboat to get off the sinking ship. Good luck finding your lifeboat, the time you will need it is quickly approaching.

Garett Skiba/Multiracewagers"

I won't share a detailed opinion on tournaments because they are simply not my bailiwick, but I can't help but sense a pattern. It seems virtually everything the sport does somehow involves a degradation of end-user value.

Over the past several years:
  • Raise Takeout, Check
  • Short Fields, Check
  • Jackpot Bets, Check
  • Overtax Exchanges in Jersey, Check
  • Add Takeout to Existing U.S. Takeouts at Woodbine putting an entire country at a disadvantage, Check
  • Destroy Rebates for the Smaller Player, Check
  • Destroy Competition Through Signal Fee Policy, Check
  • And now, as it appears, Tax Tournies at a Usurious Rate, Check
Without malice or bias, let me ask you a question. 

If McKinsey was hired by the sport and asked "What can racing do to eliminate handle and customer growth?", would they not come back with this exact list?

I'm sure our sport wants to grow. The industry people calling Garett and others mistanthropes surely wants it to. But don't they realize they're doing this wrong?

Have a nice day everyone. 

Monday, February 10, 2020

Looking Down at Racing's Customers Is in the Sports' DNA

Rider Lane Luzzi made a pretty big splash on the twitter for a tweet (deleted and now apologized for) that was less than deferential to the gambling customer. We see and read these thoughts from time to time from people in racing's various cohorts or fiefdoms; it's nothing new.

What strikes many of us from time to time, though, is the pattern this represents. We'll often hear complaints about how no business treats its customers with such disrespect, or have them so low on the totem pole compared to others, like racing does. These people are not wrong.

Why is that?

A portion of one of Seth Godin's books talked about a business (or industry) and six audiences.
  • The sales force 
  • the stock market 
  • potential new customers 
  • existing customers 
  • employees
  • regulators
If you and I ran a candy store at the corner, we worry about customers. Period. Horse racing should really be like a candy store. Revenue comes primarily from handle (sales of candy). 

But it's not really that simple. From the piece:
  • Every organization chooses its own audience, and that choice is based on the architecture of the industry, the mindset of the boss and the history of how you got here. But don't doubt that it changes everything you do.
Racing's choice is not customers and never really has been. It's about regulators (TSG in California right now) and the stock market (CDI) and 'employees' (TOC and other groups). And yes, that lack of one focus "changes everything you do". If you don't focus on customers, how can you possibly have more of them? How can you possibly grow handle?

Many companies juggle different cohorts as a matter of course. One regulatory change can kill a car company, one strike can hurt revenues, and they sure do pay attention to a stock market. If you watched the Super Bowl and saw many millions of car ads, you wouldn't say they aren't customer focused.  

The next time you hear racing really doesn't need to pay attention to the gamblers, in my view, we should just shrug. It's a part of the sports' DNA. And falling relevance and revenue over the last two decades hasn't budged it one bit. 

Have a nice Monday everyone. 

Wednesday, February 5, 2020

Fixed Odds in Jersey?

It looks like fixed odds wagering for horse racing will make its debut in New Jersey, hopefully by the Monmouth meet. It appears this will be done via a deal with one specific company:

"The 10-year agreement will allow the Australian company, BetMakers, to offer fixed-odds bets on races at Monmouth in New Jersey and market fixed-odds betting on the Monmouth signal to other jurisdictions in the U.S. and worldwide."

I guess this should not be too much of a surprise as Monmouth had offered some props via the sportsbook last year, and shows less reluctance to try new things than some.

Looking forward, I surmise the lines for win wagers will be pretty high takeout - probably near board odds. In effect, I suspect they're using this to offer out the Monmouth signal (in a way) in a sportsbook, hopefully to entice bettors to give them a look. It feels like this won't be something for me, you, or serious bettors, but more of a marketing play.

Frankly, I half-expected to see something different in this vein from the Garden State.

With an already working exchange, and Fanduel/Betfair firmly cemented in the State with the infrastructure and marketing pipeline set up, I think a fixed odds system is most optimal using their technology, state wide. As many of you know, a fixed odds system with an exchange, where bets can be laid off, and priced out using the Betfair Starting Price can be pretty vibrant. The market, in my view, could do some serious volume, enticing both existing players, players overseas and new bettors to give them a look.

Reading between the lines, and the tea leaves, this feels more like a dip in the water salvo, rather than a long term play. We see this in the sport quite often - "we want to try it, but we have to protect what we have."

Interestingly enough, this is what many of us thought the strategy with sports betting would've been - high takeout lines, tied to doing something, but not priced to optimally grow revenue in a low margin high volume vertical. Sports betting went all in, and it's a reason why it'll do (nationwide) $15B or so this year.

Have a nice Wednesday everyone.

Tuesday, February 4, 2020

The Pennsylvania Slots Polka

The latest threat to horse racing is in the Keystone State where (first reported by Bill Finley), $200M from the horse racing fund is planned to be diverted to tuition subsidies.

“Let’s bet on our kids instead of bankrolling race horse owners and ensure the viability of the Pennsylvania State System of Higher Education,” said the Governor.

As most know, this is similar to the province of Ontario back in 2013, where much of the $400M plus slotted for horse racing was killed unceremoniously by the cash-strapped government. Although at the time, the money was not earmarked to go into anything else.

Like Ontario, one might expect this salvo to look much different when the ink is dry. Generally governments do not cut something off cold turkey, because it's bad optics and bad optics are antithesis to their DNA. Horse owners et al can certainly hope that's the case. But it does bring a ton of uncertainty as it works through. Hey, at least it's not sales season.

It's somewhat ironic that they're diverting money into tuition, which has increased by 468% since the 80's, well above the rate of inflation. Most economists agree that this inflation has been in large part due to subsidy and the free flow of student loans. So, it appears they've moved from propping up purses artificially to propping up tuition artificially, with neither $200M to the schools or $200M to horse racing fixing an underlying supply and demand, negative return on investment problem.

We've spoken on the little blog for some time (I know you're bored by now) about political risk for horse racing. Whether it be from breakdowns at Santa Anita or slot money in government budgets, the effects can be savage. It's not a drip, drip where losses are smooth and revenue changes are gradual; it's a tsunami.

Over the next several months we'll see how Pennsylvania racing tackles this prescient political problem. They're not the first to deal with it, and they likely won't be the last.

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