Why Gulfstream worked

Anyone who might have been introduced to horse racing Saturday at Gulfstream Park never would have imagined that the sport is in trouble. The handle for the day was $13,088,424, some $3.5 million of it coming from a bet called the Rainbow Six that had horseplayers throughout North America giddy with excitement as they chased after what they hoped would be a life-changing score. Saturday was the highlight of a terrific closing weekend of what was a terrific meet.

Gulfstream has yet to provide the media with 2011 all-sources handle figures, but all indications are that they are up substantially over 2010. According to one report, handle was up by $40 million entering the final weekend, some of which had to do with a wildly successful Florida Derby weekend. Gulfstream moved the big race to a Sunday, spiced up the prior day’s card and handled $36 million over the two days

Gulfstream owner Frank Stronach fires racetrack executives like George Steinbrenner used to axe his managers. He’s run through a dozen or so top executives since he took over Gulfstream, along the way chasing a lot of competent people out of town. But even Stronach couldn’t possibly fire the pair he had running the place in 2011, Steve Calabro and former trainer Tim Ritvo. Not after what they pulled off this year.

All Calabro and Ritvo did was run the meet the way any smart businessman would run any business, using common sense strategies that are amazingly hard to find in horse racing. They understood that the key to any good business is to offer a good product at fair prices. It works in the restaurant business, the widget business, the horse racing business, any business.

I have written this before, but it bears repeating. People don’t dislike horse racing and they are not turning away from it when it is presented right. They dislike bad horse racing and they particularly dislike it when they are getting ripped off. Serve bad, over-priced food and your restaurant will soon go out of business. Serve bad racing with exorbitant takeout rates and … you get the idea.

In the winter months, no racetrack in America offers a better racing product than Gulfstream Park does.

In some respects, Calabro, Ritvo and racing secretary Dan Bork have the easiest job in racing. Luring horses to run in the winter in Florida for decent purses is not exactly difficult. But the trio, dealt a good hand, played it perfectly. Day in and day out, Gulfstream offered full, competitive fields. Even after the Florida Derby, when the meet usually fizzles out, they kept it chugging along. Rainbow Six players were asked to deal with one brainteaser after another on the final Saturday of the meet — a lot of wide-open races with no overwhelming favorites.

Still, it has to be priced right. The takeout at every racetrack in America is still way, way too high, but at least Calabro and his team made efforts to move in the right direction. Prior to opening day, they announced that the meet would include a 50-cent Pick with a 15 percent takeout and that the takeout on the Pick Three and Pick Four would be 20 percent. The Pick Five, in particular, was a big hit. As was the Rainbow Six, where the entire pool was paid out only when one person held the winning ticket. A Rainbow Six ticket cost just a dime, another reason why it was so popular.

“We’re optimistic and excited about the new wagers we’re introducing and the fact Gulfstream will be offering many of the lowest takeouts in the country,” Calabro, the president and GM of Gulfstream Park, said, prior to the meet. “We think the Pick-5, Pick-4′s and 10 cent Pick-6 creates more opportunities for our fans.”

Sometimes it’s just too easy picking on California, but they got what they deserved when they raised the takeout and then continued to serve up a steady diet of six-horse fields. Anyone, except the people at the California Horse Racing Board, could have told you that the Santa Anita meet, the first run under the onerous takeout structure, would be a disaster.

Horse racing, thanks to Gulfstream and Santa Anita, has a blueprint for how and how not to succeed staring it in the face. Good racing, full fields. Low takeouts. It’s very simple. It’s not the least bit coincidental that the other big success story in the sport this year was Tampa Bay Downs, also a winter track in Florida that also offers full fields and also lowered some of its takeouts before the meet began.

Unfortunately, getting other tracks to change and be more like Gulfstream and Tampa is another story.

There just aren’t enough horses, especially good horses, to fill cards when there is such a glut of racing. Drastically reducing the number of racetracks and racing dates out there is the obvious answer, but powerful horsemen’s groups don’t want to see that happen. The other problem is slot machines. Take them out of the equation and a dozen or so tracks now running would be out of business, making the remaining tracks stronger. While everyone would love to see dozens of tracks operating and thriving every day, having so many tracks running at once is not a sustainable business model anymore and only dilutes the product everywhere.

And getting tracks to take less from the bettors when they are struggling as it is when it comes to the bottom line might sound good and is the right thing to do, but getting it done is another thing.

So horse racing will continue to limp along, with nationwide handle declining month after month and fewer horses being bred each year, which will only make fields smaller and the gambling game less appealing.

Oh, well, at least we have Gulfstream.

Originally Posted on ESPN