Once the country’s only legal bet, horse betting now lags behind US sports wagering and online casino gambling in overall handle.
Horseplayers spent $1.06 billion nationwide in July, a nearly 7% dip from the same month last year. According to figures released this month by Equibase, July 2023 featured 30 fewer race days compared to July 2022.
Despite horse betting‘s downward trend, several online sportsbooks recently launched horse racing apps during slower summer sports betting months.
LSR spent time at Saratoga this month with Johnny Avello, director of race and sportsbook operations at DraftKings, to get his thoughts on the early returns for the DK Horse app, where horse racing is headed, and how the younger generation might help keep the sport afloat.
LSR: What opportunity did DraftKings see at Saratoga this summer?
Avello: For all of us involved in DraftKings racing, we know Saratoga is a popular place. Horseplayers, and casual fans, come and bet.
We thought this was an excellent place to invest that money. So far, it has worked out well.
LSR: Is there data showing sports bettors are turning into horseplayers?
Avello: For Saratoga, we see good action on the app daily. Triple Crown races handle the best money, but we have seen a steady flow of players since Saratoga opened.
They are crossover players, too. That is why we got into the business. Our sports bettors had to go somewhere to get racing since we did not offer the product then. They did not want to leave, but I think we have gathered them back again.
LSR: How do you view DK Horse alongside DraftKings other options?
Avello: If you are going to be in the entertainment industry like DraftKings is, you need to have all verticals working for you, not so much from the revenue perspective, just as an offering for the customers.
Is horse racing going to do the numbers that sports betting does? No, it is not, but it needs to be in the mix. It needs to be around for the significant horse betting events, but you must also have it daily for people who enjoy playing horses.
I would never compare it to sports betting, I never have. It needs to be part of the overall entertainment mix. The goal is to offer entertainment for 12 to 14 hours per day. Our app will give you that action if you are looking for horse betting.
LSR: Do you see DK Horse as a way for DraftKings to create brand awareness in states like Florida?
Avello: That is not the way we are looking at it.
We see it as getting into a state where horse racing is popular so we can offer our product. The game plan is to be in states where people are horseplayers and want to be betting horse racing.
In some states, sports betting is not legal, but daily fantasy sports is legal. Some of those states also have horse racing.
Now we can offer our customers a horse betting option where they are already playing other things.
LSR: Is the lack of new technology in horse betting a hurdle for DraftKings and the racing industry?
Avello: We are a tech company. DK Horse is in its infancy. We will bring things to horse racing that have not been done before. I am confident it is going to be a game-changer.
We do not want just to offer horse betting, we want to do it right. DraftKings has been known to shake things up a bit, improve it, and make it better. That will always be our goal.
LSR: How have you seen the racing game evolve over the years?
Avello: Some players have been betting horses for a very long time. When those players die off or stop betting, how do you get the new generation involved? That’s where we believe we can make some changes.
Taking a sports game and picking Team A or Team B is easy. It is one or the other. In horse racing, you must make a case for why you prefer one over the other when it is eight or 10 different horses. We must figure out how to get some younger people into the game.
Our handle in Nevada was big at one time, and it has slowly declined. There are places, like Saratoga, every year that keep their handle up, they do not lose much traction. I do not know exactly what the path is for DK Horse, I just know it looks positive early.
LSR: Do you believe fixed odds will be a saving grace for horse betting?
Avello: We want to be a major part of fixed-odds horse racing. Right now, you have New Jersey, one state doing it. You have Colorado, which is close. You have Iowa working on it. Until you have everyone working together and states adopt it, we are nowhere.
The price you bet is the price you get, that is just one aspect of it. There are so many things I used to do when I was in Vegas.
Matchups, head-to-head, will make the younger generation come closer because they are used to it. Which jockey will win the most races during Saratoga, future books for different Triple Crown races, the Travers Stakes, the Breeders’ Cup. Those are all things that will help the game. We are just not getting there right now.
We need the tracks to be open to that. They might be afraid those bets will take away from their handle. It is not, it is going to help with their handle. As soon as everybody can understand that, it will help the game.
LSR: Where do you see horse racing in the sports betting landscape in the next 5-10 years?
Avello: To be truthful, we will probably see fewer tracks. I am OK with that as long as it is quality racing. We do not need to have as many tracks as we have now.
We are offering Hong Kong racing and European racing. I hope to see international racing stick around, but I also see where this is going.
There will only be a certain number of tracks running for a certain amount of time.
