As Horse Racing Fades, Del Mar Bucks the Trend

Shorter. Younger. More diverse.

These are some of the brief but widespread recommendations that people throughout the horseracing industry have made to save the Sport of Kings from going the way of boxing (before that sport became almost exclusively a Pay-Per-View phenomenon rather than a must-attend).

Yes, thoroughbred racing still has its Triple Crown jewels that attract a lot of eyeballs even as they fail to field a horse that can win all three legs. But a better model for the sport’s survival into the future can be found in the summertime gem where, famously, the Turf Meets the Surf.

Courtesy: Del Mar Thoroughbred Club

Courtesy: Del Mar Thoroughbred Club

As the Del Mar Thoroughbred Club prepares to hold the signature event of its short summer season, this Sunday’s $1 million Pacific Classic, chief executive Joe Harper and his staff can take pride in their meet’s status as a global destination for race fans, and that they remain one of the few business success stories in the industry today.

The success of Del Mar’s seven-week season also puts the venue in a prime position to inherit the fall meet from Hollywood Park as that Los Angeles-area track closes. In turn, hosting a fall meet beginning in 2014 will put Del Mar in a prime position to host the Breeders’ Cup, a far more significant event for the industry than the more commercial Kentucky Derby.

While Del Mar’s Opening Day attendance this July was down about 8% from last year’s big-hatted extravaganza—deliberately, according to Harper, to allow for sharper crowd control and a better fan experience at San Diego’s signature social event of the year—2013 attendance, handle, and food and beverage sales are up, even from last summer’s most successful season ever.

The 2012 meet, the track’s 75th anniversary year, featured large purses, full fields, daily crowds averaging 17,623 race fans, and an all-sources handle that rose by close to 9%, to $468,093,477, bucking industry trends. Add that to the strongest sponsorship portfolio in horse racing—including such partners as Toyota, Coors Light, Pepsi, Jack in the Box, BCBG, Wyndam Hotels, American Airlines, and Jack Daniels—and it’s easy to see why the Del Mar Thoroughbred Club has a business model other tracks should surely emulate.

Del Mar Thoroughbred Club

Courtesy: Del Mar Thoroughbred Club

This Sunday’s TVG Pacific Classic, Del Mar’s signature event and the West Coast’s only million-dollar purse, further ups the venue’s prestige through its star studded field. Among the 13 horses entered into the race are Derby darling Game On Dude, seeking to become only the second horse to win California’s three biggest races—the Santa Anita Handicap, Hollywood Gold Cup, and Pacific Classic—in the same year; defending race champion Dullahan, with career earnings of more than $1.7 million; and English champion Farraaj, who traveled 5,400 miles to compete.

Adding to Del Mar’s success story and widening demographic is its ever-growing Summer Concert Series, which in 2013 has featured the likes of the B-52s, Sammy Hagar, and Ziggy Marley, Latin artists Larry Hernandez and Los Tucanes de Tijuana, and indie favorites Weezer and Fitz and the Tantrums. The track also hosts a popular craft beer fest, and infield activities aimed at families are practically nonstop. Providing this variety of entertainment is key to why Del Mar is now attracting the next generation of race fans, as well as a growing Hispanic following, with 3-5% of the track attendees crossing the nearby Mexican border to attend.

Concerts and brew fests bring younger fans through the gate, but more needs to be done to keep them there—and get them hooked on horse racing in the process. If no one is betting on races 20 years from now, sideline revenue streams won’t matter.

That’s why the Jockey Club has put together a group called America’s Best Racing, which is also endorsed by the Breeders’ Cup. Led by Brand Ambassador Chip McGaughey, son of Shug McGaughey, the trainer of Kentucky Derby winner Orb, the group is seeking to impact the next generation of racing fans through a combination of on-site events and social media.

“That’s the way a lot of the sports have been going now, engaging fans through social media, and we’re trying to use that to keep everyone together and drum up excitement about things in some of the non-traditional media,” Chip McGaughey told the Asbury Park Press last month, following an event the group had put on at Monmouth Park.

All told, the group was planning handicapping events and awareness campaigns at tracks from Gulfstream in Florida to Kentucky’s Keeneland, Arlington in Chicago, and the West Coast.

“We’re really showing off the lifestyle and social aspects of racing, as opposed to just gambling,” added McGauhey. “We’re going to teach them how to wager. But we want to show them what a good time it is.”
Back in Del Mar, Harper and his staff are looking forward to 2014, when their good time track will add a short fall meet during the month of November, and mount its Breeders’ Cup campaign in earnest.

Harper knows his beautiful facility, with its chic Turf Club, lively infield, expansive barns, and additional infrastructure provided by the surrounding Del Mar Fairgrounds, pretty much speaks for itself—especially after its turf course is widened to accommodate 14 horses, a Breeders’ Cup must. So, many of his conversations with Breeders’ Cup brass have centered on the regional market.

“When you fly into Los Angeles for a Breeders’ Cup at Santa Anita,” Harper says, “you won’t see any posters advertising the event. You’re competing with USC football and the NBA. Here, you will be the biggest show in town.”

The San Diego region contains more than 50,000 hotels rooms, 30,000 of them, as Harper noted, within a 15 minute drive of Del Mar. And San Diego is and will remain a worldwide destination. “We are so successful because of the market we are in,” Harper concludes.
If Harper is successful in landing the Breeders’ Cup, all of San Diego will share in that triumph as well.

According to a study by the Los Angeles County Economic Development Corporation, Breeders’ Cup events at Santa Anita generate in excess of $60 million in economic impact in the region. With the attractiveness of the San Diego market, the financial impact in that region could be significantly higher.

At Del Mar, the surf’s up, and so is the economic tide.

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