Wednesday, 15 January 2014

No More Nonsense at Newbury (or at least for the time being), Part 3 – Understanding the Challenges facing the Racecourse and Putting the Dress Code Fiasco into Context

A large group of us went to Newbury Racecourse on 28th December to cheer on Shantou Magic in the Grade 1 Challow Hurdle. He came 4th, after a very bold and brave attempt to make all. It was a real privilege to be in the winners’ enclosure after a race of this importance – the dream over his long-term future is well and truly alive. He may well race again at the end of the month in a valuable handicap before stepping him back up in grade again. A really exciting day – and fortunately, no silly dress codes to deal with. My wife, Jack, bravely wore exactly the same outfit as on Hennessy day, without incurring the wrath of poorly trained stewards.

During the day I was most impressed that the newly appointed CEO, Julian Thick (former MD of Aintree, Sandown and Kempton Park) went out of his way to track me down and was most generous with his time. We had a long discussion about the dress code, and also the broader strategic development of Newbury. He couldn’t apologise enough for the poor implementation of the dress code, and as compensation is going to provide lunch in the Royal Box on Betfair Gold Cup day, Saturday, 8th February, which is something to look forward to.

In the short term, the dress code has been suspended while Newbury considers what to do next. Defusing this issue and mitigating the PR damage of it was clearly the only sensible option. So what should Newbury do next in terms of customer behaviour and “standards”? Indeed, do you think it should do anything?

I thought an interesting starting point would be to look at the finances of the racecourse. The track is part of Newbury Racecourses plc, a group of companies that own the racecourse and engage in “racing, hospitality and catering retail activities”. Very significantly, in 2012, they entered into a joint venture development agreement with David Wilson Homes for a major redevelopment of the racecourse, together with the construction of 1,500 homes. While there is apparently strong demand for these apartments and houses which are being built along the racecourse, there is much lower demand for actually attending races. In 2012 the track lost £1.2m, although profitability has improved since, with increased media revenues and the securing of longer-term sponsorship deals with the likes of Moet Hennessy, Dubai Duty Free and Bet365. Just like most companies with rising costs and falling revenues, they have completed businesswide reviews to stem the losses and increase the turnover.

Cynics (and there is no shortage of them in our sport) argue that Newbury is now just a real estate asset that happens to have a racecourse at the centre of it. At some stage, do you abandon racing altogether, or let it decline while looking for easy revenue through rock concerts, parties, exhibitions, conferences etc.? Encouragingly (and I’m definitely not in the cynical camp), all the strategic statements within Newbury’s accounts indicate a very robust commitment to quality racing and the Board is chock full of leading owners and racing enthusiasts with considerable business experience. Also they have signed up for the premier tier prize-money agreement with the Horsemen’s Group, which was absolutely the right thing to do.

It seems to me that Newbury is trying to grapple with the broader challenges that face our sport. Attendance is declining, as is individual customer spend. The last thing it wants on the track is drunken, loutish behaviour that will frighten away customers. However the dress code fiasco wasn’t the way to change behaviour. The problem though still exists. With all the rebranding that “The Racecourse, Newbury” is trying to pursue (and whether you believe this is contrived or not is another debate), it only seems sensible that influencing customer behaviour in such a way as to increase and sustain attendance is central to the overall business and financial strategy necessary to ensure that Newbury survives as a top-quality racecourse.

So what should Newbury (and for that matter, other racecourses) do next? All views welcome. I promised to put forward some views in this blog, but after the discussion with Julian Thick I felt it important to put the whole debate into a broader context first.

Wednesday, 1 January 2014

Nonsense at Newbury, Part 2 – While The New Management Relents on the Dress Code, They Now Need to Take Stock of Broader Initiatives to Improve Racegoer Behaviour

Firstly, Happy New Year to all our owners, regular readers and anyone else who finds the time to read our blog. As always the resolutions remain the same – eat and drink less, exercise more, blah, blah, blah. The key one though is to go racing as often as possible and enjoy everything that’s fantastic about our sport.

