Horseracing’s marketing machine faces huge hurdles if the sport is to dispense with its seedy, downmarket image and attract new blood in the form of young audiences and the money which chases them. But though the BHB is at last cracking the whip, its campaign is chronically underfunded.
British horseracing is staring down the barrel of a loaded gun. Unless it can attract a younger market and discard its seedy, downmarket image, many observers believe that, like its ageing punters, the industry faces imminent death.
The sport’s governing body, the British Horseracing Board (BHB), says the sector is in dire need of a marketing shake-up. It wants to attract elusive 18- to 35-year-old ABC1s to boost sponsorship and marketing opportunities.
The BHB unveiled its plans last week (MW December 2) in a 100-page independent report commissioned from sports marketing consultancy Michael Humphreys & Partners. The main proposal is that the body should embark on a three-year, &£30m marketing campaign, with &£12.9m earmarked for the first year.
The study recommends the BHB appoint its first sales and marketing director to implement the new strategy. The group has a small marketing department, but the head of marketing post is vacant.
Yet the scheme faces a Beacher’s Brook of a hurdle in the shape of the &£4.8bn betting industry. Critics say bookmakers do not plough enough money back into horseracing and accuse them of squeezing the life out of the sport.
The eight-strong Levy Board, which comprises three Government-appointed members, three BHB nominees, the Tote chairman and the chairman of the bookmakers’ committee, decides how much money bookmakers give back to horseracing.
The board ruled recently that next year the industry is to receive &£61m and that only &£1.9m of this should go on marketing. The decision creates an immediate &£11m shortfall in the first year of the BHB’s proposed strategy.
BHB chairman Peter Savill says: “Horseracing is one of the top six industries in the UK and it spends less than &£500,000 a year marketing itself. That’s equivalent to only 1.1 per cent of betting turnover. How many other industries spend so little? Overseas racing bodies plough up to 15 per cent of their turnover into marketing.”
Savill is not alone in his criticism. Michael Harris, chief executive of the Racehorse Owners’ Association, says: “The BHB scheme won’t get off the ground unless the industry can sort out the funding issue. Owners would be loathe for the money to come out of the general fund if it had an adverse affect on prize money, which is pathetic already.
“In the UK, prize money starts at about &£2,500. Overseas, it starts at anything between &£5,000 and &£10,000.”
But not everyone in the industry paints such as gloomy picture. Morag Gray, racing director of the Racecourse Owners’ Association, claims the racecourse side of the business is thriving. She says more than 5 million people will have attended race meetings by the end of this year – up from about 4.7 million in 1998. “The corporate hospitality sector is already pulling in many of the elusive ABC1s that the BHB is seeking to attract.”
While conceding that the racing industry heavily under-invests in marketing and should be doing more to attract racegoers, Gray maintains: “Most races are now sponsored and the level of sponsorship enquiries has never been higher.”
However, observers say that, while top race courses such as Ascot and Cheltenham are doing well, the majority of the 59 courses nationwide are struggling to make ends meet. “Without major marketing activity, most courses will go under,” one critic claims.
One sponsorship insider says: “Horseracing is probably the most over-sponsored sport in the world. Every race is backed by some company or other. The BHB would have to cut through the clutter to woo major brand owners.”
The industry is in an unusual position in that racecourse owners sell TV rights individually to the broadcasters – the BBC, Channel 4 and BSkyB – which makes it hard to increase the price. Some observers believe that to boost sponsorship the sport could be forced to ditch daily TV coverage. They say there is no premium to being on TV constantly.
This week it emerged that Whitbread is about to pull its sponsorship of the Whitbread Gold Cup after 43 years. The company is understood to be ending the deal – one of the longest running in British sport – to focus on specific brands.
So what are the chances of racing shedding its downmarket image and broadening its appeal to a younger, upmarket audience?
The sponsorship source says: “There is a huge split in the horseracing community. At the top end you have the wealthy owners and racegoers, at the bottom you have the tabloid readers – there is little in between.
“If it wants to move upmarket, the BHB must make racing more accessible. It will have to devise more Grand National-style ‘events’ where consumers feel some affinity to the sport.”
The insider says the industry must “demystify” racing and make it easier to understand. “It needs to move away from its reliance on betting, because that is what turns a lot of people off.
“However, it has huge potential. Racing needs to harness all that is good about the sport: its association with royalty, and the opportunity to have a great day out.”
BBC racing correspondent Clare Balding comments: “For years, I’ve been saying racing must attract a younger audience. We have got a fabulous product to promote. We must go out and sell it to the 18- to 35-year-olds.
“If you go to a race meeting abroad, most people are in their 20s. In the UK, most are in their 40s and 50s.”
She believes racing needs to distance itself from betting’s seedy image: “The industry must promote racing as a good day out, with great food and great bars.”
Balding warns that if racing doesn’t attract young consumers, in the future there will be a dearth of people wanting to become horse owners.
Harris reinforces her concerns. He says British racing is viewed as the best in the world but owners’ return on investment is the lowest of any country that runs the sport. “You simply cannot expect to make money as a racehorse owner. Most lose anything up to 80p in every &£1 they put in. Consequently, there is a huge churn rate. Nearly 25 per cent of owners drop out each year, to be replaced by new ones.”
Many observers cite how differently horseracing is perceived in the US and Australia, where there is more of a family atmosphere at meets. The BHB report shows that in the US &£9m is spent on marketing, while the Australian state of Victoria alone spends &£2m.
The Australian sector is a prime example of how British racing could attract young people, especially women. It recently launched a major TV advertising campaign featuring a group of women watching a race, cheering on their favourite horse. As the race reaches its climax, the women scream in almost orgasmic excitement as the voiceover says: “Racing… it really hits the ‘gee gee’ spot.”
This strategy might not necessarily work in the UK, but most observers agree that if racing wants to boost its profile it must change the nature of its press coverage.
M&C Saatchi Sponsorship chief executive Matthew Patten says: “Racing needs to get in the public eye and move away from the obsession with betting. It must promote the personalities in the sport – and not just Frankie Dettori and Jenny Pitman.
“Racecourses must make the sport more event-led. Aside from Cheltenham, Ascot and the Grand National, there are few horseracing events. But it’s not just a case of putting in a fun fair and providing champagne – young people have got to feel involved.”
Balding agrees: “The racing industry must promote its ‘stars’. Most national newspapers are obsessed with tipping, but they should get away from that. How many serious gamblers are going to rely on a mainstream newspaper for tips? They all go to the specialist racing press for that. Newspapers should be concentrating on the personalities in the sport.”
But without the funds to support a major nationwide marketing drive, how can the industry hope to broaden its appeal?
Ultimately, most critics agree it will be up to the betting industry to get racing out of the doldrums. One observer says: “The bookies make billions out of the sport. They must realise they can’t keep siphoning off so much money. After all, where would they be without racing?
“They will have to dig deeper to keep the industry alive.”
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