Buy the Book - By Dan Liebman

(Originally published in the March 13, 2010 issue of The Blood-Horse magazine. Feel free to share your own thoughts and opinions at the bottom of the column.)    

The key to the success of any business is to know what the customer wants…and give it to him. Once again Keeneland has listened to its customers, recently announcing minor but significant changes to the structure of its September yearling sale.

Keeneland, and all other auction companies, are different, however, from most other businesses. They aren’t retailers or wholesalers; they are merely middle men. Their customers are both the sellers and the buyers, and they must keep both groups happy.

Where the sale companies do have something in common with other businesses is that the needs of their customers have changed.

It goes without saying that much is different, in the world and in the Thoroughbred industry, since the initial auction was held at Keeneland in 1938. The first of what would become an annual yearling auction was conducted under a tent in the paddock five years later.

Interestingly, that first Keeneland yearling sale was conducted by rival Fasig-Tipton because travel restrictions during World War II kept breeders, as was their custom, from shipping their yearlings to Saratoga Springs, N.Y., by rail to be sold. Also interestingly, that auction included a colt by Sir Gallahad III. Purchased by Fred Hooper and named Hoop Jr., that colt would go on to win the 1945 Kentucky Derby.

Before the summer of 1944, after Fasig-Tipton had decided against holding another sale in Kentucky, Keeneland co-founder and Beaumont Farm owner Hal Price Headley and Claiborne Farm owner A.B. Hancock Sr. formed the Breeders’ Sale Co. to ensure the continuation of an auction in Lexington.

While the first Kentucky sale was represented by graduate Hoop Jr. winning the Derby, the initial auction held by the Breeders’ Sales Co. included 1945 champion juvenile colt Star Pilot and champion juvenile filly Beaugay. Since then, Keeneland has become the largest-grossing Thoroughbred auction house in the world. But you don’t get there by yourself, nor without paying attention.

Many scoffed when Keeneland canceled its July yearling sale in 2003, but buyers—especially those from out of the country—had let it be known they were tired of traveling to Kentucky in July for a two-day sale, then to Saratoga for another few days, then back to Lexington in September. Instead, they insisted, let Keeneland add days to September if necessary.

It was a calculated risk for Keeneland, conceding the first two yearling auctions to Fasig-Tipton—Kentucky in July and Saratoga in August. Dollars spent at those two sales meant the possibilities a buyer’s bankroll would be shot or his order book filled before September rolled around.

But it was a risk worth taking.

The last couple of years, however, it appeared consignors were shunning Keeneland’s Book One, preferring to sell in Book Two or Book Three, where a good horse seemed more likely to stand out. Despite that being in conflict with the mantra of every consignor—you can’t hide a good horse—actions speak louder than words.

Thus, Keeneland has changed its format for this September, with a smaller Book One of 200 horses to be sold during night sessions Sunday and Monday (the sale formerly began on Monday), and a larger Book Two to be spread across Tuesday through Friday.

The first two days will now more closely resemble the old July sale while the second book, with roughy 1,300 horses to be sold over four days will spread the quality more evenly over more days.

Buyers and buying trends are continuously changing, but one thing that has remained constant is that a buyer’s time is precious. A more segmented catalog will allow buyers to more precisely plan when to shop.

With solid sales so far this year in Australia and New Zealand, and some positive signs at juvenile sales in Forida, Keeneland has chosen a good time to respond to the wishes of its customers. 

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