HORSE RACING’S BUSINESS MODEL SAVED THE DAY IN 2020

Like all industries and sports, horse racing in the United States has been severely disrupted by the Covid-19 pandemic, with the rescheduling of the Kentucky Derby and Preakness sans fans, cancellation of race cards, summer gatherings at Del Mar and Saratoga negated, and the Breeders’ Cup held in front of empty stands.  However, horse racing has actually fared very well vis-à-vis the vast majority of leisure and entertainment businesses because its product can be distributed via television and phone/internet.

On December 4, Equibase released key performance metrics comparing 2020 through November to the first eleven months of 2019.  Total wagering in the U. S. was down in 2020 by only 1.48% vs. 2019 even though there were 26.28% fewer race days in 2020 (3,073 vs. 4,173) and 24.5% fewer races run (25,692 vs. 34,038). 

As of November 30, 2020, bettors had wagered $10,173,203,529 contrasted to $10,326,096,192 in 2019.  Yet average wagering per race day amounted to $3,310,512, up by 33.78% from 2019.  Average purses paid per race day rose slightly from $263,984 in 2019 to $264,285 in 2020.

Since the advent of simulcasting and later internet and telephone wagering, racetrack attendance has dramatically declined, with large racetrack crowds largely confined to Triple Crown and Breeders’ Cup days and to summer meets at Saratoga and Del Mar.  With the coming of the dreaded Covid-19 pandemic, having no on-track crowds was detrimental but could to a large extent be compensated for financially by off-track betting and telecasts.

From the standpoint of pari-mutuel handle, the 2020 data indicate that U. S. horse racing might be better off with less racing.  By contrast, less racing might be a negative for the bloodstock industry, but that is by no means a certainty because racing secretaries are already having trouble filling races…and races with more betting entries boost handle.

Copyright © 2020 Horse Racing Business

Click here to see the entire Equibase report of December 4, 2020.

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