Follow the Leader

In our last survey this question was asked and here were your responses:

92% of you think this is just the beginning. It's why, at 9 in 10, you've wished to withhold some or all money at CDI properties.

What's funny is that we often hear from some 'CD's takeout is still lower than track X so why aren't you upset with track X?

Because of the above. It's follow the leader.

This was exemplified this weekend at Churchill Downs.

@turfnsport @ChurchillDowns a teller at CD brought up CA takeout today in convo. Didn't want to discuss CD takeout. Knew better.
— Tom Quinones (@TRCTomQ) May 4, 2014

Yes, a CD employee wanted to compare CD's 22% exotic take to California's 23.68% exotic take. "See, you are getting a good deal. Those guys are higher"

But as you all know well, California's takeout rate was raised to 23.68% from 20.68% in 2011.

They are comparing their raised takeout rate to another track's raised takeout rate.

In 1908, pari mutuel betting had a takeout of 5%. Now it's around 21%. That's exactly how you get there.

 That's why this is important, and that's why 92% of you understand the game of follow the leader.

This past week at Churchill Downs, despite perfect weather, a debuting big board and the usual fantastic Derby card, you bet less. Well over $5M less since the press release on Tuesday. On our email some of you said you were not going to bet the Derby or the Oaks (both were down from a wet 2013, and a shorter field Oaks in 2013). These events might've surprised some, but it didn't surprise us.

Now is the time where the takeout hike is most felt: With you the every day horseplayer. If that $5m reduction so far goes lower, you are speaking. You're telling tracks that they can't follow the leader anymore. You're telling Gulstream that they can't raise their takeout to "just under Churchill" on their pick 5. You're telling NYRA that because they have a super low exacta take, they can't raise it to "just under Churchill's". It's something you all believe needs to be done, and we stand with you.

One of the Best Bets in North America Debuts Today

At 8:30PM ET in race one today at Northlands Park the 10% takeout pick 5 debuts. I don't need to do the math on horizontals to tell anyone that's a fabulous deal, and it makes it much easier to win.

They even have free programs. Go figure.

To visit Northlands Website it's here.

HANA Poll Result: The Tracks You Said Respected You Most (and Least)

This past weekend we commissioned a poll of members about the Churchill Downs takeout hike, and your support or non-support for a withholding of monies from Churchill Downs Inc. properties. The results of that vote and press release is here.

In addition to that question we asked several ones in the survey and one of them asked you to rank racetracks in terms of customer friendliness.

The question:

The results by ranking, all respondents:

Because most HANA members lie in the average volume of betting range between $2,000 per annum and $100,000 per annum, we thought we'd look at the fringes in the survey. Those who bet $100,000 or more a year, versus those who bet under $2,000 or described themselves as "fans" who don't bet anything at the track per year.

This is overall first place votes from all respondents, subset to the two above categories.

There is really not that much difference between the two bet ranges. For some reason, the large players who took the survey (a relatively small subset, just like in real life at the racetrack) begrudged Belmont for undisclosed reasons. In the overall ranking they were much more middle of the road. Both large and small players, as well as overall bettors, ranked Keeneland number one, which is probably not surprising, since it's believed that they cater to the fan and bettor as well as any track in North America ever has.

Also unsurprising due to the headlines the past week and the poll commisisoning, Churchill ranked first in last place votes with over 60%. No other track scored last with more than 5% of the vote.

We'll have more from this survey next week.

Press Release: 9 of 10 Horseplayers Association of North America Members Polled Show Support for a Boycott of Churchill Downs Inc. Tracks & Assorted Properties; Action Commences

(Charlottesville, VA, April 29, 2014): A poll of Horseplayer Association of North America (HANA) members revealed that 90.2% of respondents will be withholding either some or all of their dollars from Churchill Downs Inc. racetracks – Churchill Downs, Arlington, Fair Grounds and Calder Race Course - wagering platform Twinspires.com and past performance provider Brisnet.com. 

This poll result is in response to Churchill Downs Inc. increasing their takeout rates by over 9% on the win, place a show pools and almost 16% on exotic pools at their Louisville, KY racetrack.  The takeout increase was put in place April 26^th and will continue for the rest of the meet.  

The poll also showed that only 8.5% of respondents believe that this is only a one-track phenomenon. 42.8% believe Churchill Downs Inc. will raise prices at their other tracks, and an additional 48.7% believe that other non-Churchill Downs Inc. tracks will follow with rate hikes. 

