Name:

Student No.:

Module Title: Marketing Management– 2010/11

Module No.: BMO6505

Word Count: 2714 (excluding tables) Introduction:

Thoroughbred horse racing is a significant sport for audience in Australia, deemed to be part of their culture, alongside betting on horse racing becoming an admired pastime. Just to form an idea of the intensity of gambling on horse racing, AUS$ 24.3 billion was wagered in the year 2009-10 with Totalisator Agency Board (TAB) and Bookmakers, showing the audience interest in wagering (australian racing fact book - arf, 2010). The two kinds of thoroughbred racing that takes place in Australia are races over hurdles or fences and flat racing in South Australia and .

Thoroughbred racing has become the third most attended audience sport in Australia, just falling behind the rugby league and rules football, with approximately 2 million entries to 360 registered race courses in 2009-10 all across Australia (arf, 2010).

But in recent years, several studies have indicated that the Australian nation is losing interest thoroughbred horse racing, simply because of the complexity of the rules and procedures of race and wagering, and due to the lack of interactivity between the audience and the sport.

This report aims to present a comprehensive analysis of the thoroughbred racing industry in Australia and the current role of Victorian Racing Limited in it. Then after conducting an inclusive situation analysis, the report will present ways as to how Racing Victoria can increase participation and fan base by developing advocates for racing.

Executive Summary:

• AUS$ 24.3 billion was wagered in the year 2009-10 on horse racing via Totalisator Agency Board (TAB) and Bookmakers. • Thoroughbred racing is the third most attended audience sport in Australia. • Australia has the most race courses in the world and it is on the third position globally in terms of the prize money that is given away annually. • The horse racing industry in Australia provides part-time or full-time employment to almost 250,000 people, which is an equivalent to 77,000 jobs. • Australia has got 14 major clubs out of the total of 374 clubs. • NSW has conducted the most races and race meetings in the last 10 years amongst all states. • In the year 2009/10, NSW has contributed the most in thoroughbred wagering turnover in Australia, 25.54% of the total turnover.

Industry Analysis:

Racing in Australia

The Australian Racing Board is responsible for administering the racing in Australia; with each state’s main racing authority is in accordance to conform to impose the Australian Rules of Racing.

A part from being a popular audience sport, the horse racing industry also provides part-time or full-time employment to almost 250,000 people, which is an equivalent to 77,000 jobs. In addition, almost 300,000 individuals have direct stake as members of syndicate or individual owners that owns the 30,000 horses in training in Australia (arf, 2010).

Important Races

Audience’s interest has been mounting up recently in thoroughbred racing, particularly in autumn racing carnivals and main spring, with more than 100,000 appealed to the Victoria Derby, VRC Oaks race meets and the Cup. Other major attractions are the , W S Cox Plate and Golden Slipper Stakes (Australian racing board, 2011).

Administration of Racing in Australia

The Australian Racing Board (ARB) is accountable for the supervision of racing in the continent of Australia and the body is beyond the supremacy of all clubs, which was used to be independent bodies of racing before for their respective states until the new government reforms introduced a separate governing body of the industry. The (ARB) is directly liable for; the maintenance and establishment of the pattern racing committees; allocating black type status; and establishing racing rules. It is also responsible for making an acknowledged calendar for racing and to establish advisory groups to endeavor to preserve harmony in procedures amongst states (Racing Victoria, 2011).

Victoria Victoria is deemed to be the home of horse racing in Australia with international races such as and the governing body for the state is Racing Victoria Limited. The main club is the Victoria Racing Club which races at Flemington, alongside other metropolitan clubs Moonee Valley Racing Club, which is home for Cox Plate - the weight for age championship for Australasia, and the Melbourne Racing Club which races at Sandown and Caulfield. The state swanks several top class country and provincial race courses which entail, Mornington, Ballarat, Stony Creek etc (arf, 2011).

Betting

In Australia, there are four major paths for race betting. Firstly, there are licensed on track bookmakers that present fixed odds betting, typically on places and wins. Then there is Off-track betting, traditionally controlled by “Totalisator Agency Boards” (TAB) that presented pari-mutuel betting – i.e. the odds are not fixed but entailed ‘the house’ taking a fixed cut and giving away the remainder to people won the bet.

In some regions of Australia there was a custom of illegal off-course bookmaking, known as SP bookmaking, which historically involved large turnover; still it is uncertain whether it still prevails. Lastly, there is exchange betting – online person to person betting - where members set their own prices and pay in commission a percentage of their winnings (arf, 2011).

