ELMONT, N.Y. — Walking through Belmont Park is an unsettling experience, especially for anyone who remembers America’s most imposing racetrack in its glory days. The grandstand that stretches nearly a quarter of a mile used to be packed with tens of thousands of fans, even on weekdays. Last Saturday’s attendance of 5,628 made the cavernous facility feel like a mausoleum, and on weekdays the crowds are half that size.
Near-empty grandstands are, of course, a familiar sight for the modern-day U.S. racing industry. But Christopher Kay, the chief executive of the New York Racing Association, doesn’t want to accept them as the new normal.
Kay took the helm of NYRA in July, just in time to spend the summer at Saratoga, the nation’s most successful track, packed with large, enthusiastic crowds six days a week. But when NYRA moved its operations downstate after Labor Day, Kay saw what the sport looks like most of the year.
Kay was hired after NYRA had been rocked by controversies and scandals and its CEO deposed. Governor Andrew Cuomo, no lover of horse racing, orchestrated a coup that gave New York State control over NYRA. Dealing with the state’s politics and bureaucracy would be a full-time job in itself, but Kay’s background won’t let him ignore the challenge of attracting and caring for customers.
He has been the chief operating officer of Toys ’R’ Us and an executive of Universal Parks and Resorts, two businesses in which taking care of customers is paramount. When Kay talks about racing, he uses language he probably employed in discussing visitors to Universal’s theme parks.
“What I want to do is provide an enhanced guest experience,” Kay said. “We’re stressing the importance of engagements with our guests.”
He believes that NYRA can do an even better job at Saratoga, and he believes he can revitalize Belmont — by treating customers better, staging special events, offering better food and arranging the seating to eliminate the mausoleum feeling.
Kay will not succeed in transforming Belmont, but can be forgiven for being unrealistic, because he is a newcomer to the sport and even most industry veterans don’t understand the dynamics of on-track business vs. off-track business.
The sport underwent a profound change in the 1990s, when horseplayers got the chance to watch races on a computer or home TV and to bet by computer or phone. The vast majority of them saw that playing the races from home is a better experience than going to the track. They don’t have to take a slow-moving train to Belmont Park or crawl along the Capital Beltway to Laurel Park. They don’t have to pay for admissions, parking or overpriced food. With a computer on their desk, they have all necessary handicapping information at their fingertips. Nothing a racetrack can offer will trump these conveniences.
The few tracks that still offer a vital live product are all beneficiaries of special situations. Saratoga, Del Mar and Oaklawn Park are resort/spa destinations with long histories and a special ambience that lures a broad spectrum of fans. Keeneland and Churchill Downs are in a state where horse racing is ingrained in the culture.
Almost everywhere else, technology has changed the business as fans opt for the ease of betting with a computer. Most other businesses eagerly embrace such technological advances. In an era when people can deposit a check by using a smartphone, executives at Bank of America don’t yearn for the good old days when people went to a grandiose downtown bank and stood in line to make a transaction. Yet the racing industry seems distressed by change. Its leaders despair over empty seats more than they cheer the expanded reach of their business. The media reinforce this negativity. Newspapers regularly run photos of barren grandstands to demonstrate the decline of thoroughbred racing
The empty seats represent a shift from on-track business to off-track business. In 1983, when the Belmont grandstand with bustling with activity, the average daily betting at the summer meeting was $3.46 million. Adjusting for inflation over three decades, that amount is the equivalent of $8.12 million today.
At the Belmont summer meeting of 2013, wagering averaged $10.1 million per day — exceeding the figures from the supposed good old days. NYRA vice president David O’Rourke says it is a conservative estimate that 25,000 individuals away from the track are betting on an average day.
Of course, on-track customers are more profitable; they pay admissions and buy food, and there is no middleman taking a cut for processing their wagers. Nevertheless, just 7.6 percent of the money bet on the Belmont races this fall comes from people at the track. Does it make sense to obsess about taking proper care of on-track customers while taking for granted the other 92.4 percent?
For decades, tracks have recycled tired gimmicks to promote live attendance (rock concerts, T-shirt giveaways, Family Fun Days, etc.), which never have any lasting impact on a track’s business. Perhaps clever marketing departments should reach out to gamblers at online poker and sports-betting sites and try to introduce them to the greatest of all gambling games.
Tracks should focus on improving their Web sites and their own betting sites. (Kay understands this, and developing the NYRA Rewards wagering platform is one of his top priorities, though the project has been bogged down in typical New York red tape.) Tracks should look for ways to communicate important information — such as late changes and scratches — to customers who are in no position to hear announcements on the public-address system. (E-mail and text alerts, perhaps?)
Racing executives should understand the changes in customers’ betting habits and explain them to the media and the public, in order to dispel the notion that diminished live attendance means that the sport is dying. When Chris Kay walks through a barren Belmont grandstand, he should be thinking, “We’ve got a great crowd today; they’re just not in our seats.”