“The Board of Directors was struck by the anger this past week on social media and our email from rank and file horseplayers, so we commissioned a survey of members.” said HANA President Jeff Platt. “The survey confirmed that current HANA membership had a similar discontent and they’ve urged us to move forward.”

Although HANA will be working on partnerships with various groups, an advertising program, and a social media push to increase support for a boycott of all Churchill Downs Inc. properties, the Association of over 2,500 horseplayers believes the success or failure of the effort will lie with customers. 

“Large gaming corporations like Churchill Downs Inc. are extremely well funded, but we do not underestimate the power of an educated customer. We ask customers to share this action with their friends and fellow horseplayers,” said Platt. 

A list of Advance Deposit Wagering companies and figure/past performance makers is being compiled, so customers who wish to switch from Churchill Downs Inc. properties can complete their due diligence. HANA, as is its custom, will not be endorsing or recommending any of these products or services.  

The Horseplayers Association of North America will keep both members and non-members informed on its blog, twitter feed, Facebook page and via email as warranted.  Customers are also encouraged to visit www.playersboycott.org for more information. 

Further results from the member poll and the above mentioned list will be released next week on the Horseplayers Association blog.

____________________________________________________________

“What support are you willing to show a boycott, as a HANA member”:

I will stop all play and purchases at Churchill Downs Inc. tracks and properties – 39.94%

I will stop some play and purchases at Churchill Downs Inc. tracks and properties – 50.31%

I will continue to play all Churchill Downs Inc. racetracks and properties like I always have – 9.75%

The Horseplayers Association of North America is a grassroots group of horseplayers who are not affiliated with any industry organization. HANA hopes, through proactive change on several key issues (including but not limited to), open signal access, lower effective takeouts, affordable data and customer appreciation, the industry’s handle losses can be reversed. HANA is made up of over 2,500 horseplayer from all across North America, with an approximate handle of $100 millon per annum.

Twitter: hplayersassnna Blog: http://blog.horseplayersassociation.org/

Web: horseplayersassociation.org Further Information: info @ hanaweb.org

A Player Speaks

We found this post on Paceadvantage.com quite eye-opening.

"Greetings everybody,

Even though Twin Spires has some of the worst player rewards in the industry, I have been a loyal customer since they bought out YouBet in late 2010. I always loved their software, programming, hand histories, and lightning fast cashier. However, all of that came to a screeching halt when I read about their cynical scheme to bilk their already overburdened customers.

A couple of days ago I wrote the following letter to Twin Spires through their customer support client. Surprisingly, one of their customer support agents responded with a promise to put me in touch with a manager. Not surprisingly, management has opted to remain silent.

Here is my letter: "Why are you raising your takeout on Churchill Downs? Do you think your customers have been 'getting a free ride' and should be paying more for the privilege to place a wager? The takeouts are excessive and not competitive with any other form of wagering. One of the reasons I played at Churchill was the reasonable takeout (at least in terms of industry average). Now I feel like you do not respect my business."

It continues. The full post is here.  

Press Release: Playersboycott.org Discusses Their Player Action

Playersboycott.org Announces Boycott of Churchill Downs

http://www.playersboycott.org/pressrelease04252014.html

FOR IMMEDIATE RELEASE (April 25, 2014, San Diego, CA)

Playersboycott.org has announced that a horseplayer boycott of Churchill Downs is underway, citing an increase in takeout coupled with a massive jump in compensation for Key Executives at CHDN as reasons for the boycott.

"Key Executives at CHDN decided to hit horseplayers with a takeout increase," Playersboycott.org spokesman Jeff Platt said. "They suggested to the press an extra $8 million could be raised for purses if they multiply last year's handle numbers by this year's higher takeout rates. But it never works out that way. Takeout and handle share an elastic relationship.  Horseplayers are price sensitive. Higher takeout translates to lower handle and lower purses."

Platt cited takeout increases in California as an example. "For the first six months immediately following the takeout increase at Los Alamitos in 2009, their on track handle was down 27 percent. Horseplayers boycotted Santa Anita and Golden Gate in the early months of 2011 as a result of takeout increases there. Handle dropped significantly enough that track management and horsemen invited us to the table to talk about ways to stop the bleeding. As a result of those talks Hollywood Park put in a 14% takeout pick5 and Del Mar began adding $50k in seed money to their pick six pools on non carryover Sundays. Beginning this Saturday, April 26  Santa Anita will be offering rolling doubles at 18%. None of this would have happened if higher takeout was the answer."

