Virtual Racing Success Despite Negative Research
One of the better examples that I can give is when I was employed by the UK betting industry when my shareholders were the three biggest UK bookmakers. When British horse racing was closed down due to the foot and mouth disease in 2001 it created a big void in the bookmakers’ daily schedule. We were commissioned with putting together a product to replace this void and one which did not involve real animals.
Our answer was Virtual Racing. These were computer simulations of races on which customers were able to place bets just like on actual horse racing. Each race was different, created in real time and transmitted live to each of the 10,500 UK and Irish betting shops from a central broadcaster.
The board approved the idea so we conducted qualitative and quantitative research. It worked out horribly. Gamblers wrote it off as “Mickey Mouse racing” and the focus groups told us in effectively one voice that they would never play it. On paper it was a flop.
That’s where intuition stepped in. We felt punters would be convinced if we did two things. One, make it look and sound like an actual quality TV broadcast. Two, structure the odds so that an even money favourite actually had a 50 percent chance of winning.
When it came before the board, there was an equal split on the vote. It was with his casting vote that the chairman made the gutsy decision to put £1 million into the development of the product. That call was one of the biggest chunks of innovation in betting history. Virtual racing became a mainstay of every UK betting shop and brought the industry more than £1 billion in revenue per year.
The lesson it taught me is this: information is worth something but customers don’t always know what they need until they can see it. Research is a tool but successful marketing also involves judgment, imagination and sometimes the ability to take a risk.
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