Major Race Clubs

Australia has got 14 major clubs out of the total of 374 clubs. All clubs arrange metropolitan meetings almost on a weekly basis. The list of the major race clubs and their territories are given below:

State Club(s) Race track(s) Victoria Victoria Racing Club Flemington, Caulfield, Sandown Melbourne Racing Club

Queensland Sydney Turf Club Rosehill, Canterbury, Doomben, Eagle Farm Brisbane Racing Club Gold Coast Gold Coast Turf Club

New South Wales Moonee Valley Race Club Moonee Valley, Randwick, Warwick Farm Australian Jockey Club

South Australia South Australian Jockey Club Morphettville

West Australia Western Australian Turf Club Belmont Park, Ascot

Tasmania Tasmanian Racing Club Hobart (Elwick) Tasmanian Turf Club Launceston (Mowbray) ACT Canberra Racing Club Canberra

North Territory Darwin Turf Club Fannie Bay

Table 1: Source – (Arf, 2011)

Comparison of the number of races and race meetings amongst states

It can be seen from the given below tables that in terms of race meetings and races that have taken place in the last 10 years, New South Wales (NSW), Victoria (VIC) and Queensland (QSW) have done better, providing more entertainment to the residents of it’s state and the horse racing audience in general. But the race meetings have declined slightly for Victoria and Queensland over the past few years. Table 2: Source (arf, 2011)

Table 3: Source (arf, 2011)

Thoroughbred Wagering

The given below table shows the comparison of percentage of thoroughbred wagering turnover amongst states in Australia. In the year 2009-10, New South Wales and Victoria have contributed the most in the total Australian Thoroughbred Turnover, which shows the increased interest of its’ residents in wagering.

Table 4: Source (arf, 2011) Viewer Profile of thoroughbred racing in general

Variables Description Sex Male, Female Age 18-70 Profession Business Professionals, Farm Manager; Workers, Sports Fanatics, Trainers, Breeders, Veterinarian, Bloodstock Agent etc Benefits Sought Adventure, Thrill Dominance, Passion, Pleasure, Time Pass, Victory

Table 5

Decline in the interest of thoroughbred racing

In the wake of major entertainment and sports competition, the core fervent fan base for racing is declining. Racing was situated in 19th place for fanatical passion in a survey which assessed passion for all kinds of entertainment. Only 14% of those surveyed rated racing with a score of 4 or 5 out of 5.

Figure 1: (Laing, 2011)

When assessed only against other sports, racing rates ninth for general interest (25%) with 11% of correspondents deemed as fanatics and 14% rated as fans. Figure 2: (Laing, 2011)

Horse Racing brand is currently driven by the underlying brands of wagering operators, clubs and events (SRC, Melbourne Cup, Caulfield Cup, and Cox Plate). In the given below chart, when research compared Horse Racing to other sports revealed some important points:

• More people agreed Horse Racing was a “sport losing its relevance” than any other sport. • Often contradictory brand images probably due to the various events or sub-brands. Figure 3: (Laing, 2011)

Situation Analysis for Racing Victoria:

Product Offering

Racing Victoria Limited (RVL) is the main authority responsible for administering thoroughbred racing in the state of Victoria, Australia. RVL was developed with the assistance of racing industry bodies, racing clubs and the State Government to offer sovereign supervision of thoroughbred racing in the state of Victoria.

Its’ vision is to improve the Victorian thoroughbred racing industry’s stature as a foremost world class sports industry offering quality, integrity and entertainment. Its aim is to:

• Offer Best Practice

• Strengthen economic performance

• Influence prospects afar Victoria and

• Value the community, people and wellbeing of the horse (Racing Victoria, 2011). Constitutional Goals

The constitutional goals for RVL are to motivate, develop, administer and endorse the demeanor of racing of thoroughbred horses in Victoria by certifying:

• Superiority: Victorian thoroughbred racing is renowned worldwide and throughout Australia as the best in racing excellence. • Customer Services. • Economic benefits: RVL's management and Victorian thoroughbred racing clubs' costs, revenues, liabilities and assets utilizes the economic benefits capitulated by Victorian thoroughbred racing to all participants and stakeholders. • Social Responsibilities: Victorian thoroughbred racing endeavors to meets its social duties to Victoria and the community in which it operates by: 1) Promoting Victoria via thoroughbred industry 2) Motivating responsible gaming and wagering 3) Creating employment opportunities via thoroughbred industry.

• Providing breathtaking 50 days of top class racing action which entail:

1) Melbourne's . 2) Tatts Cox Plate (2040m) at Moonee Valley. 3) Emirates Melbourne Cup (3200m) at Flemington (Arf, 2011).

Events for the promotion and celebration of the racing industry

• ‘Victorian thoroughbred Racing Awards 2011’ at crown palladium.