Over the last 15 years wagering in all forms in Australia (leaving out gaming, casinos and poker machines) has doubled to its current total of $23.5 billion. That represents an average growth of about 4.6% p.a. But that figure disguises a lot of sins.
At the bottom is thoroughbred racing, which increased by an average of only 3.4%. Harness and greyhounds combined rose at 5.2% p.a. The big change has come from Sports betting which jumped from almost nothing to now comprise 14.2% of all wagering, just behind greyhounds at 14.6%. Harness is on the decline at 10.0% currently, while the thoroughbred share of total wagering has dropped from 75.6% in 1995/96 to 61.2% in 2010/11.
Racing turnover has been influenced by the addition of new betting operators and new meetings, first in the mid- to late-1990s and then following the establishment of SKY2 in mid-2010. Of course, they also attracted extra costs.
One thing is certain, after correcting for inflation (a bit under 3% p.a.), wagering on racing has declined on a like-for-like basis. You could therefore say that wagering is now less efficient than it used to be. The same horse or dog race is attracting fewer dollars than it did 15 years ago
Only Trackside (Tabcorp’s four-legged poker machine), mug gamblers, occasionally kind hearted governments, and fresh energy from NT bookmakers and Betfair are keeping the industry’s head above water. As those factors increase in importance, it follows that the numbers of serious punters are on the decline.
The simple fact is that racing is not as popular as it once was, and may well continue on the downward slide. It’s more a lark than a devotion to the cause. Sports betting is rocketing ahead while greyhounds are doing a bit better than the other codes. Greyhounds would be doing better again if they did not have to use their TAB takings to subsidise thoroughbred and harness racing in NSW and Queensland (and previously in SA). On the other hand, Victorian racing has been gaining unearned income from re-directed taxes on the state’s poker machines. Tasmanian racing has done well since the government did a deal with Betfair to set up its headquarters there. Again, a windfall gain.
Keep this in mind when you read wonderful words from the various greyhound racing authorities and their respective Ministers. The spin needs to be filtered.
The questions to consider are (a) is racing a good business, (b) is it being run well and (c) where is it headed?
It should be a good business. It’s spectacular, colourful, dynamic and, particularly in the greyhound case, very easily packaged and presented. Mind you, everyone loves horses but very few like the look of a greyhound, according to some past surveys. No doubt that’s still a carryover from the bad old days of live hares and go-fast drugs. Still, measures like the retired greyhound adoption programs and sophisticated drug detection methods are helping combat that image, albeit very slowly.
Other stuff – like SKY guest presenters giving you tips as the dogs go into the boxes, or reading out someone else’s tips in the formguide – is of little use. And TAB strategies which favour mug gamblers are doing nothing to better educate customers or build a better income base. Crooked stewards in NSW harness and greyhound codes, and illegal betting by Victorian greyhound employees are unfortunate negatives.
But the lack of professional attention to customers must be racing’s biggest single handicap. It certainly came to the fore during the years of the mishandling of NT bookmakers and Betfair. Once roundly abused by old-fashioned racing establishments across the nation, they are now the industry’s saviours. Just check the promotions which are boosting club and authority incomes.
However, the key issue there was not so much what authorities said about the newcomers but that they ignored with wishes of their customers, who were flocking in droves to the newcomers as soon as they opened shop. Obviously, racing bosses just did not bother to check with the people who were providing their revenue.
Even today, greyhound authorities are happy to tell us how many hundreds of people attended race meetings, ignoring the fact that the majority of them are not customers at all, but owners, trainers and their parties. Being forced to pay an entrance fee does not make you a customer. Indeed, I have been to many meetings where the genuine customers could be counted on your fingers.
Amongst all the factors affecting the progress of greyhound racing, the lack of attention to customers is surely the most influential. Once they disappeared from the racecourse and sat in front of SKY screens the guts fell out of the industry.
Pre-TAB (ie pre-1963) raceclubs looked after the customers. Pre-SKY (ie pre-1989) that interest had started fading and the monthly cheque from the jolly green giant became dominant. Following decades of strong growth, betting turnover remained flat from 1990 onwards. Today, only the blood transfusion from NT bookies has kept the body alive and kicking. But you can’t keep pulling the rabbit out of the hat. What will be the industry’s next trick?
More on that later.
(Figures in this column came mainly from the annual Fact Book published by the thoroughbred’s Australian Racing Board – an excellent publication. At the time of writing, Greyhounds Australasia has not produced 2010/11 figures. Bits and pieces are available in state authority annual reports but are not easy to collate).