This written document is a more detailed description of the presentation entitled JRA. The document outlines the plan and viability of a proposed two day horse racing event in Japan and was prepared as part of a university assignment which focuses on a sponsorship proposal.
3. Overview
A world championship horse racing event in Japan fills a gap in the racing calendar for
globetrotting group one campaigners and it is the next logical step in Japan becoming a
bigger force on the international horse racing stage. Japan has been taking steps in an effort to
become more internationally recognised and by running this two day festival in Nakayama
racecourse in December, Japan could soon find themselves becoming leaders in international
racing. The two day festival will incorporate the Arima Kinen, a major group one race run in
Nakayama. This flagship race, will instantly allow Japanese racegoers to make a connection
with this well-established group one which is “The world’s biggest race in terms of betting
turnover” (Japanracing, 2013).
These two high class days racing will offer punters a world class betting product. The
festival will cater for the top rated horses on both dirt and turf surfaces and these two
fantastic days racing will be broadcast around the world by the major horse racing channels,
as well as various terrestrial television channels.
As a major sponsor of this event, the JRA will be given the naming rights of this event and
will enjoy a major profile with customers of the international event. The event will create a
platform for the JRA to network with various internationals, as well as allowing customers to
do business also.
How International Racing in Japan has Developed
•
In 1981, Japan developed its’ first international invitational race, the Japan Cup,
which paved the way for international racing to develop across the world.
•
Racing in Japan was still quite restrictive:
- 2004: 22 races were open to foreign based participants.
- 2007: 111 races were open to foreign based participants.
•
Only a restricted amount of owners may exist in Japan and Sheikh Mohammed has
recently joined this elite group. The introduction of Sheikh Mohammed to the
Japanese horse racing industry illustrates the potential for further international
4. investment. A world championship event will encourage and allow for networking
between international investors and members of the Japanese horse racing industry.
•
Japan Cup has attracted Derby, Arc and Breeders’ Cup winners.
•
World Super Jockeys’ Series is held in Hanshin in December.
•
2010: Japan Association of International Racing and Stud Book was established in
replacement of Japan Association of International Racing and the Japan Racing Horse
Registry.
(Japanracing, 2013)
Nakayama racecourse
•
Home of the Arima Kinen
•
Established in 1920
•
Dirt and Turf courses
•
Right handed
•
Capacity 165,676
•
Located quite close to Narida and Haneda airports.
•
Surrounded by a good transportation system.
(Japanracing, 2013)
Aims
5. •
To create a world championship of racing, with horses from various parts of the world
competing. Listed under target audience, is the different groups of horses which are
predicted to compete at this international event.
•
Showcase & promote Japanese racing as a world class industry, with world class
facilities.
•
Showcase the talent of Japanese horses to the rest of the world and allow for
international networking and investment to occur.
•
Increase annual betting turnover and, as a result, increase the revenue of the JRA.
This will occur due to the increased wagering in Japan, as well as the development of
new international betting markets. For the majority of the time, the major bookmakers
in Ireland and the U.K offer their own prices on international racing, whilst allowing
for their own margins, but for major races these bookmakers will bet into the local
pools whilst offering payouts that are adjusted for their operating costs.
•
Promote the growth of Japanese exports:
- Having recently had a number of Japanese runners in European races, most notably
Ofervre in the Prix de l’Arc de Triomphe, Japanese trained and bred horses are
becoming more attractive in the European market.
Event Details
Dates & Times:
Friday 20th December, 7.30 pm – 10.30 pm – Opening reception
Saturday 21st December, 3.30 pm – 7.30 pm – Day 1 of racing
Sunday 22nd December, 1.30 pm – 5.30 pm – Day 2 of racing
Location:
Opening reception and racing to be held at Nakayama racecourse.
Attendees:
Nakayama racecourse holds approximately 165,000 and it is expected
to be at full capacity on both the Saturday and Sunday.
Cost:
Transport:
Tickets will range in price from $100 to $10.
Located quite close to Narida and Haneda airports.
Good public transportation to and from the racecourse.
6. (Japanracing, 2013)
Opening Reception, Friday 20th December
This opening reception will create a hype around this extraordinary international event. A
press conference will be held at the beginning of the reception whereby a panel of five or six
major competitors will be asked questions on their intended runners or mounts. After the
press conference, the opening reception will be a formal affair with a champagne reception,
finger food and some various Japanese arts performances will be provided for entertainment.
