JOHN GALLINGER, the Chief Executive Officer of Standardbred Canada, joined the organization in May of 2010; the Richmond Hill resident came aboard with over 13 years of leadership experience
already under his belt. From 2003 to 2010, he was with Magna Entertainment Corp., a company that owns some of the premier racetracks in North America, a racing channel, a tote company, and an account wagering company. Working as Chief Information Officer after 2006, he was instrumental in several of MEC’s most innovative and forward thinking projects.
Having now led Standardbred Canada through an entire fiscal year, Gallinger here shares his thoughts, experiences, and opinions on a wide variety of topics relevant to our industry.
Interview By Kimberly Fisher & Darryl Kaplan
ON THE STATE OF CANADIAN HARNESS RACING... ?
Overall, across the country our product is strong, being led by Ontario. But having said that, we need to be ready to really challenge ourselves and look for opportunities to grow the sport. The on-track product is strong, but the underlying economics that support it – the wagering dollars – are not where they need to be. This concerns me. Many will argue that it is not SC’s place to be concerned about such matters, that we’re the breed registry and the record-keeping body, but part of our mandate is to protect and promote harness racing.
I think that what’s needed is to challenge the status quo – nationally and on a global scale. We need to evaluate the way we present, market, and deliver the product to the end consumer.
I don’t have any silver bullets or ideas that haven’t been discussed a million times. I made this clear during the town hall meetings with respect to the RDSP (Racing Development and Sustainability Plan for Ontario). But I believe that most people recognize that changes are required. The challenge is to obtain agreement on who should lead and pay for the change.
Outside of Ontario, there are challenges, strengths, and reasons for optimism. The recent opening of West Meadows in Saskatchewan is a great story. It shows the resiliency of our industry and the passion of our participants. The partnership between the racing community and the provincial government in PEI has positioned PEI for growth and has been beneficial to the entire Atlantic region.
ON THE SLOTS PROGRAM... ?
This is going to sound a bit cliche – everybody says this – but slots are not a fix for our industry. The partnership that exists in many jurisdictions between the racetracks, horsemen, and slots operators is valuable and beneficial to all stakeholders, not just our industry participants. As an industry we need to embrace, protect, and grow these partnerships for the mutual benefit of all stakeholders. Slots programs have certainly been beneficial to our industry, but I think it needs to be about more than just increasing purses and funding horse improvement/breeding programs. This is certainly an important use of the funding, though, because that’s the money that churns back into the industry through the sales and keeps that circle flowing.
I do think that in the jurisdictions which already received slots, if people were to look at it objectively, and turn back time... I hope that they might have done things differently, and set a percentage of money aside for strategic planning in and around the industry. What are the things we need to do? Part of it is marketing, part of it is looking at changing our wagering product, and part of it is keeping up with technology advancement so we can deliver services in a manner that consumers expect in today’s world.
Hindsight is 20/20, and to make any changes now requires agreement from many different stakeholders, which is difficult. But I think if jurisdictions were able to look at it from the perspective of growing the racing industry and positioning the industry to compete with other forms of gaming and entertainment – objectively, people would say that we should have set aside some money to invest in marketing, and product and technology updates.
ON THE IDEA THAT THERE IS TOO MUCH RACING…?
I’m not sure that there’s too much racing. Right now we have a fixed set of customers, and we need to grow that customer base. Our customers only have so much money they are willing to spend on racing, so if we have more racing dates, that money is being spread out amongst those dates. If we have fewer race dates, would the same customers bet more? I think the average handle per race would certainly go up, but I’m not convinced that total wagering would stay at the same levels. If we had fewer racing dates, I think we would have less wagering. But those facilities that had wagering – those racetracks that had the races – would make more money. Would this create
a healthier and more sustainable industry? I’m not convinced of that. There needs to be opportunities for horses of different classes to compete. We need to hold onto the dates we have, and look for ways to make each date more successful.
I think as an industry one thing we could do better is the scheduling of racing within the night; not only scheduling so that we’re not racing on top of one another, but also in communicating and adhering to post times. This will become more important as tracks move towards exporting their product internationally.
Again, having more races on any given day is not necessarily a bad thing, especially if there’s a major stake race on that day; customers will be engaged, and wagering on that race, so they’re likely going to handicap the other products that are out there that day as well.
ON THE EXPORT OF PRODUCT... ?
Should we as the breed registry be looking to export the product outside the country? Yes, most certainly. This is true for both our race signals and for exportation of our breed. With respect to exporting race signals, this decision lies with the tracks, but Standardbred Canada should do what it can to promote the strength of our product and to facilitate relationships with potential importers. You know, you take a single product and sell it into as many places as you can – this is one opportunity to increase our revenues.
In terms of exporting horseflesh, SC needs to work with and on behalf of our breeder members to see if we can develop a better program for advertising and facilitating the export of the Canadian breed.
ON THE RECENT CUTBACKS BY THE CPMA... ?
In some respects, I’m sympathetic to the challenges of the CPMA. They have a very important mandate in terms of protecting the wagering public, but their funding comes from the wagering dollar, so the issue that we talked about – the decreasing handle – it’s really affecting them.
