In a gravelly voice that clearly has spent many hours cheering teams and horses, race and sports book legend Victor Salerno offered racing some verbal encouragement as it prepares for fast-emerging legal sports wagering.
Salerno, a 40-year veteran of the race and sports book industry in Nevada, offered that encouragement at the Sports Wagering and Impact on Horse Racing Symposium presented by BloodHorse and Breeders’ Cup Sept. 6 at Keeneland. Three panels at the symposium outlined the opportunities and potential challenges for racing, as legal sports wagering comes online throughout the country. Racing relies on pari-mutuel wagering as its economic engine.
“You shouldn’t be afraid to do this,” Salerno said of tracks also offering sports wagering, noting tracks that do so will increase their foot traffic, providing opportunities to reach new customers. “Racing’s a great sport; we have to keep it going.”
At the three-hour presentation, panelists touched on wide-ranging topics related to sports wagering, including the benefits and challenges of offering sports wagering at tracks; opportunities for current advance-deposit wagering companies to expand to sports wagering or partner with sports wagering sites to cross-promote one another; an opportunity for racing to provide needed content for wagering in this new environment; the addition of non-pari-mutuel wagers in racing, like fixed-odds bets; and challenges that could include a competitive disadvantage as high-takeout racing in an atmosphere where low-takeout sports betting will be readily available.
Monmouth Park vice president of business operations Bill Knauf offered some firsthand experience since the New Jersey track brought in William Hill to operate on-track sports wagering in June. Knauf said the sports betting crowd is largely male and younger than the typical horseplayer. He noted the sports betting crowd has helped the track improve its simulcast handle as bettors are showing up early and staying late to watch West Coast baseball games.
Knauf said tracks have plenty of available parking, interior space that readily can be used to build first-rate sports books, and through their simulcast operations are familiar with bringing in multiple TV signals. He noted tracks routinely offer more such signals than even a Las Vegas sportsbook.
Panelist Victor Bigio, an online gaming marketer at Sportech, said tracks also have the space to host eSports events that are quickly gaining in popularity with young people. He said tracks should take advantage and offer those events and accept wagers on them.
Many states soon will be making these decisions. Beyond the three racing states that have already launched full sports wagering this year—New Jersey, Delaware, and West Virginia—Sara Slane of the American Gaming Association noted another 19 states have had bills proposed.
William Hill U.S. executive Dan Shapiro noted the planning that went into Monmouth has produced a facility where sports betting and race betting are well-integrated. He said a sports betting facility at Hollywood Casino at Charles Town Races is in the casino and separated from racing. He thinks the Monmouth model has a better chance of success for both sports wagering and race handle.
“What Monmouth has done with that integrated experience is the model we think tracks should look at in the future,” Shapiro said.
Just hours after TVG (FanDuel Group) announced Thursday plans to add a pair of Sunday morning shows that will largely focus on betting the NFL, FanDuel Group general counsel John Hindman said that variety should bring a more diverse group to the racing channel and its various sports and race wagering platforms.
He said the FanDuel platform will market race wagering, noting it will be presented in a way that will make sense to sports bettors. He also noted the benefits of cross-marketing—millions of dollars have been spent promoting FanDuel, initially a Daily Fantasy site, in recent years.
One aspect of betting sports those customers understand, on some level, is takeout in the 5% or 6% range. Ed Hannah of The Stronach Group said with those expectations, racing will need to thoroughly examine its much higher takeout (the amount of money not returned to bettors in winnings, which in racing is retained largely for tracks and purses) as it tries to attract new customers and retain current players.
“Lesson No. 1 is the takeout rate is too high. We need to figure out a more optimal takeout rate,” Hannah said. “There’s a little more wiggle room on multi-race or multi-interest wagers.”
He noted that in the online atmosphere, sports bettors will quickly notice the difference.
“People putting money in their deposits will notice that difference,” Hannah said, explaining that because of takeout, the average sports bettor can make a $100 deposit last much longer than the average horseplayer. “We have to do a lot of thinking about (takeout).”
Sports betting faces its own battle for customers, many of whom currently wager through illegal bookmakers, local or offshore. Panelists noted that one way legal operators will be able to compete is by offering a greater variety of wagers and events. They said the frequency of races, offered throughout the week, should prove attractive to sports betting sites.
Hindman noted that race wagering routinely is one of the top sports in terms of handle in other countries that already allow sports wagering.
While panelists offered a wide variety of opinions and ideas, all acknowledged the fast-changing landscape and racing’s need to be innovative rather than shrink away.
“We can take (the emergence of sports wagering) and put it toward the enhancement of the racing industry here,” Salerno said. “Don’t be afraid.”