An international atmosphere will be held throughout this reception, whereby Nakayama
racecourse will have the flags of the various competitors flying. The reception will allow for
these international competitors to network and will also allow members of the JRA to build
relationships with its’ customers.
The following are a list of the major group 1 races to be run during the JRA International
Championship.
Day 1 Racing, Saturday 21st December
•
3yo plus Dirt sprint 1200m $2.5million
•
2yo Dirt 1400m $2milion
- This shorter distance will entice fast US 2YOs who may not stay the KY Derby
distance, but it is illogical to expect any Triple Crown contenders to compete here.
•
Fillies and mares turf 2000m $2.5million
- Won’t take away from Arima Kinen because of its’ value.
•
2yo fillies turf 1600m $1.5 million
- Sharper fillies have the option of taking on the colts
•
3yo turf 2000m $2.3million
7. Day 2 Racing, Sunday 22nd December
•
2yo turf 1400m $2million
•
3yo plus dirt 2000m $2.5million
- Attract Japan Cup Dirt horses
•
3yo plus sprint turf 1200m $3million
•
3yo mile turf 1600m $3.5million
•
Arima Kinen turf 2500m $8million
- Prize money boosted by $2.8million in an effort to attract an international field and
increase the prestige associated with the race worldwide. (Japanracing, 2013)
Gap in the International Racing Festivals
•
Dubai World Cup March 29th
- Dubai Carnival January 9th (dubairacingclub, 2013)
•
NEW: Australia Championships April 12th/ 19th (Kerr, 2013)
•
Royal Ascot June 17th – 21st (Royal Ascot, 2013)
•
Prix de l’Arc de Triomphe 6th October
8. •
Breeders’ Cup 1st – 2nd November
What horses will be attracted?
•
Top international horses
- US, Hong Kong, Australia, UAE & Europe
•
Breeders’ Cup horses (Nov. 1st & 2nd)
•
Melbourne cup horses (Nov. 3rd)
•
Dubai Carnival horses ( Jan. 9th)
Target Audience
(HRI, 2011)
The above target audience represents an international audience. International owners would
be attracted to attend, given that this is an international invitational event whereby the JRA
pay for the travelling expenses of international runners.
9. Marketing
The goods and services on show at an event make up the experience which the customer is
buying, but these goods and services must be marketed appropriately and to the correct
audience. According to Robison et. al, (2010) marketing allows event organisers to
understand customer’s needs and desires and gives an event a better chance of achieving
customer satisfaction, “Marketing enables event organizers to capture customer data and
understand what motivates event attendance”. If the JRA International Championship can
gain an understanding of these desires and motivators it will give itself a better chance of
retaining these customers for the following year.
Given that this event is seeking to attract an international audience, it is necessary to apply a
differentiated targeting strategy based on geographic location, as well as the expected benefit
that a specific segment will get from their experience (Robinson et. al, 2010). It is necessary
to advertise in a suitable language and, in this advertisement, a message that is appropriate to
that target segment should be clear to the customer, e.g large betting pools for the bettors and
prize money levels to horse owners.
Having the right marketing mix in place is vital:
-People: Staff must be capable of delivering the service to a world championship standard.
-Process: The right systems and procedures must be in place to deliver the event.
-Physical Evidence: Uniforms, signage and website development must incorporate the same
brand image of a high quality betting and racing product.
-Product: An event product is produced and consumed at the same time. Its’ features include
high quality racing, betting product, venue and service. Its’ benefits include customer
satisfaction of having witnessed this quality racing, betting on the product and engaging in
social interaction.
-Price: This event will be marketed as a premium event so a premium price should be
allocated to the majority of tickets. Ticket prices will range from $100 to $10.
-Place: Tickets will be available through online intermediaries or directly to consumers.
-Promotion: The event will be promoted in the most suitable marketing channels according
to the target segment to which they belong. In any promotional message however, it is
important to grab the attention of the customer, hold their interest, arouse desire and obtain
action through purchasing a ticket or involving them in the event.
10. (Robinson et. al, 2010)
Media Coverage
There are currently 5 television stations who have committed to purchasing the television
rights of the JRA International Championship which include TVG, Attheraces, Sky in
Australia and two terrestrial television channels in Japan. The television fee has been set at
$50,000 for each television station and includes reduced cost of television advertising.
