Will on-course bookmakers still be around in 10 years’ time? In our opinion, we should all sincerely hope so. The bagmen have always been part and parcel of horse racing as we know it. They are as old as the industry itself. On-course bookmakers, particularly in terms of the 'racecourse experience' without a doubt contribute a high degree of atmosphere and excitement to racetracks both large and small. The brightly coloured umbrellas, the LED boards, and the shouting of the odds are an integral part of enjoying a day out at the races for most punters and horse racing fans everywhere.
However, there is a serious question mark looming over the viability of on-course bookmakers. Particularly at the smaller mid-week meetings. The threat comes from at least three different directions. The first one being the inexorable march of the online, internet betting sites since the turn of the century. Secondly, from the betting exchanges, and thirdly, a relatively more recent move to a ‘cashless society’ which was turbocharged and aggressively driven by the COVID-19 pandemic a few years ago. Each is separate issue, but when it comes to the future, or lack thereof, for the traditional on-course bookmakers' they are not mutually exclusive to each other. These issues are discussed and explored below:
Online / Internet Betting: The biggest thing here is the absolute and total convenience of being able to place a bet at literally, any time of the day from any location that you may be at. There is no need to be at the racetrack, and there is no need to go and visit a high street bookmaker. There's no need to even make a phone call. Simply pick up your mobile phone or any other mobile device and use one of the dozens of betting apps that have proliferated in recent years. It’s quick, it’s easy, and most importantly, it is totally confidential. It’s not hard to see the appeal.
With the total online gambling market estimated to be in the region of £1 billion a year, it is understandable that the competition to win your business is fierce, regardless of how little or large you bet. Hence, the number of bonuses and promotions that are thrown at you by the online players virtually on a daily basis is non-stop. This is one of the major issues for on-course bookmakers. At the recent 2023 Cheltenham Festival, one of our online bookmakers of choice (SKY Bet) offered a ‘free’ £10.00 bet for each of the four days. It was simple, and to be honest, it was highly attractive. Place a bet on any race of the day up to the value of £10.00, and if the bet loses, you are fully refunded the £10.00 stake back as cash into your account. No silly restrictions or terms and conditions that are usually associated with so called ‘free bets’ these days. Place the bet. If you win, you get paid out. If you lose, you get your money back in full. As a punter, just why wouldn’t you do it? Obviously, we did. Every day. However, the question is raised, how does an on-course bookmaker even begin to compete with that type of offer? The answer is simple: they can’t. So they lose out, because punters are placing bets online and not at the track.
The online incentives don’t stop there. It is now standard practice for the online operators to offer ‘extra places’ on horse races. They are not even reserved for races with a large number of runners. It is not uncommon to be offered 1/5th place odds on the first 6 places in races with circa 10 runners. At the festival, in races with 16 or more runners, SKY Bet was offering 1/5th place odds on the first 8 runners’ home. From a punting perspective, it is an absolute no-brainer. From an on-course bookmaker's perspective it is their worst nightmare come true. Again, how do they even begin to compete with such offers? As we know, if you rock up at the track and place a bet with a bookie, then normally you get 1/5th odds on the first three horses home. Also, the online bookmakers usually (but not always) pay out on a ‘first past the post’ basis. If you back a winner and it is disqualified for any reason, they still pay you out. In the majority of cases, the on-course bookmakers will not.
On-Course Rails Bookmakers - Opening Day of the Cheltenham Festival 2023
Betting Exchanges: Arose from the advent of the Internet and associated technologies in the late nineties and early noughties. The betting exchanges take zero risk. They effectively work on a commission basis by taking a very small slice of each winning bet or transaction made. It is usually between 2% and 5%. On betting exchanges, punters effectively bet with each other directly and cut out the middleman. Unfortunately for the bookmakers, they are the middleman. Due to this, it was widely believed that betting exchanges would completely change the face of betting and bring about the total demise of bookmakers as we know them, both on and off course. While this doomsday prediction has obviously not happened, it certainly hasn’t helped their cause either. That much is for sure. The reason for such dire predictions is easy to understand. The betting exchanges allow punters to do things that are simply not possible with normal bookmakers. Such as the ability of the punters to lay bets and not just stake bets. In other words, the punter becomes the bookmaker – literally. The punter can back his or her judgement either way. This was not possible before the advent of the exchanges.
Another small but underrated benefit of the exchanges is that, generally, odds for long-shot bets or outsiders are usually better than traditional bookmakers. Normally, on-course bookmakers do the exact opposite, reducing the odds on such bets in an effort to balance their book and reduce their liability.
