02/05/2014 6:12PM

Keith Gisser: Racino model works better when in sync

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It’s almost as if Northfield Park executives read my column. Less than 36 hours after my article was posted saying they were “going backwards,” they made a huge announcement of an anticipated $500,000 race, the Carl Milstein Memorial. And then, a week or so ago, they announced a 30% purse increase after finally getting out from under years of overpayments.

Let’s be clear, this is an honor Carl deserves. For those who are too young (since it was the days before simulcasting was so big), Carl Milstein was the Jeff Gural of his day. He was a tough negotiator, a creative thinker and a big spender when it was appropriate. Carl was THAT smart of an operator. This race fills a good spot on the stakes calendar and could be a huge event. How important is Carl’s legacy to the racetrack? Go to www.carlmilstein.com and see where it redirects.

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Many folks, especially horsemen, complained about this race. Northfield is adding $250,000 to the purse. Why not put that quarter of a million into overnight events? Simple. It would have meant little. Doing the math of 214 nights of live racing times 14 races (on average) and dividing it by $250,000 equals about $83 per race. It is not enough to affect the overnight purses (which had seen three 10% jumps in recent months already). That $83 per race is less than a 5% hike. So kudos for Northfield on looking to make a splash and even more kudos for honoring a guy who I have the utmost respect for, even if he was on the downside of his life journey when I began working there.

So instead of $83 per race, Northfield bumped up the condition sheet to offer $7-10,000 Opens and a bottom purse of $2,000 (although that bottom class is a sub class and the usual bottom is now $2,600).  Derick Giwner detailed the Ohio situation quite well right here last week in his discussion of the resurgence of Ohio racing. (www.drf.com/blogs/harness-racing-ohio-ready-resurgence).

Frankly, Northfield Park had no choice but to raise it purses by 30% with the other tracks opening in a couple months. While the entry box is full right now, it is due to lack of competition. Once the other tracks open, they will draw horses and horsemen and without the increase Northfield would be hurting.

The Rocksino has been highly successful in its first few months. In fact Yogi Berra told me, “Nobody goes there anymore; it’s too crowded.” It remains to be seen if it will continue to sustain this level of business, subsidizing the purse payout. So perhaps Northfield should reach out to those potential new customers and promote, especially cross-promoting with its slots parlor.

I spoke with horse owner Scott Rhoades, who is trying to organize a cooperative promotional effort between horsemen and management (the initiative is in its nascent stages, but would be similar to what the MSOA does at The Meadows in Pennsylvania). Rhoades got back into harness racing last year, when he saw the potential for a profitable experience. He currently owns two horses. As a successful small business owner (electrical supply and real estate) he brings business and promotion acumen to the table. As a kid who grew up in Delaware, Ohio and whose grandpa was friends with Curly Smart (co-founder of the Little Brown Jug), he brings a passion for harness racing to the table.

Rhoades’ initial email exchange with Rocksino management on cross promotion between the casino and racetrack was met with some resistance.

“I thought it was horrible,” Rhoades commented on the response. “But anyone can complain.  I am trying to do something about it. The property as a whole can be a destination. The track and the Rocksino are stronger together than they are apart.”

The e-mail also created an uproar among horsemen on a Facebook page Rhoades hosts. And it seems that uproar caught the Northfield management team’s attention. As a result, Rhoades has been invited to a marketing meeting this week at which he will present a number of marketing and promotional ideas submitted by horsemen, based on successful promotions they have seen enacted at other tracks.

For nearly 10 years, Northfield has focused promotions on its core customers, regularly dropping occasional customers from its mailing list and special offers. This is a highly efficient use of what has been a limited promotional budget, but it is a promotional model that is outdated with the opening of the Rocksino. In order to generate enough of a wagering base to sustain purses, Northfield must begin catering to new customers, and it has a captive group just a couple hundred yards away.

Rhoades points out another missed opportunity. “At Thistledown (just eight miles up the road) they broadcast racing into the bars. At the Rocksino, I saw nothing that told me there was racing going on.”

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Rhoades hopes to change the separate, but not equal concept at Northfield and he is hopeful. He is also quick to compliment Northfield management on its responsiveness, even if there has not yet been a lot of action.

“They have always answered my e-mails,” he says. “And I can understand not wanting to do a lot of promotion in the cold weather. The casual race fan doesn’t want to deal with that. (General Manager) Brent Reitz has been very helpful. He always returns my calls.”

Here’s one pundit who hopes Rhoades gets a fair hearing and Northfield returns to its place as an industry leader in catering to the customer, just the way Carl Milstein would have insisted if he were still with us. Now go cash. See you next month.