"But that's not the worst part," Platt said. "According to Morningstar, compensation for Key Executives at CHDN jumped from $8.20 million in 2012 to $27.92 million in 2013. On the one hand CHDN is suggesting to the press the only way to raise $8 million for purses is to hit horseplayers with a takeout increase. While on the other hand, the same executives who decided on higher takeout saw their total compensation jump by more than double the amount they hope to take from horseplayers. In my opinion that's egregious."

Beginning Saturday, April 26 : Takeout for WPS wagers at Churchill Downs will be 17.50%. (An increase of 9.375% vs. last year's takeout rate of 16.00%.) Takeout for all EXOTIC wagers at Churchill Downs will be 22.00%.

(An increase of 15.79% vs. last year's takeout rate of 19.00%.)

• Playersboycott.org is asking horseplayers to consider the idea that horseplayers are consumers and that every handle dollar bet not just at Churchill Downs, but at CHDN owned tracks Arlington Park, Calder, and Fairgrounds, along with every handle dollar bet through CHDN owned ADW Twinspires.com, and every dollar spent downloading data and reports from CHDN owned data provider Brisnet.com is a vote for higher takeout everywhere.

• Playersboycott.org also wants horseplayers to know there will be plenty of tracks running this summer whose wagering menus offer better value than Churchill and that players have other options when it comes to choice of ADWs and data providers.

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Daily Racing Form: "Spring is in the Air"

Well a positive look at the new CD meet was tried, but I don't think it went over too well.


In a DRF Churchill preview, which was about the track opening, the article did not mention the raise in prices on customers.

....... but the comments section sure reminded Churchill Downs what's on people's minds:

"While DRF reported on the increased takeout rates on April 11, given that DRF is intended for horseplayers there is really no excuse for Mr. McGee not to have even mentioned the increases in this article. That is the "change in the air" of most importance to many DRF readers."

"The new spelling of GREED in American Racing: CDI. Mr. McGee, the BIGGEST change at Churchill this year is the increased takeouts to the maximums allowed by law and you did NOT think that was important enough to mention in this article. "

" I plan on spending zero dollars at churchill. Well, I lie....I'm going to put the biggest show bet on wise dan and have churchill enjoy a negative takeout pool "

"Nice fluff, Marty - meanwhile, Fair Grounds is crumbling away with a turf course that doesn't drain, a video board that doesn't work, broken doors, a prehistoric grandstand and price gouging on big days"

More at link

Beyer Talks Takeout

Andy Beyer:

"Whenever U.S. racetrack executives get together at industry conclaves, they talk endlessly about the need to broaden the sport's popularity and attract new fans. But perhaps their real problem is that their horseplayers don't bet enough. If crowds at American tracks wagered more than $400 per capita, as they do in Japan, instead of $162 per capita, the sport could boom without a single new customer.

...gamblers are reasonably rational about the economic decisions they make, and they know that horse racing is usually a bad gamble. Tracks typically take from 17 to 25 percent of every dollar wagered, and those in Pennsylvania have blazed new trails by grabbing an exorbitant 30 percent from trifecta wagers.

Even for the most astute professionals it is tough to beat such odds.

So it is no wonder that big gamblers in America prefer to call their bookie and bet on a sports event, where there is only a 4.5 percent disadvantage against them. If horse racing is ever going to attract big players, it will have to reduce takeout to more reasonable levels."

That article was written in 1991. 

You are absolutely correct customers; they never learn.

If you'd like to inform yourself about a grassroots boycott of Churchill Downs Inc and there associated racetracks and properties, it's here.

The Temperature Gets Turned Up on Churchill Downs Inc.

In the week or weeks before the Derby there is usually a news story from someone, somewhere, to try and forward their cause. Derby week is the one week that the world pays attention. In past year's we might've seen a New York Times story, or a story on steroid use. This year it appears there is a grassroots movement happening right as we speak.

Horseplayer Andy Asaro in HRI today:

"The boycott isn't only about the egregious takeout increase. This is about an industry that refuses to listen intently to what their customers are saying. It happens time and again.
This is about an industry that's still stuck in the 1980s when it comes to eliminating breakage, or timing races more meaningfully and upgrading coding of the tote system so that the information you see is what you get in real time and not after a race has begun.
Horse Racing 2014 style is still being played on eight-track cassettes, as if there were no such thing as the digital age. Haven’t you had enough?
There will be no official leader of this grassroots action. It will be led by the collective “we,’ all of us. The boycott will consist of fans, bettors and other practitioners of the sport.
It’s up to each individual conscience, and every outlet, to do their utmost to spread the word. If we allow this moment in time pass without a strong response, we deserve the industry we get."

Customers, not Joe Drape, or an activist group are involved this year.  Just customers.

