(Photo : Darley)
“Three nominations each to Medaglia d’Oro, Hard Spun,
and Lonhro for the 2013 breeding season.”
About ten years ago, Summerhill built an online auction site for stallion services. It was at a time when we were developing new concepts in Ready To Run sales, which history tells us was one of the world’s great innovations in thoroughbred sales. However, when it came to online auctions of stallion services, it seems we were ten years ahead of our time. South Africans were just not “plugged-in” to the idea of buying their services through the internet, and only a miniscule percentage of our trade in this commodity took place on the website. Nonetheless, it gave rise to another concept, and that was the online sale of horses off the farm, which brought about the disposal of the champion racehorse Imbongi, and current J&B Met aspirant, Black Wing, among many other stand-outs.
This weekend Darley America announced that it will offer three nominations each to Medaglia d’Oro, Hard Spun, and Lonhro for the 2013 breeding season via an online auction platform on the Darley website. Three seasons, one for each stallion, will be offered each week for three consecutive weeks, and will carry Darley’s standard live foal terms with no reserves.
“We are extremely excited about this new initiative,” said Olly Tait, Chief Operating Officer of Darley. “We have been able to make three additional seasons available to several of our fully subscribed stallions, and offering the seasons online via an auction allows our clients guaranteed access at prices that will be determined by them.”
The auctions will also be open to those who already hold 2013 contracts for the three stallions. Should one of these existing contract-holders be the successful bidder for a price below the published fee, Tait noted that the client’s contract would be revised to reflect that lower fee.
Charlie Boden, the Head of Sales for Darley America, said the idea was born from the desire for innovation in the process of selling nominations. “We’re always looking for something new, and some innovation to help the marketplace,” Boden explained. “Because the internet has become a bigger part of everyone’s lives, we thought the timing might be good. The idea really is looking for efficiency, as opposed to looking for ways to generate revenue.”
Boden noted that Medaglia d’Oro, Hard Spun, and Lonhro were chosen to kick start the project because their books are already full, thus eliminating the risk of underselling those who have already purchased seasons at the advertised fee. “We’re using the three stallions that were the most popular in the way of demand at their price,” he explained. “So we’re going to really just test out the mechanics of the website and the auction process and do it without worrying about how much it might affect the prices. We don’t want to harm anyone who has a contract already. I hope the three seasons each week in the auction sell for the farm fee. That would be ideal, and we’d get three more nice mares to each of the horses, and hopefully three happy customers.”
Boden said that he also views the auctions as a potential method of price discovery. “I see it as a way down the road, if it works like we hope, to let the market determine the price, especially for the cheaper stallions,” he said. “What I hate is standing a horse for $25,000 that I should have stood for $15,000 and, as a result, I only get 30 mares, when he should have gotten 75 at a lower fee? It might allow us down the road to let the market determine the prices as opposed to guessing at what the market should be.”
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Extracts from Thoroughbred Daily News