The 2019 World Trotting Conference continued on Thursday (May 29) with a plenary session focused on wagering that featured Hasse Lord Skarpoth, Aymeric Verlet and Andrew Kelly.

Hasse Lord Skarpoth, the CEO of ATG, took the opportunity to discuss how horse racing as a sport can become a more attractive product.

Skarpoth stated that packaging is extremely important, and also stressed that nothing is more attractive than the finish of a horse race. The horse racing industry has not been willing to change, according to Skarpoth, and yet everything else has changed, including technology and customer demand. Skarpoth stated that he was confused as to who the customer was when he became the CEO of ATG in 2013, as the breeders, owners and customer all wanted different things. Skarpoth sees the handicapper as ATG’s customer, then the owners, followed by the breeders. “Who do we listen to?” Skarpoth asked, rhetorically. He stated that F1 has done an incredible job of focusing on the content (e.g. five cameras installed in each car). Skarpoth also pointed to the NBA, stating that, to the global basketball giant, the ‘event’ comes first, then the ‘game.’ He then quickly referred to another product, cricket, in which matches have now been shortened from five days to three hours. If you ask Skarpoth, these changes are happening to attract younger audience and a female audience. He shifted his focus to the betting industry in Sweden, which is split between ‘instant’ games; like traditional casino offerings, poker and horse racing, and ‘slow’ games, like sport pools, and multi-race horse racing pools. Skarpoth stated that there has been a higher increase in wagering with ‘instant’ betting. He went on to say that ‘TV’ needs to be at least on par with what other major sports organizations are offering the customer. Skarpoth stated that horse racing needs to define the finish line and needs to identify the numbers of the horses for the consumer. He believes that racing needs to identify who drives change and the industry must be benchmarking its product because it needs to be better than its competitors. You need to be best. Skarpoth also addressed the amount of downtime between races, and also discussed the ratio of action to downtime in racing compared to other popular sports, mainly hockey. He stated that horse racing has the best product, but it tends to not have the best packaging.

Aymeric Verlet, PMU, Racing and Wagering, took the opportunity to discuss some of the observations and changes that the PMU has been overseeing.

The PMU funds sport and is the leading pari-mutuel horse racing wagering operator in Europe. It promotes betting in France and abroad and also deals with sports betting and online poker. It is an economic interest group which is under the support of the Ministry of Agriculture and Finance. It represents 59 horse racing associations. Wagering is the funding pillar to horse racing, said Verlet, who stated that wagering/funding is a key point addressed by international agreement. In 2018, the PMU gave back $781 million to French Horse racing associations to fund the local racing industry and 25 million Euro was given back to foreign racing associations. The aim of the PMU is to keep horse racing alive, and the organization is very concerned with the decline of wagering on horse racing. The PMU has adopted a new strategy – since last January – which includes more racing, new wagers, and an increased focus on increased wagering. Verlet explained that as wagering increased, so did the variety of bets. He stated that new competition has negatively impacted wagering. The PMU tried to tap into the casino and lottery markets, but did not succeed. The PMU’s new strategy is very aggressive due to negative trend lines. The new strategy features three key themes: 1) Retention – Racegoers – Pleasure of the game/expectation of wining; 2) Conversion – Close non-player – Clear and accessible offer; 3) Penetration – General Public – New image of PMU brand and horse racing. Objectives include decrease the number of races, optimize the betting experience, make the racing schedule clearer. The PMU has adopted a ‘less is more’ approach, which has led to the daily jackpot being replaced by a weekly jackpot. The new PMU strategy also includes a more condensed schedule, featuring reduced racing and times of racing (starting at 12 noon on weekdays and 11 a.m. on weekends; last race at 8 p.m. during the winter, except Sundays; 18 minutes between two races and 12 minutes between a foreign and a French race).

Andrew Kelly, CEO, Horse Racing Australia, discussed some wagering trends that his organization has seen down under.

Kelly stated that 98 per cent of funding comes from wagering, and that wagering grew at 8 per cent in Fiscal 2018. Kelly stated that wagering in Australia has grown 23 per cent in the last five years, and that the spike has come after a shift from the pari-mutuel system to the fixed-odds model. Kelly said that Australia racing fans want fixed-odds wagering, and that opportunities like export product, import product and in-play betting have to be determined. augmented reality where life meets technology. Kelly discussed in-play betting further and characterized it as a growth opportunity. He also stated that future fans are online-gaming with growth that is unprecedented.

A CEO Roundtable followed, featuring the heads of Svensk Tavsport, PMU and Horse Racing Australia.

The roundtable stressed the need to create an event at the track – that’s where it starts and ends. The roundtable concluded that the V75 is a great example of how to promote and position the sport, not only to race fans, but also the general public. The CEOs said that the V75 has put the sport on TV and has really enhanced the interest. They stated that there is a need to package the product; there should be a focus on the product offering, and that product offering varies to much from one track to the other. The roundtable also stated that pool merging may be the next step in the evolution of horse-race wagering, however, with competing countries and political agendas, it is an extremely difficult task to achieve. The CEOs stated that horse racing betting companies need to work much closer in the future. In Europe there are big issues, including the competitive bookmakers, that need to be solved in order for everyone to work together (even though the wagering entities are competitive, there are several common interests between them). The roundtable came to the conclusion that associations need to have a ‘Innovation Director.’ Organizations need to have someone that is thinking about how to improve the sport and drive the business of the sport. The CEOs stated that the industry needs the same rules for the fan and the product across the globe. The industry also needs to realize that all would benefit by taking a change-management course. The hardest organizations to change are those that have been around in well-entrenched industries, and those that are leading the industry tend to have been around for a lifetime, which describes the horse racing industry. The roundtable came to the conclusion that the industry needs to understand the distinction between ‘gambling’ and ‘wagering.’ The distinction is important to make while promoting the sport. Thirty per cent of adults in Sweden bet on horse racing. Only two per cent of those handicappers suffer from ‘problem gambling.’ The roundtable also came to the conclusion that the industry needs to be well aware of its positive economic statistics – they are needed in order to ensure that the government understands the importance and significance that the industry offers and contributes to economic drivers.