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PHOTO BY EMILY MOSELEY
Melissa Nolan is the marketing director for the Kentucky Thoroughbred Owners and Breeders (KTOB)/Kentucky Thoroughbred Association (KTA). She holds a master’s degree in business administration from Midway College, where her thesis studied the model of wagering in Kentucky after the installation of synthetic surfaces at racetracks. Nolan has also worked as a financial services manager for Hagyard Equine Medical Institute, as well as a member and volunteer coordinator for the U.S. Pony Clubs.
What do you see as the major challenges facing the Thoroughbred industry?
I think our business model needs improvement. Racing gets a lot of flack because it’s not unified [in terms of having a central governing body], but at the same time, everything is so integrated. It’s a very obvious industry; you can see the business cycle, and I don’t know if it’s because my major in college was economics and I’m used to seeing things like that, but it’s clear that there’s something dysfunctional with our business model in some way. Things are just not fitting together. Each part relies heavily on the others but has different goals. The breeding side has different interests than the racing side and vice versa. Handicappers have things that they want that are different from what racetracks worry about.
It’s easy to say unity will fix our problems, but I think being smart about how everything is integrated is something we can really do. There’s nothing wrong with modernizing your business plan. Every good industry does it. Look at how the NFL has evolved over the last 20 years. I don’t think they ever could have dreamed what it would become, and they were smart about how they went about structuring their sport. How do we get everybody on the same page and make the sport better as we go forward? It’s definitely not functioning appropriately right now.
How do you get everybody working toward the same business plan?
At KTA/KTOB, quality is kind of our new slogan, and that’s what we want to impress upon the public. There’s the saying, ‘A rising tide lifts all boats,’ and I think that’s the attitude to take. We’re all on the same team here; it makes no sense for us to not work together.
I think that if we go for providing a quality product — breeders try to breed the best and fastest horses that they can, so that they’re appreciative of what bettors bet on, and racetracks want to provide the best product possible at the lowest possible price — each segment of the business will lift the others. There’s a way we can go about things where it’s not every man for himself. I think it’s just being the best that you can and recognizing everyone else is doing the same thing.
If you were the racing czar and you could do any one thing you wanted, what would it be?
I want to see a better tote system. I think that really should be improved. The technology’s antiquated. If you want integrity in the sport, you’ve got to make it operate like the technology that accepts purchases on NASDAQ or something like that, because that’s essentially what it is. This is 2012 — we shouldn’t have to have stewards literally pushing a button to stop wagering [before a race]. Couldn’t that be connected to the starters’ gun? We can do better. We can’t be making all these investments in mobile betting technology or mare produce apps, etc., and also have the fundamental monetary mechanism behind everything be so old. It just doesn’t match. I think we can improve that.
Can you give me an idea of what some of the challenges are with the tote system from a bettor’s perspective?
The stewards push a button when the race is about to go off to stop the acceptance of wagers. They’ve had a few instances where wagers are still accepted on races after the gates have already opened. A lot of high-spending bettors have had some big issues with that, which is totally understandable. That’s an unfair advantage [to those who get those extra minutes or seconds to make their betting choices] and just shouldn’t happen. It isn’t frequent, but it shouldn’t happen at all.
I’d like to see everything flow easier, have a more open market flow of dollars — and tighten everything up. Make sure site security for betting sites is adequate, and avoid pool manipulation, which is something that’s happened recently. You see a horse that’s supposed to be a longshot with odds of 2-1, because this huge win bet is placed on it, and [since the odds are determined by each entry’s share in the overall pool of money], that in turn distorts the odds on other horses.
That means that there could be a horse that’s 2-1 in the morning line, and now all of a sudden it’s 5-1. And you like 5-1 a lot as a bettor, so you think “I’m going to dump my $100 to win on it,” and all of a sudden, 30 seconds to post, and the big bet on that longshot gets cancelled, which lowers the odds of the other entries, and your horse is back to short odds that wouldn’t have enticed you to bet. The person who manipulated the pool likely wanted to bet the longshot at the greatest odds they could, so they attempted to distract everyone else with longer odds on the other horses.
And that’s perfectly acceptable under current rules, but I don’t think that people should be able to do $100,000 bets and cancel with 30 seconds to post. It’s inauthentic. I think that kind of thing can be improved.
How do you see the future of the Thoroughbred industry in Kentucky?
That’s what I’ve devoted my life to — horses, and specifically racing — and I think I come at it from a different perspective. My grandfather owned a cheap claimer or two, but I don’t consider myself born in the industry, so I think I have an “outsider” perspective and a more objective opinion of things.
I’m hopeful, because I have to be. And I want to be. I want this industry to succeed because I love it, and I can’t imagine doing anything else. Here in Kentucky, we’re the leader in everything that makes racing go, so my goal is to really promote the horses that we have and the infrastructure [veterinarians, farriers, professional horsemen] that we have, and use that to be an example for other industries to emulate. I think we have so much potential and unfortunately we had gotten complacent and took everything for granted in terms of our stature within racing.
We’re now letting our own success be dictated by outside states and outside interests, and I don’t like that. I want us to dictate our own success. We can do it; we just need to do a better job of showing the public how awesome a sport this is and how it makes you feel differently than any other.
There are so many facets of it for people to get interested in. We just need to get the message out there, but it’s going to take some time, because it took us some time to get in the position that we’re in.