Bookmakers buckle up for bumpy Melbourne Cup week

Australian wagering giants are preparing for a subdued Melbourne Cup carnival when it kicks off on Saturday, as they try to reverse a decline in betting turnover and risk losing customers disgusted at the recent revelations of racehorse mistreatment.

Betting has been on a downward trend across the spring racing calendar, with turnover from the Caulfield Cup on October 19 falling $31.4 million, or 24.6 per cent, to $96.3 million.

Tabcorp's managing director of waging, Adam Rytenskild, with Ventura Storm which will be running in the Queen Elizabeth Stakes. Credit: Eddie Jim

The blame has been pinned on the introduction of state-based point-of-consumption taxes levied on online bookmakers, which had made it harder for them to offer attractive odds and special deals, known as generosities.

Tabcorp's managing director of wagering, Adam Rytenskild,  said he could not say if its TAB wagering brand's turnover would be higher or lower compared with last year, but he was confident the total number of people placing bets with the TAB would rise.

He said consumer spending was tightening, which flowed on to gambling, while competition in the betting market was not accelerating at the same pace it was a year ago.

"There was a big step up in generosities last year and whilst the level is maintained there’s not the step up we had last year," Mr Rytenskild said.

There's a decent chance that turnover will be softer.

Sportsbet CEO Barni Evans

"The markets totally changed - marketing strategy has changed, pricing has changed, customer experiences have evolved."

Barni Evans, the CEO of online bookmaker Sportsbet, said the new taxes were having an impact on the industry but the size of it had been overplayed in some quarters, with several other factors at play.

Races had been unfavourable to punters, he said, with difficulties in picking a winner causing customers to either be reluctant to bet or run out of money earlier in the day and so bet less in total.

The two bookmakers both said turnover would suffer from the absence of champion racehorse Winx, which Mr Evans said drove people to place bets last year "just to say they had a bet on Winx’s last race".

Mr Evans acknowledged there was "a decent chance that turnover will be softer".

Meanwhile, the industry has been tarnished by the revelations of animal abuse after the ABC's 7.30  broadcast footage showing racehorses being sent to a slaughterhouse. Melbourne Cup-winning trainer Darren Weir is also facing animal cruelty charges over the alleged torture, abuse and over-working of horses.

“There will be a proportion of the population who will be more reticent in placing a bet now than they would have been before - I don't think we can deny that," Mr Evans said.

“It might turn out to be the catalyst the industry and government needed to put in place measures for much greater equine welfare going forward.”

Mr Rytenskild said the scandals were "not good in any way shape or form" and could impact the wagering industry long term if it was not dealt with quickly.

"If it's not dealt with over time then there definitely would be an impact," he said.

"Animal welfare is the absolute priority across all codes - we made it clear with greyhounds and greyhounds have been on a journey over the past couple of years in terms of animal welfare."