This week, Groupe M/WPP released its 10th annual report – Sporting Nation – on India’s booming sports industry. The report tracks the sports sponsorship and advertising industry across the country, including real-time brand value and media spend, among other things.
Sporting Nation has estimated the total sports industry spending for the year 2022 to be Rs 14,209 crore, registering a growth of 49% from the year 2021.
For example, sponsorship spending, which stood at Rs 2,886 crore in 2021, went up to Rs 5,907 crore the following year, a massive jump of 105%.
Out of the total Rs 14,209 crore, cricket alone has earned a major share of Rs 12,115 crore, while all other emerging sports have received just over Rs 2000 crore.
Network18 spoke to Vineet Karnik, South Asia Head of Sports, E-Sports and Entertainment at Group M.
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With the pace at which the sports industry is innovating, especially with the advent of technology and new age businesses, cricket has to be the foremost catalyst in identifying industry trends, right? Because nothing sells like cricket. So, what is cricket telling you about this changing industry right now?
VK: Cricket is a game that has been playing on the front foot in terms of steering the industry through the ups and downs of the road to commercialization over the years. The franchise format was introduced in the country with the unveiling of the IPL in 2008, a property that has been a money-spinner of Indian sports ever since.
2022’s performance serves to highlight this position of pre-eminence for cherry and wood play in our minds, as it contributes 85% of the total we saw Play industry revenue, which is equivalent to INR 12,115 Cr. Despite the huge base value in cricket, we saw a growth of 44% for the No. 1 sport in India in terms of sponsorships, endorsements and advertising spend.
In sponsorship expenditure (grounds, teams and franchises), cricket accounted for 75% of all sports, while the corresponding number for endorsements stood at 85%. In media spend by brands, the role of top scorers was even more pronounced, with cricket-related content accounting for 94% of all ad spend across all media vehicles.
With our country serving as the hub of cricket consumption in the world, it is no surprise that Indian brands are making strategic investments in foreign leagues of the game, making sure that all grounds are covered. going because they are bowling in the ground. Engage with followers of the action from 22 yards!
Sponsorships have increased by 105% from 2021 to 2022. This is a mind boggling number. But how much of that 105% is cricket alone? this year, the IPL Crossed 1k crore per annum in terms of sponsorship.
VK: Spending on sponsorship (ground, team and franchise fees) Cricket Sponsorship grew by INR 2191 Cr, i.e. 99% and overtook the total sponsorship spend of 2021. The growth can be attributed to the following reasons:
• The Indian cricket team will play a total of 67 matches in 2022 as compared to 36 matches in 2021.
• Two new franchises are being added to the Indian Premier League (IPL) and the total number of matches has increased from 60 to 74, which itself indicates a huge increase in the overall monetization potential for their fixtures.
The more important question is that after touching the pinnacle (in sponsorship), the challenge for the IPL will now be to achieve that right? and what are you feeling? Will the property be able to sustain these numbers, or grow from here?
VK: IPL has been successful in building a loyal fan base and has managed to attract a diverse audience base. However, it will need to continue to innovate and adapt to changing consumer preferences and expectations, and to attract new audiences across age groups and geographies. Like the WPL, the Junior IPL (could be under 16 or 19) is a natural extension of the IPL and can be a great scouting ground for the men’s IPL. With this, the IPL expands itself to men, women and juniors as a property, which can also be expanded internationally to garner more fans which can drive global sponsorship deals.
Ultimately, the IPL’s success will depend on its ability to deliver a high-quality, innovative and entertaining product that resonates with audiences across India and beyond. If the league can continue to do this, there is a good chance that it will be able to maintain and possibly even grow its current numbers in the future.
While the increase in numbers is impressive, the cricket to non-cricket ratio is still very low. Are you surprised that despite Neeraj Chopra winning such a thrilling gold medal in Tokyo, PV Sindhu’s consistency at the highest level, things are not going the way they should?
VK: It is true that cricket continues to dominate the sports scene in India and other sports are losing popularity. But we have come a long way, we have seen year-on-year growth in emerging games. It is worth noting that the government and the private sector have been taking steps to promote and support other sports in recent years, but it takes time and effort to change the sporting culture of a country. Lastly, it will take sustained efforts from all stakeholders to promote and develop other sports and create a more balanced sports culture in India.
Lately it has been a trend that potential sponsors, who want to associate with BCCI or IPL as official partners, are not looking at long term ties. The trend seems to be leaning more towards the ‘quick-fix’ side. A new fin-tech or start up brand comes in, probably wants to see their membership numbers jump and probably thinks that associating with IPL for a year will get them results. They get those numbers and move on. Isn’t this more or less the ongoing sponsorship trend? How healthy is it and what does it tell you in the long run?
VK: The trend is mainly for technology start-ups for initial spikes in app downloads or subscription numbers. Start-ups typically have resources that are time- and work-dependent, often focused on short-term wins and building a brand in the mid- and long-term.
Leagues need to create a sponsorship ecosystem that encourages both short-term and long-term partnerships and benefits both the league and its sponsors. This can be achieved by creating a clear sponsorship framework that goes beyond mere advertising and branding opportunities, and by providing sponsors with value, such as access to data and analytics, fan engagement and exclusive experiences.
Has the IPL managed to attract international brands the way it should? Recently, we heard the news of RCB getting Qatar Airways on their jersey. Now, if this is true, it is a heartening development. On the lines of Samsung on the jersey of Mumbai Indians a few years back. Given the size and growth of the league, shouldn’t more such international brands be associated with the IPL?
VK: IPL has managed to attract a large number of international brands as sponsors, and this has been a key driver for its success. Many global brands have recognized the immense potential of the Indian market and the popularity of IPL and have invested heavily in the league to reach a wider audience.
Recent international brands that have invested in IPL are Aramco – Orange and Purple Cap, DP World – DC, Qatar Airways – RCB Front Jersey, DHL – Mumbai Indians
The IPL’s ability to attract international brands can be attributed to a number of factors, including its massive viewership, the high quality of cricket on display, and the league’s marketing and promotional activities. IPL has also been successful in creating a highly engaging and entertaining product that appeals to a wide range of audiences in India and around the world.
We are also witnessing a drastic change in consumption patterns. With the advent of JioCinema – in live sports broadcasts; the onslaught of technology; And the setting of clever mediums – how we consume sports is changing forever. What kind of near and far future do you see settling in?
VK: The rise of new technologies and platforms is changing the way fans consume sports content, and this trend is likely to continue in the future. The widespread adoption of mobile devices and streaming platforms has made it easier than ever for fans to access sports content on the go, and has opened up new opportunities for leagues and broadcasters to reach a wider audience.
In the near future, we’re likely to see more innovation in the way sports content is delivered and accessed. This may include the use of augmented and virtual reality technologies to create greater viewing experiences, as well as the integration of social media and fan engagement tools to create more interactive and engaging experiences for fans.
Overall, the future of sports consumption is likely to be characterized by continued innovation and growth, as leagues and broadcasters seek new ways to engage with fans and create value for their sponsors and stakeholders.
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