IT HAS been trumpeted and condemned, all at the same time. Yet, it has not just survived but thrived. This year, a petition in the Supreme Court that the seventh season of the Indian Premier League (IPL) be scrapped and the apex court?s preliminary observations just weeks before the tournament was to start, suggesting that the Board of Control for Cricket in India (BCCI) chairman N Srinivasan step down and that the two IPL teams?Chennai Super Kings and Rajasthan Royals?whose players were alleged to have been involved in the betting and spot-fixing scam be suspended this season, put a huge question mark over the fate of the tournament. The official broadcaster Multi Screen Media (MSM) put its negotiations on hold, advertisers, too, were non-committal and all stakeholders were in the wait and watch mode.
As in the past, IPL survived. The show is on, MSM is busy selling its inventory touting IPL?s unique proposition as the only mass property attracting male and female viewers from across the country and advertisers are doing their maths to figure out how to maximise their returns on the investment and the IPL board, with veteran cricketer Sunil Gavaskar at its helm, is working out the last-minute logistics of organising the first leg of the tourney in the United Arab Emirates (UAE). As Rohit Gupta, president, MSM, puts it, ?I do not remember a single season when the IPL has not had its share of controversies. Yet, it survived. This is because at the end of the day, the consumer comes in to watch good cricket. As long as good cricket is being played and the top cricketers of the world play, people will still come to watch it. Last year was probably the best year that we have had till date and that?s because we had some outstanding cricket which brought back the interest in the game.? For the record, the cumulative reach of the IPL grew from 102 million in season 1 to 123 million, 144 million, 161 million, 163 million and 215 million in season 2, 3, 4, 5 and 6 respectively, according to data collated by TAM Media Research.
Gupta puts forward two arguments why the IPL, and thereby MSM, will come up trumps this year too. First, the number of matches to be played in IPL 7 is 60 compared to the previous season?s 76. As a result the number of afternoon games this season will come down. ?If you look at the previous years, the average ratings of the tournament came down because of the ratings of the afternoon games. Prime time, meantime, continued to hold the fort. Now with the afternoon games being less, we expect the ratings to grow,? says Gupta. MSM, therefore, expects the IPL ratings to stay at 4-4.5 TVR this year.
Second, all the teams are equally placed post the auction of players this season. ?Hence, this time anybody can win the tournament.
Consequently, there should be consumer interest from day one on how each team performs,? adds Gupta. Not to forget, while the first 20 matches is to be played in the UAE, these will start at 8 pm India time.
Therefore, despite the shift in venue, the TV viewership of the game should not see much impact.
This year, the broadcaster has pegged the ad rates at R4.75 lakh to R5 lakh for ten seconds, a 15-17% increase in rates over last year. However, market sentiments suggest that MSM is having difficulty selling the ad inventory. Only 50-60% of the ad inventory around the tournament has been sold as the media buying process got stalled due to the uncertainty in the wake of the apex court proceedings. ?This year the actual rate is between R3.8 lakh and R4.3 lakh for ten seconds,? says the chief executive of a media buying firm who did not want to be named.
Gupta, however, denies the drop in IPL ad rates. ?When it comes to the IPL, nobody buys ratings. They buy reach. They pay that kind of money because it gets them 200 million eyeballs. If they want to be on a 2 or a 3 TVR (television ratings) property, then there are enough shows available on television at one-fourth the rate,? he says.
Agrees Shivani Gupta, managing director, SPAG Asia ? a multidisciplinary marketing communications and advocacy firm, ?Marketing in IPL is a huge opportunity for brands primarily because of the core audience that the tournament commands and the huge visibility it offers to the sponsors. The question is whether a brand can afford to ignore IPL.?
Jai Lala, principle partner at media buying company Mindshare notes that this being the election year, a lot of brands and categories have been slow in allocating advertising budgets. ?Uncertainty over venues and teams found a lot of advertisers in watch and wait mode. But with things now falling into place, ad deals should be closed soon,? he says.