If this was all there was the heat might not be turned up too hot - maybe just a pleasant sweat. However, it's not.

In an HRI column:

"Churchill Downs is a treasure. However, its parent company, Churchill Downs Inc., has done more to undermine the sport than any PETA video could ever do.


And more here.


It's not even Derby week yet where we see these headlines (and you know they're coming from other places), but from almost everyone we read, or listen to, Derby week has arrived early this year.


Industry analyst Dan Needham: "This is the most awkward and uncomfortable run-up to the Kentucky Derby that I have ever experienced."

Yes indeed.

Young Bettors Making Their Voices Heard

This piece about the CDI takeout increase was orignally posted on Doug MacPherson's blog Four-Forty.  Doug is an 18-year-old high school student from Ontario, and he can be found on Twitter @LDMcPherson.  In addition to writing on his blog, Doug has also contributed to HANA's Horseplayer Monthly.

I'm going to keep this short.
 
Churchill Downs is raising takeout rates. 17.5% WPS, and 22% for exotics. Just like every other takeout increase, they claim it's because they need to sustain purses, and just like every other takeout increase it won't work because bettors will bet less. It's simple math. It's terrible business.
 
I am not a big money gambler. In 2014 I have bet $624 in total. I don't make a difference to Churchill Downs. But I do make a difference to myself. If I bet into a high takeout pool, I hurt myself because my potential winnings decrease. Because of the increase, I won't bet on Churchill's races, or on any races at any of their other tracks. Why would I as a bettor play a track where I will not win as much money?
 
Not only will I refuse to bet any Churchill races (including the Kentucky Derby), I will tell other horseplayers about the increase. Many players don't know much about takeout. I will explain to them what Churchill is doing, and why it's bad for them as horseplayers. If they decide they want to support bettors, the people who fund racing, they will follow me in boycotting CDI. If they enjoy Churchill's racing and want to continue playing it, that's fine. It's their choice. The least I can do is tell inform them of the takeout increase.
 
As horseplayers who want to succeed, and also want the sport to succeed, it's important to let any track that wants to raise prices on us know that we will not meekly accept a takeout increase that will do nothing but hurt horse racing in the long run. Bye bye, CDI. Thank you for hurting the sport we love.

Horseplayers Share Their Thoughts on Churchill In Unique Ways

We have to hand it to Horseplayer Lenny. Not only is he a dedicated horseplayer who bets, attends tournaments, and offers to do his best to spread the word about tracks that want your business, he seems to be (with some help) quite the poet.

He has a five year old child, and it dawned on him that a children's classic could be modified for adults who play the races too.

Enjoy Lenny's Green Egg's and Ham, with a Churchill Downs takeout hike twist. 

You can follow Lenny on twitter @equinometry

Remember Horseplayers. No Vandalism!

Mike made us chuckle this morning.

Good luck today everyone. Enjoy the races.

Who scribbled this on the new @Churchilldowns $12 million video board? pic.twitter.com/pNQQPFpCcv

— Michael Dempsey (@turfnsport) April 19, 2014

Horseplayer Mike Maloney: 'Horsemen Groups Bought Churchill's Pick-Up Line"

The takeout increase by @churchilldowns has spawned quite a bit of reaction. Today we heard from horseplayer Mike Maloney. Mike is a long-time Kentucky resident and is a quasi-advisor to the Racing Commission and some racetracks.

Here's what he had to say:

"The increase is certainly frustrating for me personally as I've always tried to bet as much as possible at Churchill because my net cost of a wager was reasonable. Now the percentages tell me I have to slash my handle there.

The takeout hike also frustrates me from an industry standpoint because I think in the long term everyone involved makes less not more. Any reasonable observer knows moves like this mean fewer players betting less money in the long run and what industry can prosper by discouraging and/or eliminating it's core customers? It's a shortsighted money grab by CDI and shows a total lack of understanding of the elasticity of betting handle by the horsemen groups who were sold this idea as a long term solution. You would think by now the horsemen groups would do more due diligence before buying Churchill's pick-up line.

Now we must hope that in the long term best interest of Kentucky racing the Ky Racing Commission will adjust the regulation to require Keeneland and Churchill to operate under the previous takeout limits. And given the strong influence that Churchill routinely exhibits over the racing commission which is charged with regulating them, I am not optimistic.

Meanwhile, in the world where the laws of economics still matter, the horseplayer's highest rated track Keeneland, immediately announces no increase to their takeout rates and small but growing Kentucky Downs continues to lower takeout far below the max rates available."