Also, for a lot of professional and serious punters, the betting exchanges have become the preferred medium of wagering bets. The simple reason is, that they will not get banned or have significant restrictions placed on the value of bets they can place if they are successful. Banning or restricting the size of bets with punters who win regularly is a common practice with online bookmakers. Contrary to popular belief, in a lot of ways, online bookmakers do not take risks. For the above reasons, betting exchanges are now big business in the industry. Betfair, the largest exchange of them all, has in the region of 14 million unique visits a month from punters who are betting and matching on anything and everything 24 hours a day, 7 days a week. In previous years, a lot of serious punters would place their bets with the bookies, on the rails at the track, or by phone. Not anymore...
In some areas, the exchanges have actually made the traditional bookmaker redundant. No longer does the bookie make his book on each event by calculating the risk and using their experience. The initial market is already set by users of the betting exchanges well before the event or race actually takes place. Bookmakers also regularly use the exchanges to lay off money to reduce exposure or liability that they may be carrying from their own customers. In this way, the exchanges have actually replaced traditional bookmakers. The dated image of the bookmaker standing on his stool and relaying the odds by using hand signals and the old-fashioned tic-tac system is very much in the dim and distant past. To paraphrase the title of a famous pop song (the first one ever played on MTV), Technology killed the tic-tac stars. History always has the habit of repeating itself if allowed to do so...
Cashless Society: Is yet another wave of technology that appears to have come from nowhere in recent times, to drive yet another large and very pointed nail into the coffin of the on-course bookmakers. The fact is that less and less people are carrying cash, and the horse racing industry itself is actively going out of its way to ensure this trend only increases and accelerates. The reduction in cash at the track can only be to the detriment of the on-course bookmakers. So just why has the Jockey Club made the decision that all of the racecourses they own and operate will be completely cashless? It's now the credit / debit card way or the highway with the Jockey Club.
With this situation, why even bother taking cash with you? What’s the point anymore? If you don’t take cash, how do you bet with the on-course bookmakers? Yes, we know that a lot of them do take credit cards, but in our opinion, that reduces the "betting experience". The thrill and excitement of searching for the best price amongst the hustle and bustle of the rails bookmakers before handing over your fiver, tenner, or whatever denomination of note you can afford and going toe-to-toe with the bookie is seriously diminished. Why bother walking up and tapping your phone or credit card against a terminal at all? Just simply place your bet on your phone from the comfort of your seat or position at the bar. The only losers here are, once again, the on-course bookmakers.
As most racegoers know only too well, walking off a racecourse after a day’s racing with more money in your pocket than you came on with is a serious achievement and one that lives in the memory. You have beaten the bookies! Betting with your credit card or Apple Pay account doesn’t really have the same thrill for us. Call us old-fashioned: we don’t care. We know for a fact, that the vast majority of racegoers who actually take the time, effort, and expense to visit a racetrack agree with us.
We all know the reduced use of cash was accelerated by the pandemic and also by demographic factors in the population. Kids and young people simply don’t carry cash anymore. But no cash at a racetrack? Does the Jockey Club have research that shows that the typical demographic of a regular racegoer is a kid or a young person? We very much doubt it. Why? Research by the University of York shows that circa 80% of people who attend racetracks are over the age of 30. It also shows that the sport struggles to engage and retain younger audiences. So whose good idea at the Jockey Club was it to go completely cashless? We can honestly say, that during our travels to racecourses across the length and breadth of the UK, we have yet to meet even one single, solitary person who thinks it’s a good idea. In our opinion, it's impersonal, its soulless, and a retrograde step, particularly for on-course bookmakers. Yet the upset it causes is totally self-inflicted by the people who are supposed to have more than a vested interest in the sport.
So, is it just another case of modern technology sweeping out the archaic practices of the past. Are the the dinosaurs being put out to pasture like they have in many other industries in recent decades? We sincerely hope not in the case of the on-course bookmakers. They are part of horse racing’s fabric and soul. Any racecourse would be worse off without them. On-course, big time bookmakers will continue to flourish at the major racing festivals and headline meetings, that is not in doubt. What is in doubt is their continued existence at the smaller midweek, provincial meetings. However, unless things change, unless they are given some form of assistance, some form of competitive edge, and some form of reason to exist, they will disappear in the not-to-distant future. If they do, it will be to the detriment of horse racing and the sport in general.
The end result is that attending a race meeting will become just another "click & collect" virtual experience, and we can all do that sitting at home. It will be yet another reason not to go to the races and instead place our bets on our mobile phones, using our betting apps, and all that changes is the credit balance at the top of the page. If and when that scenario does eventually come to pass, it will be a very sad day for punters, for horse racing, and for the on-course bookmakers everywhere.