IN SPITE OF A TORRENT OF NEGATIVE PUBLICITY, THE KENTUCKY DERBY SETS BUSINESS RECORDS

In the weeks and months leading up to the Kentucky Derby, horse racing in the United States was pummeled with negative press. Most notably, the New York Times ran a series of articles depicting horse racing in the worst possible light (never mind that the methodology on which the articles was based was severely flawed.) The Times followed up with an editorial that called horse racing a “disreputable industry.”

Moreover, ESPN—The Magazine printed a graphic picture of a racehorse down on the track after being euthanized. Then, just two days before the Kentucky Derby, Andrew Cohen of The Atlantic magazine published “The Kentucky Derby and the Slow Death of Horse Racing.”

During Derby week, a Congressional hearing on drugs in horse racing was held and generated considerable publicity. To add further fuel to the fire, a quasi-scandal surfaced at NYRA pertaining to allegations of cheating bettors.

In spite of this barrage, the Kentucky Oaks and the Kentucky Derby produced the following results:

The Kentucky Oaks on Friday (May 4) had near-record attendance of 112,552 (even though the weather was not ideal and racing was halted for about a half an hour) and had record handle of $39.9 million—up 6.5% over 2011.

The Kentucky Derby set an attendance record, with 165,307 people, up from the previous record of 163,628 in 2011. All-sources handle for the Kentucky Derby card was $165.2 million, which was a 13.2% increase over 2011. All-sources handle on the Kentucky Derby itself was $137.1 million; this represented an 18.8% increase over 2011 and a 12.4% increase over the previous record handle in 2006.

Racetracks all around the country showed substantial increases in both attendance and handle. For instance, Hollywood Park Casino at Penn National Race Course experienced a 21% increase on Derby betting over 2011. Some advance deposit wagering websites slowed to a crawl near race time and one reportedly went down altogether.

Given the contemporaneous and virtually unrelenting bludgeoning that horse racing took from a few leading newspapers and magazines, these results are amazingly strong. NBC-TV deserves much of the credit for the effective way the network promoted the race. But there is more at work here because Keeneland also had a record meet in the weeks prior to the Kentucky Derby and national pari-mutuel wagering is reversing its downward direction.

One can state with a high degree of confidence that wagering on the Kentucky Derby card would have been even more robust had horse racing not been so undesirably portrayed in some print sources.

Like all mature industries, horse racing in North America is undergoing severe disruptions and consolidation, but it is far from moribund, as the data show. The outstanding wagering on the Kentucky Derby was not confined to Kentucky, as the all-sources figures clearly demonstrate.

Horse racing will never return to its halcyon days before casino and lottery competition, but to assert that it is dying is to ignore facts.

Postscript

The downward trend in newspaper circulation shows that these former media kingpins are increasingly losing their clout and their ability to shape public opinion, as the digital world takes over.

When the New York Times published its series on horse racing, I wrote that newspapers like the Times sensationalize in order to gin up flagging circulation. A former racing columnist for a major newspaper indignantly commented: “To blame the New York Times and its so-called agenda – especially loathsome is the accusation that the series was crafted out a need to build circulation – is shameful. The New York Times is the finest newspaper in the country…”

That’s like saying the horse is the prettiest one in the glue factory.

Copyright © 2012 Horse Racing Business