Mallikarjunadas CR (Malli), chief executive at Starcom MediaVest Group, on the other hand observes that it wasn?t the uncertainty about the venues or the Supreme Court?s observations that impacted television ad deals, as much as the fact that the economy was yet to pick up significantly. ?Advertisers don?t have the kind of deep pockets that they had before. Even fast moving consumer goods (FMCG) as a sector has slowed down. Telecom remains guarded in terms of advertising spends and auto is yet to pick up,? he says.
As per an executive at MSM who did not want to be named, Vodafone, Havells and Amazon have already come in as sponsors while Flipkart has come in as a spot buyer. Cadbury is close to signing the contract, he says. ?PepsiCo is still negotiating with the BCCI and therefore hasn?t come on board as a television
sponsor. Once they reach an understanding with the BCCI, they will,? he adds.
The same executive says that co-presenting sponsor Vodafone has paid R55 crore, while associate sponsors such as Amazon have come in for R25 crore. Some of the bigger FMCG companies such as Hindustan Unilever (HUL) and Procter & Gamble (P&G) continue to stay out of the tournament this year because of the high costs involved.
?Vodafone is the only prominent brand that has remained associated with IPL since its inception in 2008. Vodafone believes the IPL is one of the biggest sporting platforms in the country designed to appeal to a wide spectrum of consumers on a pan-India basis,? says a Vodafone spokesperson.
?Over the past six years, our experience has been that if you do things that are truly innovative and cutting-edge during the IPL then the multiplier effect and bang for the buck is unmatchable. Cricket resonates with Indian audiences and no other cricketing platform packages sport, talent, chutzpah and entertainment together as successfully as the IPL.? MSM does not expect any growth in revenues this year. Says Gupta, ?We did not go for a more aggressive 20-25% hike in ad rates because of the current market conditions. There is the election so a lot of money is going there. There is the T20 World Cup too. So there is a limit to the rates that the market will accept.? MSM?s IPL revenues, therefore, is expected to stay stable at R900 crore.
Talk of the franchisees and they, too, are struggling to increase their sponsorship revenue this year. Chennai Super Kings (CSK) is looking at a mere 5-10% jump in sponsorship revenues this year. It has signed on three new sponsors?Orbit Cables, GST Global and Orient Fan. Says Rakesh Singh, president?marketing, India Cements, ?The franchise expects an increase of 10-12% in revenues this year. Last year, CSK made R170 crore including merchandising, sponsorship, gate tickets and receipts from the central pool. This year there is still a bit of uncertainty in the kind of money the franchise will make from tickets as it is expected to play three matches in Dubai.?
Kolkata Knight Riders has brought three new sponsors on board – technology partner SAP, apparel brand US Polo and Sansui. It already has Nokia, Seiko Watches, Manyavar, Emta (an eastern India based brand) and Royal Stag as sponsors. The lock-in period for the deals is three years for most of the brands.
Says Manish Kumar, chief marketing officer, Kolkata Knight Riders, ?The delay in the announcement of the venue and the controversies surrounding the brand has actually hampered this year?s business. Also, as some of the matches will be played in Dubai, this has also reduced the scope of promotion and on-ground activation for local sponsors such as Manyavar.?
Meanwhile, Mohit Burman, co-owner, Kings XI Punjab is worried that there will be no growth in revenues for his team this season. ?With the general election, the controversies surrounding IPL and the uncertainties about the dates of the tourney, it has been difficult to get sponsors on board.?
With the first leg of the IPL shifting to the UAE, on-ground activation revenues are expected to witness a 15% hit. However, with the game shifting back to India from May 1, marketers are hopeful that it will see a revival in the last leg. ?From where we see it, IPL should see a rise of 7-10% in airtime revenue and 10-15% on the ground (including ticketing, franchisee fee, innovative inventory, etc.) It will be interesting to witness the IPL locking horns with the match fixing controversy and general election simultaneously. Let?s see who wins the tug of war,? says Bharat Rajamani, associate director of management consultancy firm EY.
As R S Suriyanarayan, associate vice-president, Initiative, Lintas Media Group (LMG) says, “Whenever controversies surround big sporting events, the event becomes even bigger.? Well, it?s now time for IPL to be making headlines for the action unfolding on the pitch.