In the last blog of 2013, I discussed the nonsense of Newbury’s dress code and the PR disaster that it turned out to be at the Hennessy meeting. My wife and I were personally involved in this, with a highly embarrassing incident to do with a brand new and ultra-modern blue cotton coat with leather flashings that was deemed to be flouting the rule against denim, despite Newbury having declared in their advance marketing publicity that “Racegoers are invited to prove that Britain knows best when it comes to Autumnal fashion, with fabulous hats and coats”. Nonsensically that came to be translated as “Newbury’s stewards know best when it comes to applying inflexible and arbitrary rules on dress”.

The following week I had a lengthy discussion with the then joint managing director Stephen Higgins, who did everything possible to deal with our criticism and actually impressed with his commitment to “rebuild trust with the racecourse”. I am going to have a face-to-face meeting with the Newbury management fairly soon, and they have also invited my wife and me to lunch in the Royal Box – that should definitely see a couple of the New Year resolutions kicked into touch.

Encouragingly, on Tuesday, 17th December (a couple of days after I posted the last blog), the new Chief Executive, Julian Thick, announced that the controversial dress code, designed to encourage racegoers to “embrace a stylish but relaxed approach”, was being reviewed. The rules that caused the controversy on Hennessy day decreed that in the Premier Enclosure “smart trousers (no denim) are the order of the day for gentlemen, with a jacket preferred”, while women were required to wear “dresses or skirts of modest length, or smart trousers”. Jeans were banned. They now intend temporarily to relax the strictly enforced criteria and “smart jeans” will be tolerated while the overall policy is reviewed. As I said in the last blog, it is barely credible that a mature woman wearing a new blue trilby (bought at Haydock Park), a similarly new, ultra-modern blue cotton and leather coat (bought at Cheltenham Racecourse) and equally brand-new black trousers, could be deemed by the Newbury style police to be in breach of the rules. My wife was most definitely not alone in all of this, and the adverse publicity in both national and trade press must have seriously damaged the new branding that “The Racecourse, Newbury” appears to be trying to develop.

Let’s look at some of the broader implications. Everyone wants to ensure that more people come racing, and that they thoroughly enjoy the experience, so that our sport can build increasingly self-sustaining revenues while broadening the overall customer base, particularly so that it appeals to the next generation of racegoers. Alas, there have been a number of unpleasant incidents involving drunken oafs fighting on racecourses over the last year or two, and a particularly unpleasant episode occurred at Newbury between two competing groups of football supporters. Therefore initiatives designed to improve, modify or change behaviour in some defined way are all to the good. But this is obviously extremely challenging, whereas framing and applying inflexibly a dress code is relatively easy to enforce, even if it does nothing at all to change the offensive behaviour. As one of the TV commentators stated, “a drunken oaf in a shiny black suit is still an oaf”.

Very few, if any, racecourses in the winter apply such rules as Newbury was trying to introduce. Clearly a number of Flat meetings, notably Royal Ascot and Glorious Goodwood, apply very strict dress codes in designated enclosures. According to Steve Higgins, Newbury had taken soundings from racegoers before introducing the rules and there appeared to be enthusiasm for “raising standards”. I suspect the question should have been framed much more tightly, such as: “Do you feel that it is more important for Newbury to reduce the incidence of unpleasant and intrusive drunken behaviour, or that we should impose a dress code and ban denim?” While this may be an artificial forced choice, I think we all know what people’s preferences would be. It is reducing boorish, drunken behaviour on racetracks that really matters, rather than antagonising denim-wearers, many of whom have spent a considerable amount of money on designer clothes.

Equally, there is nothing wrong with trying to encourage people to wear smarter clothes, but the challenge for Newbury is how best to do that if, indeed, it is deemed to be a critical branding and customer relationship initiative.

So what should Newbury, and other racecourses, do next – if anything? Do let me hear your views and I’ll continue with this theme in the next blog.