'We Need To Get In The Game': McIngvale Urges Racing To Embrace Lower Takeout, Millennials' Thirst For Sports Betting Action - Horse Racing News | Paulick Report

‘We Need To Get In The Game’: McIngvale Urges Racing To Embrace Lower Takeout, Millennials’ Thirst For Sports Betting Action

Jim McIngvale placing a wager at the Scarlet Pearl Casino’s DraftKings sportsbook in Mississippi

Jim McIngvale, aka Mattress Mack, is a legendary Houston, Texas, furniture store owner who's brought his unique brand of marketing to the Thoroughbred world. If you're not familiar with his medication-free champion sprinter Runhappy, the Claiborne Farm stallion he's been promoting the last several years, there's no point in reading any further. You're clearly from another planet.

McIngvale loves action, and when he's not making deals on the floor of his furniture store or promoting his stallion – or providing tireless charitable services to the people of Houston during times of trouble – he might be seen in legal sports books in Nevada or Mississippi making a bet. His wins and losses have made headlines, and along the way he's become intrigued with how sports betting is promoted and how popular this growing industry is with a younger crowd.

With the coronavirus (COVID-19) pandemic putting all major sports on hiatus, McIngvale is a strong believer that horse racing has an opportunity to capture many of those young people – if racing makes some necessary changes.

McIngvale shared his thoughts this week in a Q&A with the Paulick Report:

What attracts you to sports betting?
The low takeout, the action. That's what every gambler is looking for, a good gamble, to coin a phrase. When they have low takeout of 5 or 10 percent it creates buzz and creates a mass of people who want to bet on it. It feeds on itself.

I've always been a horseplayer my whole life but I started (on sports) when I did the Astros thing in 2017 I bet a whole lot of money, $13 million in Las Vegas, on the Astros to win the World Series, and it paid off. I started reading things like Bleacher Report and Action Network and started getting around those sports betting guys and seeing how young the demographic was and how excited they were about gambling. I thought to myself, “Why in the hell can't they be this excited about horse racing?”

Can racing take advantage of the growth in sports betting?
Absolutely. People want action, and just like all these tracks running now are still getting action, today for the first time ever on the Action Network's website, horse racing was the first thing you saw, information about the pick 6, the pick 5 at Tampa Bay, so that was good. Horse racing needs to take advantage of these young people who love action. Horse racing can certainly do it, but they've got to give them a chance to make money.

Lower the takeout to 5 or 10 percent. I know that's tough on the tracks, but they've got to get people betting on their own smartphone app. If they're betting on their own app, the track keeps (a bigger percentage of) the money and I think the handle will go through the roof. Now is the perfect time to do it with horse racing being front and center in the gambling world. God only knows when the other sports are going to start back up.

Why shouldn't horse racing gamble? We're asking the players to gamble, so why shouldn't horse racing gamble with a lower takeout and more promotions to attract the younger demographic?

Tracks that market to a younger crowd – when on-track attendance was permitted – have focused on the social element – “selfies” and fashion. They don't seem to be pushing them toward gambling.
The selfies and the fancy clothes, that's part and parcel of the millennial package, but they love to gamble. Some of those places that I went to when I was betting the Astros, the employees have to gamble every day with their own money. They film themselves gambling, showing the thrill of victory and the agony of defeat, or the angst of defeat as it were. Everybody in the office gambles, they're all young, and they're all making it happen. We need to get some of that vibe going in horse racing. The people who work for Action Network, Bleacher Report and other outlets, they gamble all the time. They gamble at work. Those outlets want the people writing the articles to know what gamblers are going through. That's what horse racing needs; it's all about gambling. That's where the money comes from.

The problem is, everybody like me who grew up when horse racing was the only gamble in town, are now 60 and 70 years old. The handwriting is on the wall – we're not going to be here forever. We need to go after those 20- and 30-year-old young kids with a four-day growth beard that think different, act different and interact different. They want to interact with their phone all day long and they want action all the time. Horse racing can give them that, but they want to have a chance to win and not be ground up into nothing.

How does a gray-haired marketer know what a millennial wants?
You have to think like them. Be around them and surround yourself with them. I'm not going to grow a four-day beard but I see what they're doing. These kids, their whole office is their cell phone. It's a different world. They bet there, they do everything on their cell phone. They like action. They bet on darts, they bet on all this weird stuff around the world. Why can't we get horse racing going and why can't the people who bet on horse racing be given the same advantage as those algorithm players who are getting five and 10 percent rebates?

Horse racing charges its customers for data. Should that change?
The data should be opened up. We live in a data-driven world. You listen to Donald Trump's coronavirus experts, they talk about data every day. Everything is about data. The more data we can have about the horses, the better.

We use heart rate monitors on my horses, Laura Wohlers does in Kentucky. You see what the horse is feeling, you don't have to talk to them. You can see their heartrate spikes. Why not run heart rate monitors during the races? Why not let people get all the data possible and everybody is looking at the same figures? The NFL puts out injury reports every week. What do they put it out for? They put it out for the gamblers.

The problem with racing is, we're afraid to change. It's like (Gallery Furniture). If I don't change to an online model now after brick and mortar for 40 years, I'm toast. I'm a dead man walking. This virus only speeds up the change of everybody doing everything on their cell phone. They buy everything online. It's a new world, and that's what racing has to realize. These tracks need to get apps like Xpressbet or TwinSpires has, and let people bet on their phone. Now is the time to do it, now is the time to lower the takeout and give people a better gamble.

It looks like you've rewritten the book on how to promote a stallion.
I spend as much money as anyone in horse racing on sponsorships and TV ads for Runhappy. That's another revenue source for the tracks, to sell more sponsorships – though obviously it's tougher to sell sponsorships when there's nobody in the stands. But horse racing has to think differently and they've got to get those young people, because young people crave action and horse racing provides them with action: lower the takeout, up the handle and run fewer races. Obviously you're going to have more action with a 12-horse field than you get from a four-horse field.

Are you getting a return on your marketing investment?
I spent millions on marketing Runhappy. I think almost everybody involved in racing or breeding in the United States knows of Runhappy. His book is filled, so yes, I'm getting a return on my investment. Obviously his progeny are going to have to hit the track running this year and next year for me to continue my promotion of Runhappy.

I'm a promoter at heart. That's all I've ever been and I like promoting horse racing and I like promoting to a younger market. That younger market is ready to spend money and gamble on horse racing and make money. All we've got to do is wake up, smell the roses and go after these younger people to make racing relevant again – because right now, let's face it, we ain't relevant.

The horses in our game are authentic, transparent and real. Let's be authentic and real in the way we market to young people, let them know the takeout has been lowered, it's the best bet in town, they can gamble on horse racing and make money. People want action, the sports gambling world is exploding. Horse racing is being left behind and we need to get in the game.

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