Sports sponsorship saw a healthy uptick in 2019, registering a growth of 17% despite the overall advertising industry experiencing slow growth of just 9%. According to a report by ESP Properties, the entertainment and sports division of GroupM, the sports sponsorship industry is now worth Rs 9,109 crore, and 59% of the incremental growth over 2018 was the result of media spends which amounted to Rs 5,232 crore in 2019. ESP Properties business head Vinit Karnik said the growth of the industry has been encouraging.
“In particular, it is surprising that on-ground sponsorship has grown to Rs 2,006 crore in 2019, a growth of 25% over 2018. Brands are known to prefer ad spots on television, but they are now also recognising on-ground activation as an important element of consumer marketing,” he said. The Indian Premier League (IPL) 2019 and the ICC World Cup contributed to the strong growth of the industry in 2019. “Despite having a large base, IPL team sponsorship grew by 15% in 2019,” Karnik said.
In fact, IPL has strengthened the industry since 2008. In 2008, the sports sponsorship industry was worth only Rs 2,423 crore, of which Rs 1,150 crore constituted media spends, the report stated. The ongoing Covid-19 outbreak could, however, have an impact on this hugely popular annual tournament this year. The Board of Control for Cricket in India (BCCI) on Friday announced that IPL will be suspended until April 15, 2020. On-ground sponsorship may take a hit with authorities proposing to conduct the high-profile IPL indoors and at fewer venues. However, ad rates and broadcast sponsorships may not be negatively impacted as more people are expected to watch the tournament on TV or stream it online.
If the IPL matches are played in empty stadiums, the franchisees stand to lose the money they earn from ticket sales. One match brings in about `3-5 crore for a host team and the total collection is about Rs 300 crore. “While there will be loss on stadium attendance, IPL as a brand has huge advertiser support and loyal viewership. TV viewership of the league could actually gain if all other outdoor events are scaled down,” Mogae Media chairman Sandeep Goyal said.
While stepping out of the home to enjoy a game may not be the flavour of the season, e-sports is gaining favour among Indians. In 2019, companies such as Amazon, Flipkart, Red Bull and PepsiCo took an interest in the industry.
Karnik pointed out that e-sports is emerging as a platform like TV or online media. “E-sports is one of the most compelling platforms for advertisers to engage with consumers. The growth of e-sports in India will come from mobile users, unlike other markets where games are played on desktop/PCs,” he said. In the long run, advertisers are expected to co-invest with technology partners to create their own IPs and thereby engage with users.
By the end of 2020, India could have as many as 5 lakh professional gamers vying for a prize pool of over Rs 15 crore. “There are users on Mobile Premier League (MPL) who are making upwards of Rs 25 lakh, all the way up to `1 crore. We also have people who game on the app over weekends and an hour or two a day, who earn around Rs 50,000- Rs 75,000,” Mobile Premier League co-founder and CEO Sai Srinivas said.
Srinivas said MPL internal data show that gaming and e-sports is not confined to the metros and big cities anymore. “MPL is currently present in over 170 cities in India, with more than 150 of these being tier-2 and tier-3 cities. Many of our big winners come from these cities, and they include working professionals, homemakers, students looking to supplement their income, and in some cases, full-time gamers on MPL,” he added.