Why Should JRA Sponsor?
The JRA is the ideal sponsor for this event, as the event’s goals are so closely linked to the
marketing plans of the JRA. JAIRS (Japan Association for International Racing and Stud
Book) was established in 2010 and one of its missions was “The conduct and support of
International Events Relating to Horse Racing and Participation in International
Conferences”. The growing trend of increased international participants and international
invitational races in Japan emphasises the need to take racing to the next level.
It is important to understand the return on investment that a sponsor expects to receive,
having financed an event. These expectations include the four categories of sponsorship
objectives:
•
Direct sales: Ticket sales, merchandise, television rights, food and beverage
(depending on whether or not it is outsourced) and in the case of the JRA, betting
turnover.
•
Brand awareness: This is often best achieved from television advertising.
•
External corporate awareness: Networking with home grown and international
customers and competitors.
•
Internal corporate awareness: Allowing JRA employees to truly understand what the
company represent.
(Robinson et. al, 2010)
Finance
11. The following are a list of the major costs associated with running such an event:
Total prize money on offer:
$24.6milion (Not including the $5.2million
previously set aside for the Arima Kinen)
Transporting foreign runners:
$225,000 (15 horses @ $15,000)
Marketing (includes t.v advertising)
Increased workforce
$400,000
$10,000 (100 extra staff for 1 day @ $100 per
day. Arima Kinen would be in JRA budget)
Catering for international customers $50,000
Other
$25,000
Although there may be various other minor costs, in comparison to the above, involved in
running such an event, the finance that is needed for such an event should not vary too much
around the total of $25,310,000. This is the amount of sponsorship that is being sought to run
the JRA International Championship.
The figures below give an indication of where this sponsorship money will come from and
have lead the International Championship to believe that the JRA is the most suitable
sponsor, having come from a thriving industry that is seeking to progress forward at a global
level.
Japan operate a pari-mutuel wagering system whereby, of the betting turnover:
75% is returned in the betting pool to customers
10% is taxed by the government
15% is offered for prize money and operating profits.
(Japanracing.jp, 2013)
In 2011:
Total betting turnover = $22,703,073,577
15% (prize money and operating profits) = $3,405,461,037
Total prize money = $934,750,239
Operating profits = $2,470,710,798
12. (Japanracing.jp, 2013)
$25,310,000 is a realistic sponsorship figure when viewed alongside the above figures. The
Arima Kinen is “The world’s biggest race in terms of betting turnover” (Japanracing, 2013).
This statistic has the potential to reach the whole weekend, which would allow for huge
betting turnover for the JPA.
In sponsoring this event, the JPA would be fronting one of the most prolific racing events in
the calendar. It is a great investment opportunity not only to increase their turnover, but to
develop Japan into an industry leading nation in International racing.
13. References
dubairacingclub. (2013). 2014 Dubai World Cup Carnival Programme. Available:
http://dubairacingclub.com/race/dubai-world-cup-carnival/dwcc-programme. Last
accessed 21st Nov 2013.
HRI. (2011). Strategic Marketing Group Report. Available:
http://www.goracing.ie/HRI/Resource-Centre/Strategic-Marketing-Group/. Last
accessed 21st Nov 2013.
japanracing. (2013). Japan Association for International Racing and Stud Book
(JAIRS). Available: http://japanracing.jp/en/jpn-racing/jairs.html. Last accessed 14th
November 2013.
japanracing. (2013). JRA Race Programme (2013). Available:
http://japanracing.jp/en/information/jra-race-programme/index.html. Last accessed
22nd Nov 2013.
japanracing. (2013). Statistics (JRA) (2013). Available:
http://japanracing.jp/en/information/jra-race-programme/index.html. Last accessed
22nd Nov 2013.
Kerr, T. (2013). Australia to host end-of-season championships. Available:
http://bloodstock.racingpost.com/news/bloodstock/randwick-australians-reveal-newchampionship-meeting/1561686/. Last accessed 21st Nov 2013.
Robinson P., Wale D. & Dickinson G. (2010) Events Management, Oxfordshire,
CABI Tourism Texts
Royal Ascot. (2013). Race Meeting. Available: http://www.ascot.co.uk/royal-ascot2014/royal-ascot-begins. Last accessed 21st Nov 2013.