BREEDERS’ CUP HANDLE TRENDS SHOW BRAND DILUTION

The 2013 Breeders’ Cup was the 30th annual running.  In 1984, the inaugural event, the Internet was not available to the average person, so off-track betting was achieved by telephone or at a racetrack or off-track betting facility via simulcasting.

As the following table depicts, $19.5 million was wagered in 1984 on seven Breeders’ Cup races held in a single day.  The handle, adjusting for inflation, was equivalent to $43.7 million in 2013.  The table demonstrates how handle has increased over the years in actual dollars and inflation-adjusted dollars.

                            Total Handle    Total Handle, 2013 Dollars

1984 (7 races)       $19.5 mil                    $43.7 mil
1994 (7 races)       $79.6 mil                    $125.2 mil
2004 (8 races)      $120.9 mil                  $149.1 mil
2013 (14 races)     $160.7 mil                  $160.7 mil

Total handle increased dramatically between 1984 and 1994, as the event grew in popularity.  In 2007, the Breeders’ Cup was expanded to two days and the number of races was increased from eight to eleven (14 races were held in 2013 and 13 will be held in 2014).  Yet, in real (inflation-adjusted 2013 dollars), handle was greater in 2007 ($165.4 million) than it was in 2013.   Moreover, the 2007 handle was undoubtedly depressed by the wretched weather at Monmouth Park.   (In actual or nominal dollars, total handle in 2007 was $147.3 million compared to $160.7 million in 2013.)

The next table illustrates Breeders’ Cup handle on a per-race basis. Between 1984 and 1994, when there were seven races, per-race handle soared in actual dollars and inflation-adjusted dollars, then climbed at a much slower pace between 1994 and 2004 (the number of races was increased to eight in 1998).  By 2013, the per-race handle had been cannibalized by the addition of six more races.

                Handle Per Race    Handle Per Race, 2013 Dollars

1984           $2.8 mil                      $6.3 mil
1994           $11.4 mil                     $18.3 mil
2004           $15.1 mil                     $19.1 mil
2013           $11.5 mil                     $11.5 mil

The forgoing historical wagering data for the Breeders’ Cup demonstrate that offering more of something is not always an improvement.  The trends in total handle and per-race handle suggest that the Breeders’ Cup brand has been diluted by adding races and extending the event to two days.  A return to the original one-day format with about eight races would be likely to foster better television ratings and more wagering.

Copyright ©2014 Horse Racing Business

Comments

  1. The BC has watered down its product, as your figures show. Managers of a good thing usually try to squeeze out more and more and end up with a lesser thing than they had early on. I know a BC board member who says the event was suppose to bring in more fans to a championship day of racing, which was the case in its early period, but expanded to too many races in which casual fans can’t name one horse running. I’m more than a casual fan and don’t know much about the horses entered in the fringe races.

Speak Your Mind

*