Much improved signs heading into Entain Year-2
by Brian de Lore
Published 25 June 2024
Free-to-air Trackside and aggressive marketing have Entain Managing Director Cameron Rodger smiling broadly after receiving the latest betting figures.
A few days ago, he told me, “We are just now in the process of measuring what the move to Free to Air has done to overall trackside audience numbers. This data is still being finalised but to give you a sense of the result – our total Trackside audience on Saturdays is up more than 25% – and the total viewership over the week is up even more.”
Cameron added: “It’s more brutal out there than probably anyone could have accurately pictured, not just the betting market but all consumer markets, but what I’m seeing is upside through engaging more customers – we have so many more customers on our books now compared to last year. But we are getting less out of each customer than we had hoped because there is less money in everyone’s pockets.
“Through our investment here, we have managed to fill the funnel at a fast rate, so we have had a 21 percent increase in customers, which delivers to us a turnover that’s not in decline. And that increase came after only 17 days of testing from marketing the new app, so that’s tracking really positively. If we had the same customer base we started with, we would be in serious trouble.”
The economic downturn may be worldwide, but it is reportedly worse in New Zealand than in Australia. So why is post-COVID betting in Australia estimated to have a 15—to 20 percent downturn, but against that trend, turnover has increased in NZ over the past year?
Entain men have a passion for racing
The simple one-word answer is Entain. The newbies have introduced a fresh change of direction and taken control of the decision-making at TAB NZ, thus eliminating the non-performing, apathetic administration of the past with an injection of new life. Dean Shannon, Lachlan Fitt, and Cameron Rodger are intelligent people who all have a passion for horse racing, a vital but missing ingredient in most of their predecessors over the previous 20 years.
Entain’s partnership with TAB NZ can only be described as ‘game-changing.’ Cameron Rodger doesn’t entirely agree with my assessment that TAB NZ would now be broke. He says: “If the new distributions hadn’t gone through, distributions to the codes would probably have been cut by about $20 million.”
Applying that to the thoroughbred industry, the available prizemoney would be 36 percent less than the current level, accompanied by an exodus of the industry comparable to the annual Hajj to Mecca.
Cameron Rodger is buoyed by the most recent stats coming to him after a year of placing racing in front of the general public by embracing mainstream media. He elaborated:
“Thoroughbred racing in May was up 28 per cent in turnover on the previous year, which is a huge leap forward, and harness was up 15 per cent, and Greyhounds was up eight per cent, and that’s just May. Total active customers in May 2024, was 82,500 against 72,000 the previous May, so we are genuinely thrilled with what we are seeing.
June new customers up 15%
“As an example, for the month of June thus far, we’ve had two-and-a-half times more account sign-ups than we had in the same period last year. That number is exceeding even our own new customer number forecasts – by just under 15%.
“It tells us that the different initiatives we’ve put in place are doing a great job of getting customers in the door which is the critical measure we are chasing, and is especially gratifying this early on.”
No one will deny that Entain has made a great effort in year one, but what about sustainability? The first year has passed with a positive pass mark, but everyone with an investment in racing is interested in the long term with consistent growth which will encourage new participants. I put that question to Cameron:
“We have a five-year window for a reason, we are not going to be going backwards. If people can see that we are trying our best to find a solution to issues that are not really our issues to solve, hopefully, it shows how serious we are about New Zealand’s future for the long term.
“We don’t even have to worry about the turnover right now because we are here for the long haul. I’m not just putting on a brave face, there are genuinely very good signs despite the tough, tough market.
Riding out the economic downturn
“Without the economic downturn, we would be really flying along. The upshot of this is that we can ride out the cycle now, and distributions won’t be affected. We can keep investing and growing customer numbers. When the economy comes back, we have a great customer base to grow again.
“We are up 3.5 percent year-on-year in turnover and gross profit is also up slightly.
“Other jurisdictions are down, and we are putting up a helluva fight. It’s genuinely showing us that if we can get these numbers up further, it’s very positive for the future. The best thing we can do at this time is not to try to get more money out of our customers in this economic climate.”
When I suggested to Cameron that the problems confronting the breeding industry are just as serious as racing with a historically declining stallion, broodmare and foal population, he responded this way: “We are aware of the problems facing the breeding industry.
“The top end seems to look after itself, but there has been a weakening of the middle and bottom end. We are trying to get involved through the Pearl Series. We have looked at the decline of the broodmare band, which can’t be ignored; if you look at the number of stakes-winning mares and progeny going through the sales, it’s on the decline, and good broodmares are getting harder and harder to buy.
“Prizemoney increases still catching up” – Cameron Rodger
“We do know that increased prizemoney makes a difference over time, but we are trying to think of tactical ways we can engage the breeding and racing industry. I don’t really think that the full upside of the prizemoney injections has yet caught up to all areas of the industry.
“I think the time to be investing in the industry is in a downturn, and I know that’s an easy thing to say, and everyone knows that principle, but it’s just a hard thing to do in real terms. The amazing positive we have right now is that we are one of the few sectors where, despite the inflationary pressure, the underlying picture is improving. I do believe that things will improve within a couple of years, but it might be a more extended period of pain than most people thought.
I said to Cameron Rodger that we are an apathetic industry with a poor record of helping ourselves and now we are relying on Entain. He replied: “We are not pretending we have a silver bullet.
Cameron Rodger: “Lachlan Fitt is a machine; he doesn’t stop”
“Lachlan Fitt has been appointed Chairman of the board of Thoroughbred Marketing (NZTM),” he continued. “You won’t find a more passionate foreigner when it comes to the New Zealand industry – he loves it and is a machine; he doesn’t stop. He’s never satisfied and he’s the one that’s driving things here, but we haven’t worked out all the equations yet.
The Entain executives have all pledged their allegiance to racing over sport, which is music to the ears of racing, but he did finish the chat by revealing an interesting stat, which comes as a result of advertising on mainstream media:
“The turnover on the Warriors has gone from about $400,000 to $620,000 per match involved, so it is about a 50 percent increase.”