Industry data indicates that the regrowth strategy employed by horseracing's top leaders is continuing to fail in the area of worthy results. The industry remains headed for an eventual demise without a powerful transformation makeover.

Horseracing Business reported some startling analysis

"United States pari-mutuel handle in 2012 was 13.4% greater than it was in 1993, when compared in nominal   dollars. However, in real dollars (inflation-adjusted with 1993 as the base year), pari-mutuel handle declined by 27.6% in the 20-year period between 1993 and 2012."

In 1993, pari-mutuel handle was 9.6 billion annually but in terms of inflation-adjusted dollars, was only 6.95 billion 19-years later, they reported. 

"This trend is ominous when viewed in nominal dollars and starkly worse when the nominal dollars are adjusted to 1993 dollars... the main cause... is a noncompetitive takeout rate that destroys demand among large-scale bettors. The key question is whether the traditional pari-mutuel business model can yield a profit at takeout rates in line with sports betting in particular."

The Jockey Club® has yet to report the industry's pari-mutuel handle for 2013 (as of Jan 25, 2014).

Much of the industry's nail biting has been in the hopes that recommendations from the McKinsey and Company turned into viable projects would bear fruit for the industry. However, Creatorans™, another consulting group specializing in "big picture" consulting who prepared the Project Metamorphosis study predicted virtually all of McKinsey's recommendations would ultimately fail to significantly turn the industry around. Their prediction was based on two aspects. One, that the Creatorans™ study indicated a far deeper set of interrelated problems including cultural biasing aspects that McKinsey failed to recognize in its study findings. Two, that the McKinsey solution proposals did not address those foundational problems but instead focused on traditional consulting solutions that were not appropriate to the key findings.

One major aspect in the Creatorans™ study also revealed that horseracing had failed to properly manage and control its over-all image on a variety of levels and that it was having a powerful negative impact on consumers. As an example, company officials noted that a recent progress report indicated the industry was depending on third party production companies to independently create new TV content focused on the industry as opposed to assuming control of the entire process through a nationally coordinated image control system (as had been proposed in a later solution report by the group that the industry had ignored).

"Had the industry headed our warnings, they would have learned that one of the worst things they could do was encourage others to create a reality TV show about horseracing," said a company spokesperson. "They are only compounding their problems with a complete disregard of the key problems and core solutions dealing with image control and cultural biasing repairs,"  they said. 

Creatorans™ was referring to the reality TV shows reported in the Oct 25, 2013 Building Sustainable Growth put out by The Jockey Club®. They said Project Metamorphosis Report 1 specifically warned against the use of such realty TV programming toward boosting growth because it would, in nearly all cases, result in adding further tarnish to the industry's image with consumers. The Creatorans™ report cited the recent HBO series "Luck" as another prime example of "what not to do" when it came to media programming. That show had the potential of becoming an albatross and horseracing dodged a bullet when it was canceled, they reported.

What is clear so far is that horseracing has pinned all its hopes on McKinsey and Company and that company's solutions have failed to deliver significant results yet. Creatorans™ has predicted that the over-all revenues could temporarily uptick for 2013 but that by 2015 they should begin to dramatically plummet as shown by the trending models. In the Project Metamorphosis Executive Summary (that was partially released by the company), the industry is predicted to drop to $7.1 billion in annual revenues over the next decade and to be all but gone within 2-decades. Needless to say the picture is not rosy and neither are the issues and remedies so simple. 

"We know that the takeout rate is a contributing factor to the demise of the horseracing industry, but we respectfully disagree with Horseracing Business's analysis that it is the primary cause of the industry's fall," said  a spokesperson for Creatorans™. "There are a great many downfall contributors and we list the top one as a lack of industry centralization and managerial control as well as leadership failures--the collective lack of vision and willingness to get highly industrious is astounding on its own," they said. "This industry is a $30 billion annual money maker in 10-years if horseracing can re-organize and upgrade to the 21st Century," they said. "However, using traditional solutions that fail to address the major underlying issues will only exasperate the problems," they said.

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