We'll try to share more gambling economics, player reaction and otherwise here on the blog this week and next.

The View From Vegas on Churchill Downs - "Stupid, stupid, stupid"

We've heard a lot about the Churchill Downs takeout increase, announced last week, via email, or on social media, chat boards, through phone calls from HANA membership, or in the trade press. Most of this reaction is fervently insider led, from the people who live, eat and breathe horse racing.

Tonight we stumbled upon what we might call an outside view while surfing on twitter. We saw a gentleman with over 10,000 followers speaking about horse racing, and we were surprised, because we've never seen him before.

Chris Andrews, from his bio, booked his first bet as a fifth grader. Through high school Andrews and his cohorts continued booking bets and operating card games. Andrews paid his own way through college, hustling bets and making book to fund his education. After graduating cum laude from Robert Morris College, Andrews came west to Las Vegas. The next two years were spent at two of Las Vegas’ legendary sportsbooks, the Stardust and Barbary Coast, where he learned the old Nevada method of being a bookmaker. He took the knowledge from that experience and at twenty five was hired by Club Cal Neva. He turned the tiny Reno sportsbook into one of the biggest and most successful sportsbook in Nevada.

Chris, and his "cohorts" are exactly the people racing tries to reach. There's gold in them hills, because these are the players with a bankroll who like betting - racing included.

Chris's view of Churchill's decision to raise the juice is not unlike many horse racing gamblers, but it is a different view.

He writes:

"One reason circulated by those who think they know but don’t, is young bettors don’t have the patience to read all the data in the racing form.

That’s a complete load of crap.

Young sports fans, whether they are bettors or merely fans, have taken analytics to a level unimagined a generation ago. It started with baseball, and then evolved to football and basketball.  Now even hockey has metrics that were unheard of a few seasons ago. Unfortunately, the first thing these potential horse bettors analyze is the percentage they have to overcome to be profitable.

To win at football, basketball or hockey, it’s about 4.5%.  Baseball is about half that.  When they see horse racing’s house edge is north of 17.5% it’s an easy and logical decision they make to concentrate on other wagering options.

They probably have heard the horseplayers’ prayer.  You know, it goes “Dear Lord, please let me break even today.  I could use the money.”

and

"Churchill Downs Incorporated announced they were increasing their pari-mutuel takeout from 16% to 17.5% on win, place and show bets, and from 19% to 22% on exotics.

Stupid, stupid, stupid."

Horse racing wants to attract sports gamblers and others who enjoy the pursuit of catching a winner and making a little bit of money. If Chris's article is indicative of those people, Churchill Downs is not helping the cause.

To read Chris's article in full, at againstthenumber.com, it's right here.

Horseplayers Association of North America’s Annual Track Rankings: Updated 2014 Data Released, Churchill Downs Plummets

For Immediate Release

(Charlottesville, VA, April 12th, 2014): The Horseplayers Association of North America has re-released their 2014 Track Ratings.

“Although we normally release the ratings only once in April, and then update new numbers on our master sheet on our website as we crowdsource, we felt it very important to update the final ratings this year," said HANA President Jeff Platt.  "The recent increase in Churchill takeouts – win takeout up from 16% to 17.5% and exotic takeout up from 19% to 22%, as reported in the Courier Journal – needed to be reflected as a service to horseplayers.”

Churchill Downs, which originally ranked 5th, fell to 22nd in the 2014 ratings. Other Kentucky racetracks like Keeneland (1st), Kentucky Downs (2nd) and Turfway Park (9th) all cracked the new top ten.

The HANA Racetrack Ratings are based on an algorithm using factors which are indicative of horseplayer betting value, gleaned from both empirical and academic study. Key factors including takeout rate, field size, wager variety, pool size, and signal distribution are compared track to track, weighted, and a final composite score is given. Horseplayer and Industry Analyst Mike Dorr, a graduate of Vanderbilt University's Owen Graduate School of Management supervised this years algorithm.

For full Ratings coverage including statistics, analysis, interviews, and a list of all tracks please visit, “Horseplayer Monthly” here: http://www.horseplayersassociation.org/hanamonthly.html

The master sheet has also been updated and it's available here.  http://www.horseplayersassociation.org/hanatrackratingsbyoverallscore2014.html

The Horseplayers Association of North America is a grassroots group of horseplayers who are not affiliated with any industry organization. HANA hopes, through proactive change on several key issues (including but not limited to), open signal access, lower effective takeouts, affordable data and customer appreciation, the industry’s handle losses can be reversed. HANA is made up of over 2,500 horseplayers. 

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