There is some criticism because they’ve reduced service levels on things like photo finish or drug testing and/or pushed down the responsibilities and costs of those services to the provincial regulators. So it’s not that the costs have been removed from the industry, because the services are still required. They’re just no longer being performed, in many cases, by the CPMA. It would be nice if there was other funding – federal funding – that would help deal with the issue that the levy from the handle has been decreasing, but at the same time I think we have to be careful about asking for additional funding... this sends a challenging message.
ON WHERE WE FIT IN A SPORTS/ENTERTAINMENT/GAMBLING LANDSCAPE... ?
The racing industry has been arguing this back and forth for years. People say, well we need to promote the wagering aspect – let’s be honest, that’s what we are. That’s what generates our revenue, and that’s how we fund our business. Others will say, no, we are a sport that allows wagering on it. We need to sell the passion, we need to sell the sport… we need to promote both our equine and human heroes, and that’s what’s going to grow the sport.
I’m not sure that we need to be one or the other. I think we need to promote both aspects and there’s a different audience for each. There are those who will view it as a wagering outlet, and there are fans who will view it as a sport. So to say that it’s all about wagering I think would be wrong, but to ignore the wagering aspect of it would be wrong as well.
Many provinces are looking to legalize online sports wagering, so today and even more so in the not so distant future wagering will be an aspect of all sports. Harness racing needs a plan as to how it will adapt and fit into this changing model.
ON WHAT I LOVE ABOUT HARNESS RACING... ?
As some know, I started my racing career with Magna and this is where I fell in love with racing and the industry. I find that the culture and the people involved in racing are better than what I have experienced in any other industry. I enjoy live harness racing at all levels, no matter if it is a $5000 claiming race or the NA Cup. If the field is competitive, it’s an exciting race to watch, only made better by a modest wager. The other aspect that I love about Canadian harness racing is working with people that have a real passion for their industry… it’s refreshing.
ON FAMILY INVOLVEMENT WITH RACING... ?
More recently I’ve started taking my son, who’s six, to the races occasionally, and he enjoys it. My daughters who are three... they love horses but they don’t yet understand the concept of racing. My kids loved going to Mohawk on fireworks night. They have vivid memories of being in the winner’s circle that night when Jody was presented his Canadian colours for the World Driving Championships. Jody took a few moments to say hi to the kids, making a lasting impression. My wife comes with me occasionally to the track, but for now it’s hard to get her out more often with our young family.
ON MY FAVOURITE LIVE RACING MEMORY... ?
I would say my favourite event was the Gold Cup and Saucer I attended in 2010. It was really refreshing to see everybody that was there was there to watch the races. Whether it was the Gold Cup or the two days of racing leading up to it – everybody was engaged. It was amazing. The pre-race introductions for the Gold Cup & Saucer are legendary, and I certainly couldn’t describe the atmosphere in a way that would do it justice. If you have never been, you must go.
It was very exciting to watch when Part Shark won the Gold Cup and Saucer. The race was hyped all week in the local paper, The Guardian, and when Part Shark and Scott crossed the line first the place was electric. I remember I was only maybe 50 feet away from Jim and Barb Lehman and the other winning connections in the winner’s circle, sort of standing back by myself just watching them. For me it was special moment – seeing their excitement as relative newcomers to ownership. I knew how much it meant to them to win the race.
ON WHAT WE DO AT STANDARDBRED CANADA & OUR ROLE GOING FORWARD... ?
First and foremost, we are the breed registry. So we always have to make sure that we are taking care of our core mandate. The industry also relies on Standardbred Canada to collect, store and disseminate all forms of industry data, and that of course has to our primary function. But our mandate also includes the protection and promotion of harness racing, and to be successful at that, we need to spend additional resources on government/stakeholder relations and marketing. Government relations has become a larger focus of late, but the challenge is limited resources – human and financial.
IN 20 YEARS, WILL THE PRODUCT BE DIFFERENT FROM WHAT IT IS TODAY? ?
I’m not sure that I know the answer to that. I think we need to try different things and be open to change. The racing model isn’t the same around the world, so maybe here in Canada and North America we need to be open to trying different things. We need to rethink and be prepared to change the wagering aspect of our product. Exchange wagering is coming; fixed-odds sports betting is coming. We’ve got this model that is pari-mutuel based, and there are tons of advantages to pari-mutuel wagering, but we are always struggling with the issue of a takeout that’s higher than other forms of gaming. We need to see if we can address that issue.
ON THE IDEAL. NO RESTRICTIONS. WHERE ARE WE IN 10 YEARS? 20 YEARS?
No restrictions, in a perfect world… There needs to be a healthy presence of harness racing across our country. The racing industry will have developed healthy relationships within the community and will be viewed as valuable by all stakeholders. There will be a mix of amateur driving circuits, “grassroots” and “premiere” racing. Canada can and should strive to be the best at all levels of racing. Our professional products should be in demand by the wagering consumer on a global basis.
We need to get to the point where we are distributing our product (in an ideal world) across the globe. We need to grow, and we need to grow internationally.
In a perfect world, racing will have regained a larger presence on television... or on whatever the mainstream media is going to be twenty years from now. Whatever that distribution model is going to be, we need to be part of it. We need to get eyeballs on our sport and be an integral part of everyday life. Clearly we have a lot of work to get to this stage, but we should set our sights high.