Just five months after IPL 2020 concluded, the 14th edition of the cricket extravaganza is upon us at home and set to kick off on April 9. Against all odds, despite the raging pandemic, the BCCI managed to stage IPL 13 in the UAE. What could have been a loss of ₹3,000 crore, according to valuation agency Duff & Phelps, a Kroll Business, was flipped around and the cricket board raked in ₹4,000 crore. Since the cricket was all on TV, broadcaster Star Sports saw a 23 per cent rise in viewership and earned advertising revenues of ₹2,600 crore.
As the 2021 edition is set to start, the pandemic has seen a resurgence, yet brands are storming the pitch fearlessly this year. There is none of the hesitancy of last year.
Vivo is back as the IPL sponsor, replacing Dream11 which came on board after the Chinese phone brand pulled out last year. Broadcaster Star Sports, which bagged the IPL rights till 2022 for a whopping $2.55 billion, has got 18 sponsors for the upcoming IPL season and over 100 advertisers. If edtech and fantasy sports dominated last year, this year brands are from literally all categories. Some of the key sponsors include Dream11, Byjus, Phone Pe, Just Dial, Bingo, Kamla Pasand, Association of Mutual Funds in India (AMFI), Frooti, Asian Paints, Thums Up, Vodafone-Idea, Mondelez and Amazon Prime.
Sources say Star has already sold 95 per cent of its inventory and hiked ad rates by 10-15 per cent compared to the last season. It’s learnt to be quoting ₹13-14 lakh per 10 seconds for ad spots.
Star can afford to get pricey as demand for advertising slots is surging. The summer season especially works for many categories like beverages and ACs, which are back to aggressive spending on IPL. Take Parle Agro, which is promoting its beverage brands Frooti and B-Fizz with aggressive spends on both Star Sports and on Disney+ Hotstar. Frooti has come on board as a sponsor for IPL for the telecast, while B-Fizz will leverage its association with IPL on the OTT platform.
Disney+ Hotstar has already locked in 14 sponsors and looks to bring in more brands. The platform has on board Dream11, which will be the co-presenting sponsor. Upstox and Vimal Elaichi are the ‘co-powered by’ sponsors. Other sponsors are PhonePe, AMFI, Unacademy, Pharmeasy, Livspace, Swiggy, Parle Agro, Amazon Prime, Coinswitch, CRED and Xiaomi, who have signed-on as associate sponsors. In addition, with Vivo as the title sponsor, Chinese firms have come back to IPL in this season.
For instance, Chinese TV and electronics company TCL has come on board as the official team sponsor for Sunrisers Hyderabad. Mike Chen, General Manager, TCL India, says it will drive more brand visibility and empower TCL to cement a leading position in India.
Hopeful franchises
Franchises which suffered a bit last year seem to be attracting marquee brands this year. Global sportswear brand Puma, which is back after a break of nearly eight years, has inked a multi-year strategic sponsorship deal with RCB as its kit sponsor. Says Abhishek Ganguly, Managing Director, Puma India and Southeast Asia, “Our on-going association with RCB team captain Virat Kohli, makes our partnership with RCB a natural progression for the brand.”
Fashion e-comm company Myntra has announced its partnership with three-time IPL champions CSK. As part of the association, Myntra's logo will feature on the front of CSK's jersey. The jersey itself sports a new look and features camouflage design on the shoulders as a tribute to the country's armed forces. Apart from Myntra, team owner India Cements Ltd, which is celebrating the milestone of 75 years, Gulf, Nippon Paint, SNJ and Astral Pipes are among the team’s principal sponsors and their logos feature on the jersey. CSK hopes the replica jersey will strike a chord with fans and orders could pour in through the CSK app or web site.
A fly in the ointment for IPL 2020 was the lack of in-stadia revenues from the sale of tickets, food and beverages. Bringing in Dream11 to replace Vivo at a discounted price – it paid ₹222 crore compared to the phone brand’s ₹440 crore — also made a dent. According to Duff & Phelps this had an impact on the IPL brand value as well as teams’ brand values (see charts).
For teams, among the most important revenue sources is a share they get from BCCI annually of the five year broadcast deal (of ₹16,347 crore) with Star Sport. In-stadia revenues (ticket fees, food), sponsorship deals and merchandise are the other sources.
Last year, the in-stadia revenues were nil and many franchises had to reduce sponsorship deal prices by 15-20 per cent due to IPL being held sans viewers. But this year franchises believe they will get back to pre-pandemic levels in terms of sponsorship revenues. As Satish Menon, CEO, Punjab Kings, says, “We are looking at a 30-35 per cent growth in sponsorship revenues compared to last year. This will be higher than even the pre-pandemic levels.” Growth in sponsorship deals will help offset some of the loss due to lack of in-stadia receipts, but he admits it won’t cover up for it entirely.
Jake Lush McCrum, COO, Rajasthan Royals, too says there is heightened interest by brands in partnering with the team. “We have achieved growth of over 40 per cent in our partnerships over the last year.”
Franchises have not done a great job with merchandise so far. As the Duff & Phelps report says, most franchises are still coming to terms with the best possible way to monetise different streams. An official of a top team admits merchandising IPL memorabilia is a long haul. “The market is growing slowly, not at the pace as in the international sporting landscape for licenced porducts.”
Also, European football leagues are on for 8-9 months in a year, unlike the two-month window of IPL. “So, if you buy a jersey, you can wear it for some 20-30 matches. Also, we need to get price points right for merchandise; fans won’t pay a premium,” he explains.
But things are picking up, evidenced by the aggression shown by Puma, which hopes to tap into the entire team merchandise category. Says Ganguly, “The organised team merchandising segment has nearly doubled in its size in the last two years to about ₹60 crore in the country. Our aim is to grow this category significantly in the country over the coming years.”
Fans are certainly invested in IPL, but let’s wait and see how many will wear the game!