Kolkata Knight Riders is yet to make an IPL final. But, the Shah Rukh Khan-owned franchise is right up there in terms of brand valuation.
Ask Mr Venky Mysore, CEO and Managing Director, KKR, the mantra for its success and he adds that KKR has been able to successfully leverage its brand value through a wide distribution of sponsors. (Refer table)
The franchise so far has 22 sponsors — reportedly the highest by any IPL team — of which 10 are “apparel sponsors” (that is, names appearing on team jerseys, helmets and track pants) and the remaining 12 are “non-apparel sponsors” who have co-branded with KKR through television commercials or print advertisements.
New sponsors
Talks are on to bring four new sponsors this season, including the Kolkata- headquartered ethnicwear brand Manyavaar and Concast and the soft-drink major Coca Cola.
“It's all about balancing between the apparel and non-apparel sponsors and ensuring that the brand is optimally leveraged,” Mr Mysore said. A study by brand analyst “Repucom”, he says, has shown that sponsors of KKR had the best brand visibility amongst IPL teams.
With a focus to shore up alternate revenue channels, KKR has recently entered into merchandising and licensing agreements with “freecultr” for online sale of its casual wear range. It will also set up stalls outside stadiums to sell merchandise.
Challenges ahead
But, managing the sports entertainment business may not be easy at a time when companies are cutting down their advertisement or marketing budgets to cope with the overall slowdown. The architect behind KKR's financial success so far, admits the possibility of “overall spends coming under pressure”.
However, he has his work cut out. During the recent player auctions, the team went for three top buys – Brendan McCullum , S. Naraine and South African pacer, Merchant De Lange. The rest of the players were recruited at less than half-a-million dollars each.
“We have a well-placed talent pool varying between the experienced guys and youth. We expect it to work well for us,” he adds.
Mr Mysore says KKR is among the first teams to have broken even. “We closed our accounts for 2011-12 and, I guess we are the first, if not the only, IPL team to have broken even,” said Mr Mysore.